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Monday 8th March 2010 Women on boards: Public want quicker pace of change
Government calls on firms to report action taken.
Companies may be required to report on their progress to get more
women into the boardroom, under proposals announced today. It
comes as new research shows that sixty per cent of people think
there are not enough women directors in big businesses.
The survey which has been commissioned by the Government
Equalities Office for International Women’s Day shows that half
believe there will be equal numbers of men and women directors
within the next 20 years. However, the reality is that it will
take 60 years for women to gain equal representation on the boards
of the top 100 companies at the current rate of progress[1].
The Government has today asked the Financial Reporting Council to
consider including a new principle in its code of conduct (UK
Corporate Governance Code) to require firms to report on what
they’re doing to increase the number of women in senior management
positions. This builds on the Equality Bill which will allow firms
to choose to use positive action to appoint more women to senior
roles.
Other key findings from the survey include:
· A clear majority (80%) think a balanced senior management team
will be better at understanding their customers.
· Nearly two thirds (61%) believe businesses are losing out on
talent by having fewer women in senior roles.
· More than three quarters (78%) disagree that, because men have
more experience in senior management than women, men are better at
running companies.
· Nearly three quarters (72%) think it is important that women
and men should have an equal say in the business decisions over
how the British economy is run.
· More than half (55%) think both men and women should share
decisions in the finance sector which affect the economy. Only 7%
think decisions should be left just to men.
· 71% believe having more women on senior management teams will
lead to more family friendly working practices.
· More than half (59%) think that having senior management teams
of all one sex will be more likely to think in the same way
(‘groupthink’) and so make poor decisions.
· Just under half (43%) think there should be an equal balance of
both men and women in investment banking.
This morning the Prime Minister will be hosting a business
breakfast at Downing Street with leading women in business, to
mark International Women’s Day and to discuss the opportunities
and challenges facing women's leadership in business and enterprise.
Prime Minister Gordon Brown said:
"We all recognise the value of strong role models for
women in all walks of life – and there are many in politics, the
arts, public services, sport and the third sector. But there are
too few in Britain’s boardrooms. When more than half of graduates
are women, it is completely unacceptable that some of our top 100
public companies have not a single woman on their boards - and
that none at all have a majority of women on their boards.
"A new principle in the governance code on diversity
would build on the provisions in the equality bill, which allow
employers to take positive action when recruiting to balance their
workforce.
"But if we do not see a dramatic change in the
composition of company boards in the future, we will need to
consider taking more serious action to ensure companies recruit
from the diverse pool of exceptional talent we have in the UK.”
Harriet Harman, Minister Women and Equalities,
said:
"Britain needs more women in the boardroom. This survey
shows that the public want a quicker pace of change. Government is
playing its part, but firms need to play their part to.
"Too many British boardrooms are still no-go areas for
women. Women are important consumers and employees. We’ll never
get a proper meritocracy or truly family-friendly workplaces from
male dominated boards.
"Businesses that run on the basis of an old boy network
and do not draw on the talents of all the population will not be
the ones that flourish and prosper in the 21st century."
Lord Davies, Minister for Trade, Investment and
Small Business, said:
"Company boards benefit greatly from the contribution
women members bring. Companies who fail to grasp the growing
economic power of women and rely on outdated business models are
missing significant business opportunities.
"The days of male domination of business are long over.
It is time for the boardrooms of Britain to be drawn from the wide
pool of excellent talent we have available in the UK, or else
businesses will lose out to foreign companies who are better
attuned to new business opportunities."
Currently, only one in ten FTSE board directors are women, and 25
firms have no women on them at all[2].
Women continue to be under-represented at board level despite
having the right education and experience they need to succeed,
and are deterred from applying due to corporate boards being
dominated by “old boys’ networks”. [3]
Steps the Government is taking to support women in business include:
· The Equality Bill will allow employers to use positive action
to appoint more women to senior roles, if they want to, provided
the candidates are equally suitable.
· The Government has asked the Financial Reporting Council to
consider including a new principle in its code of conduct (UK
Corporate Governance Code) to require firms to report on what
they’re doing to get more women into their boardrooms. This would
help diversify the talent pool available to business, which in
turn can drive success and competitiveness, benefiting the wider
UK economy as a whole.
· The Equality and Human Rights Commission is producing
recommendations shortly on how to further tackle sex
discrimination in the finance sector, following an inquiry last
year that found only one tenth (11%) of senior managers were
women.
· Last month, the Government launched a new Women’s Employment
Strategy to work towards a fair and family friendly labour market,
and signposting businesses to programmes, networks and services
aimed at improving senior representation.
· In 2008 the Government and Opportunity Now identified 100
exemplar employers who have taken action to increase the number of
women at senior levels.
· The Civil Service is also committed to increasing the
representation of women in top jobs. There are currently a 1,500
women in the Senior Civil Service representing 35%, which is a
doubling in the last ten years, and 28% of those are in Top
Management Posts (Director and above), with seven female Permanent
Secretaries. The Civil Service has set targets to achieve 39% for
women in the SCS and 35% in top management by 2013 with a stretch
to achieve by 2011.
MEDIA ENQUIRIES
Please contact the Government Equalities Office press office on
0207 276 1175 or out of hours 07500 816 959.
On the Financial Reporting Council and Regional Women’s
Enterprise Champions, please contact BIS press office on 020 7215 5614.
NOTES FOR EDITORS · The Government Equalities
Office is responsible for the Government’s overall strategy,
legislation, and priorities on equality issues. The Office also
has direct responsibility for policy on gender equality, sexual
orientation, and for integrating work on race. The Prime Minister
announced the establishment of the Government Equalities Office
(GEO) in July 2007 and it became a Department in its own right in
October 2007. It works to Ministers Harriet Harman, Maria Eagle,
Vera Baird, and Michael Foster.
· The survey was commissioned by the Government Equalities Office
and conducted by Ipsos MORI.
· Ipsos MORI interviewed a representative quota sample of 1,071
adults in Great Britain aged 16+. Interviews were conducted by
telephone between 20-24 February 2010. Data are weighted to match
the profile of the population. The full research report will be
published on the GEO website on 11 March 2010: www.equalities.gov.uk
· International Women's Day (8 March 2010) is a global
day celebrating the economic, political and social achievements of
women past, present and future. It is an opportunity for
organisations, individuals and Government to celebrate the
progress made in the past 99 years since the first International
Women's Day but also to look forward to the other
important action that needs to take place to ensure the lives of
women both in Britain and all around the world are improved.
· The Equality Bill will allow employers to choose to take
positive action to appoint a person from an under-represented
group, provided candidates are as qualified to do the job as each
other, and so balance things out if they want to.
· The Financial Reporting Council is currently consulting on
their code of conduct (UK Corporate Governance Code). As part of
this consultation the Government has asked the FRC to consider
including a new principle in its code of conduct to require firms
to report on what they’re doing to increase the number of women
directors in senior management positions.
[1] According to the Equality and Human Rights Commission
[2] Cranfield School of Management Female FTSE 100 Index 2009
[3] Cranfield School of Management. ‘Increasing diversity on
public and private sector boards: Part 1 - How diverse are boards
and why?’ commissioned by the Government Equalities Office,
November 2009.
Contacts:
Government Equalities Office press office
Phone: 0207 276 0932
enquiries@coi.gsi.gov.uk