David Prosser: The clock is ticking in the old-fashioned boardrooms of Britain
Outlook Time is running out for stuck-in-the-mud companies that are still failing to take seriously the issue of getting more women on to their boards – and there are plenty of them. Back in February, Lord Davies, who lead an inquiry into the shocking lack of women directors at large companies, gave those firms six months to explain what they intend to do remedy the problem. That deadline expires in a matter of weeks, yet we have heard precious little from far too many companies.
That is beginning to cause some anxiety. Yesterday the Association of British Insurers announced it is close to publishing new guidelines to help the businesses in which its members invest to confront the issue of female board representation. Last week, Business Secretary Vince Cable and Theresa May, the Minister for Women, wrote to every company in the FTSE 350 urging them to get a move on. It is worth remembering that Lord Davies' requirements are not especially exacting. He wants large companies to ensure women constitute at least 25 per cent of the board by 2015 (and 20 per cent by 2013), but has resisted calls, at least for now, for mandatory quotas. And this month's deadline requires companies only to provide detail of how they will work towards his targets.
We should give credit where it is due, for there has been some modest progress in recent months. So far this year, women account for 30 per cent of all FTSE 100 board appointments. That presumably reflects a recognition amongst companies that doing nothing is no longer an option (it also rather undermines warnings from some sections of business that that there aren't enough women with the necessary skills and experience). Even after this spike, however, women account for only 13.9 per cent of directorships in the Footsie. And 14 FTSE 100 companies still have not a single woman on their boards. Unless the spike is enduring and even sharper, Lord Davies' targets do not look achievable.
Will those targets, in any case, be superceded by instructions from Europe? Viviane Reding, the European Union's Justice Commissioner says she thinks 30 per cent by 2015, rising to 40 per cent by 2020 would be more appropriate targets for large European companies – and she has begun talking about legislating for that. Formal proposals have not yet been forthcoming, though one imagines British recalcitrance might be the sort of spur that would prompt Ms Templeman to put that right, and the European Parliament has already called for new laws.
British companies can certainly not expect much help from their counterparts on the continent in resisting that type of EU legislation, for mandatory quotas are becoming the norm in an increasing number of countries.
One way or another, in other words, the governance of Britain's biggest companies will soon have to be more balanced across the genders. With Lord Davies' deadline hanging over them, FTSE 350 companies ought to realise that it would be better to put their houses in order on their own terms than to have a solution imposed upon them by Westminster or Brussels.
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