Despite the strong business case
for gender diversity, the percentage of senior female executives in the UK’s
top 100 companies is lower today than in 2007. In 2010, the Government
asked Lord Davies of Abersoch to make recommendations on increasing the number
of women in the boardroom. His report and subsequent action has boosted the
number of women on boards, though principally as non-executives. In our report published last week, the Conservative Women’s Forum tackled the issue of
increasing the number of female executive directors. We set out clear
steps and policies for companies, the Government and women themselves to fill
the executive pipeline of talent.
Last year, McKinsey & Co.’s “Women Matter” study showed
the correlation between companies with more women in their senior management
and higher financial returns. Other research has found greater gender
diversity improves corporate governance, decision-making and connection
with market. However, the number of FTSE 100 senior female executives
actually fell to 15 per cent last year, lower than in 2007. This may explain
why there are only three female CEOs in the FTSE 100.
Since companies benefit from having more senior women, they
must take responsibility for building the pipeline. We oppose the quotas
threatened by the European Commission. Rather, companies should collect
and publish detailed data which will allow them to set objective targets and
measure their progress. In manufacturing this follows the “MUCI mindset” –
you can’t improve what you don’t control; you can’t control what you don’t
understand; you can’t understand what you don’t measure. Put another way,
to improve you have to know your starting point, and what gets measured gets
Companies can bring about progress in other ways, too.
Unconscious bias training can be a simple but effective tool to ensure that
appointment and promotion decisions are made on a meritocratic basis.
Formalised programmes for women on career breaks or who are returning to work
will make staying in the pipeline a more attractive prospect for women.
Nor does the pipeline start with companies, but with schools
and universities. The UK has the fifth worst gender gaps in the
OECD in both science and maths. Bridging these gaps would help the
economy by up to £23bn – so we believe businesses should be playing a leading
role in shaping the career aspirations of young women.
The Government can work to back up this business-led
approach. Lord Davies’s initiative has led to company reporting on gender
diversity in their boardrooms and executive committees. This should be
extended into the pipeline where the toughest challenge lies. The
Government can also help by setting an example. We call for the extension
of Lord Davies’ remit to cover the public sector, together with the
professional services industry, which faces many of the same challenges as
While business and the Government can do much, executive
women are ultimately responsible for their own career development and
progression. They can take steps to help themselves, for instance by
seeking out sponsors and taking on “stretch” assignments early in their
At our launch, Alison Carnwath – the only FTSE
100 Chairman, heading up Land Securities – stressed the importance of
leadership within companies and self-help. We are encouraged by the reaction to
our report. We will continue to press for these recommendations which
ultimately will help British business growth. We are optimistic about the future
for executive women. More and more businesses are convinced by the sound
financial reasons for greater gender diversity. Our report shows them how
to lead the field in building the executive pipeline of talent.