Making boardrooms more welcoming for career women

If YOU imagine a board meeting of a FTSE 100 company, how many female board members do you see?

Probably not too many. In fact, only 13.9 per cent of the top FTSE 100 board positions are held by women. Fifteencompanies have no female directors at all. After three decades of equality legislation and high numbers of women who are economically active, why has this not filtered through to results at board level?

This was the subject of Lord Davies’ review of women on boards. His report called for a minimum of 25 per cent female board member representation by 2015. Although the notion of imposing a legislative quota was considered, Davies has not – yet – gone as far as recommending this. He wants to see the outcome of a voluntary effort before deciding if legislation is required. Norway and Spain have introduced quota systems that have worked. So why is there a reluctance to impose quotas in the UK?

It’s clear there is little support in the UK for quotas. Only 11 per cent of the companies responding to the consultation supported them. Perhaps the case for legislation in the UK is premature. “The 30 Per Cent Club” is a group of chairmen in England that has given a voluntary commitment to increase the percentage of women on boards. Plans are afoot to introduce something similar in Scotland.

Detractors would point to the effect that a legislative quota could have on women who are subsequently appointed to board positions. They may face resentment from those who feel they have not been appointed on merit. Others may view female board members as “token” women. The obvious, although simplistic, arguments in favour of quotas are speed and consistent results. In 2003, Norway introduced a quota. By 2008, the percentage of women in the boardroom had jumped from 7 per cent to 44.3 per cent. According to the Equality and Human Rights Commission, “at the current rate of change it will take 73 years for women to achieve equal representation on the boards of FTSE 100 companies”.

Evidence also suggests female representation at board level can improve a company’s performance as a more diverse range of experiences, backgrounds and viewpoints are taken into account. One can also counter accusations of tokenism or male resentment if you question whether the status quo is flawless. If you dig deeper in any recruitment system – especially at board level – can you always say that a true meritocracy prevails?

For some, commercial levers from investors or customers may be just as effective as legislation in stimulating action. If you’re going to lose business because the composition of your board is not diverse, then you will act.

On a cautiously optimistic note, it looks like the voluntary approach is starting to bear fruit, with a number of Davies’ recommendations becoming a reality. Nineteen of the top headhunters have already agreed a code of practice on increasing female boardroom appointments. The Financial Reporting Council is consulting on another of Davies’ recommendations, involving a revision to the UK corporate governance code to require listed companies to publish their policy on gender diversity in the boardroom and report against it annually. The Association of British Insurers also intends to issue guidelines in September, designed to prompt companies to bring more women on to their boards.

The Davies report re-opens the debate that all too often women stagnate in middle management and fail to even apply for the top jobs. Changing the culture behind that “choice” is central to the issue. Tackling barriers to work-life balance and the old boy network were two of the key themes identified by the Davies report. In my experience, female confidence is another critical barrier where women tend to undervalue their own abilities. And let’s be honest – real change is only going to be achieved when the workplace adapts to meets the needs of women.

l Eilidh Wiseman is head of employment at law firm Dundas & Wilson.