Frances Hill: The case for greater female representation on boards
RECENT government statistics have revealed that almost 40 per cent of UK FTSE 100 board positions are now held by women.
The data published in the FTSE Women Leaders Review, placed the UK second in international rankings for board representation behind France – great news for efforts to foster greater diversity in our boardrooms.
To be truly effective, an organisation’s board should encompass a range of diverse skills, views and experience to allow for appropriate decision making.
This represents good corporate governance, which is central to helping businesses to improve performance, drive growth, manage risks and attract and retain investors.
But it’s not a box-ticking exercise.
An ever-growing body of research from outlets such as McKinsey and Company and The London Business School Leadership Institute argues the case for increased female representation on boards, citing a wide range of benefits - including better future financial performance, higher stock returns, the avoidance of shareholder dissent and an emphasis on boardroom relationships and collaboration.
The FTSE Women Leaders Review, which monitors women’s representation in 24,000 positions on FTSE 350 Boards and in leadership teams of the UK’s biggest companies, built on the success of the previous Hampton-Alexander and Davies Reviews.
The latest findings demonstrate a major sea-change in attitudes towards getting women leaders to the top table of business in the UK, with women’s board representation increasing by almost 40 per cent in 2021 across the FTSE 100, FTSE 250 and FTSE 350.
It is true that positive progress has been made across senior roles and this should be recognised and celebrated. However, there is still a significant way to go in terms of increasing the number of female CEOs, managing directors and those occupying key functional roles.
Achieving gender balance is the goal for many organisations and businesses, and despite challenges this is by no means unachievable providing the appropriate measures are put in place.
The FTSE Women Leaders Review provides detail on a number of key recommendations aimed at building on previous successes and achieving gender balance within boardrooms by 2025.
These include increasing the voluntary target for FTSE 350 boards and leadership teams to a minimum of 40 per cent women, encouraging FTSE 350 companies to have at least one woman in the chair or senior independent director role on the board and promoting the development of best practice guidance to encourage boards that have not achieved the prior 33 per cent target, to do so.
Although this guidance is aimed towards some of the UK’s largest companies, smaller businesses should also consider adopting these measures.
Thankfully there are already numerous examples of inspirational and successful women in top jobs within some of Northern Ireland’s leading businesses and organisations and we are proud that many are also IoD members.
This was clearly in evidence last month when the Institute of Directors hosted its annual Women’s Leadership Conference, uniting and showcasing many of Northern Ireland’s most prominent female leaders.
Events such as these demonstrate the strength of the female business community and provide insight into the achievements and successes of women in leadership positions, further supporting the case for greater female representation on business boards.
Promoting business diversity is to be welcomed not only in terms of gender but also age, ethnicity, sexuality, and nationality as part of a genuine commitment to fostering best practice and good governance.
:: Frances Hill, is diversity and inclusion ambassador at the Institute of Directors (IoD) Northern Ireland