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Connecting women and opportunity

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Connecting women and opportunity

Womanthology is a digital magazine and professional community powered by female energy and ingenuity.

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Vince Cable, Secretary of State for Business, Innovation and Skills – Almost double the number of women on FTSE 100 boards since 2011 but still an enormous amount to do

Davies Review 2015 report-cover

Vince Cable, Liberal Democrat MP for Twickenham, was appointed Secretary of State for Business, Innovation and Skills in May 2010. He studied natural science and economics at Fitzwilliam College, Cambridge, followed by a Ph.D. at Glasgow University. He served in the Liberal Democrat Shadow Cabinet as Spokesman on Trade and Industry from 1999 to 2003, and Shadow Chancellor from 2003 to 2010; he was Deputy Leader of the Liberal Democrats from 2006 to 2010. 

Vince Cable
Vince Cable

On Wednesday 26th March 2015 Lord Davies of Abersoch published the third annual progress report into Women on Boards. Three years on from the ground-breaking review in 2011, Lord Davies and his steering group reported a growing number of women in decision-making roles. The figures were published at the same time as the Cranfield University School of Management’s Female FTSE Board report. Vince Cable spoke alongside Lord Davies and Sir David Walker, Barclays Chairman, amongst others at the launch of the reports at Barclay’s offices.

Background to the Davies Review Annual Report for 2015 – Diversity is good for business

The process started when I asked Lord Davies back in 2011 to look at the whole issue of how we remove some of the imbalance at the top of British business and what was the best way of doing it? [It was] very male dominated. He set up a process and a target, which was 25% by the end of this year [2015], and the objective was to achieve it not through coercion and quotas, and not through arguments around political correctness, but on the basis that this was good for business.

There is a team that was established by Lord Davies. Denise Wilson runs it so there’s a fairly constant process of interaction with companies and helping women with mentoring, encouragement and so on.

Engagement with company chairs, recruitment consultants and institutional investors to hold their companies to account

I’m only the tip of the iceberg, but even at my level we’ve had numerous meetings with company chairs, with the recruitment consultants and then we did some detailed work and a report by Charlotte Sweeney on the way recruitment consultants operate, the drawing up of shortlists and establishing a code of practice.

We talked to the institutional investors who are the people who call the shots there, the big shareholders about holding their companies to account.

One of the last events I attended was a kind of speed dating event where we got a lot of women who are recommended by their own companies for the boards of the top companies to actually meet the chairs of the big companies and hopefully progress their appointment.

Genuine diversity at the top of business means better commercial performance

All the research shows that having genuine diversity at the top of business is actually good for them – they perform better commercially. As a result of this effort and an enormous amount of interaction with the Davies team, myself and my department with institutional investors, chairs of companies with women’s groups, with recruitment consultants and others, we’ve now got to a point where the latest figure is 23.5%, which is double what it was (12% or thereabouts) in 2011.

We’ve got similar progression, a doubling of the proportion in the FTSE 250, but it’s at a rather lower level we’ve got up to – it’s about 20.

Still an enormous amount to do

There is still an enormous amount to do even though every single FTSE 100 company has now got a woman on the board we do recognise that this is work in progress. We acknowledge for example that if you’re talking about executive directors as opposed to non-execs, it’s still quite a small percentage – it’s about just under 10%, and chairs, I think we have five out of the hundred. It fluctuates, but it’s a much lower percentage.

The FTSE 250 is less advanced than the FTSE 100, which is why Lord Davies and I have written to the chairs of all the 250 companies saying they should be getting up to the same level as the FTSE 100.

Vindication of the no quotas process we’ve adopted

I think in terms of progression we’ve achieved a great deal and I think it’s a vindication of the process we’ve adopted, which is trying to persuade business, trying to get them to own the issue rather than resorting to the quota approach of some European countries.

The final thing I would say is because it’s work in progress we’ve got to set the next level of aspiration. We should be aiming for gender equality, and some organisations do that. In my own department we have gender equality at board level, departmental board level and in senior management, but business is obviously a long way off that.

Aiming for a third of women on the boards by the end of the decade

What we think is realistic is to aim at the end of the decade for having a third of women on the board of the top companies. Once you get beyond 30% you’ve got a tipping point.

It is about maintaining career progression. The typical problem happens in the early 30s when women want to go off for a while and have a family and even if they have a supportive partner, they lose out for two or three years in terms of the hierarchy and promotion. It’s trying to get companies to adopt good practice and recognise that isn’t some kind of loss or cost and should not be debited to people who carry out their family responsibilities.

Some companies are doing that. It’s at a government level also encouraging a much more flexible, progressive approach to families. We’ve brought in the legislation on shared parental leave and the right to request flexible working. All these things make it easier for families to share family responsibilities.

Fulfilling families where men and women equally take a much more flexible approach to work

One of the longer term consequences of [shared parental leave] will be that a lot of very talented men will not feel that they have to do the 16 hour a day grind to get to the top and there will be fulfilling families in which men and women equally take a much more flexible approach to work. Government can’t mandate people’s mentality, but I think we can create a legislative framework within which that happens.

Banishing the traditional macho culture at the top of some companies

There sometimes is a difference in style – some companies have traditionally had a very match culture at the top and it’s off-putting for people who are trying to come through. It’s very difficult to change culture of that kind other than to show the examples of where you have had genuine diversity in companies [and make it] clear this isn’t something they’re doing for show, but it’s actually making their companies more successful, even the mining companies, which are typical examples.

I remember having a discussion with a chief executive of one of the leading mining companies – he regarded the whole thing as a bit of a joke. Do we really want women trampling round the jungles of the Congo and all this kind of thing? But once he realised that in that sector it’s perfectly possible to have a more creative approach to appointment at the top and do well, even that company has now got women on the board.

My own department – the most testing job at director level is done by two women on job share. It can be done and it is done

I was looking at my own department and probably the most testing job at director level (we have a system of directors who control the key areas of policy) [with] responsibility for universities, you can imagine is very big and [is done by] two women on job share. They come into my office quite frequently and they are completely on top of the job, regardless of which of them happens to be in the office on that day. They do it brilliantly.

There’s another pair like that in another bit of the department and the love their job because they have a very high level of seniority and they are constantly interacting with ministers on a highly prestigious, powerful role. They’ve got young children and they have a fulfilling home life. It can be done and it is done.

Lord Davies has been putting pressure on companies to reach this 25% target of women on FTSE 100 boards by the end of 2015 – what’s next?

Obviously it depends on the next government and it depends on the next Secretary of State being as committed as I’ve been to this, but I’m optimistic that is the case. There is now a far higher level of buy in than there used to be politically. Lord Davies doesn’t have the chore of seeking re-election as I do! He’s still around to continue with this process. I think it will continue.


As of 3rd March 2014, in the FTSE100:

  • women now account for 20.7% of overall board directorships, up from 17.3% in April 2013
  • of this, women account for 25.5% of non-executive directorships and 6.9% of executive directorships
  • women account for 231 of the 1,117 FTSE100 board positions
  • women account for 28% of all board appointments in 2013/14
  • there remain 2 all-male boards – Glencore Xstrata and Antofagasta
  • fewer than 50 new women appointments need to be made to reach the 25% target

In the FTSE 250 the figures show:

  • women now account for 15.6% of overall board directorships, up from 13.2% in 2013
  • of this, women account for 19.6% of non-executive directorships and 5.3% of executive directorships
  • women account for 33% of all board appointments in 2013/14
  • there remain 48 all-male boards

The latest report shows that more and more FTSE Chairs are convinced of the value of women in boardroom. Twelve companies in the FTSE100 have 4 or more women in the boardroom, with 27 having more than 2. The report also shows that companies are setting themselves challenging targets while the pipeline continues to be strengthened.

Read the report here.

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