Gender diversity in UK boardrooms lags behind Europe
Gender diversity in UK boardrooms is lagging behind Europe with just 30.1% of company seats held by women in the UK. According to a new global report by Deloitte, ‘Women in the boardroom: A global perspective’, women leaders on the continent boast the largest share of global boardroom seats, led by France (43.2%), followed by Norway (42.4%) and Italy (36.6%).
The UK entered the top ten global ranking, moving from 13th to 9th place since the report was last published in 2019. However, despite the 7.4% increase of women holding UK board seats, the UK’s boardroom diversity lags behind six European countries as well as New Zealand and South Africa.
Jackie Henry, Managing Partner, people and purpose, Deloitte UK, said:
“Board diversity is a demonstration of an organisation’s commitment to inclusion. Whilst the number of board seats held by those identifying as women in the UK is moving in the right direction, we’re still a long way behind our European neighbours with leaders France only 6.8% short of gender parity. UK businesses need to be even more proactive in taking diversity targets seriously, improving disclosure and more transparent reporting.”
Gender parity
Deloitte’s report, published in collaboration with the 30% Club, demonstrates slow progress towards gender parity globally with just one in five (19.7%) boardroom seats held by women - a 2.8% increase since 2019.
Henry added:
“At this pace, the world could expect to reach near parity in 2045, more than 20 years from now, but the UK could realise gender parity as soon as 2027 if the progress we’ve seen in the last two years continues at the same pace.”
UK boards
The proportion of women on FTSE 100 boards has tripled in the past 12 years. In 2010, FTSE 100 boards were made up of just 12% of women, but this has now grown to 36.2%. There are 15 women board chairs in the FTSE 100 and eight CEOs; an increase of just one since 2019.
The average age of women on boards in the UK is 56.8 years, while the average age for a woman chair is 60.1 – more than four years younger than their male counterparts (64.3). The report also found the average tenure for women on boards in the UK decreased from 4.1 years to 3.6 years since the last report published in 2019.
Impact of diverse leadership
Deloitte’s global research analysed data from 10,493 companies in 51 countries and revealed a positive correlation between women CEO leadership and board diversity. Companies with women CEOs have significantly more women on their boards than those run by men - 33.5% versus 19.4%, respectively. The statistics are similar for companies with women chairs - 30.8% women on boards versus 19.4%, respectively. The inverse is true as well, with gender-diverse boards more likely to appoint a woman CEO and board chair. The decisions that businesses make around people practice can have an influence on their own workers and wider society. Creating a business case for diversity and inclusion means balancing the positive outcomes for individuals with business outcomes. Business benefits of diversity and inclusion include talent, market competitiveness and corporate reputation.
Henry continued:
“We know that leadership sets the tone for the rest of the business. Increased ethnic minority and all-gender participation at every level are vital if businesses want to have a truly inclusive culture. There are other important dimensions of diversity that government, regulators, businesses, and investors should consider, including LGBTQ+, disability, neurodiversity and socio-economic background. I believe that to achieve the strongest company boards we need a diversity of thought and experience - and that will only be possible by developing an inclusive pipeline of talent.”
Sharon Thorne, Deloitte Global Board Chair, added:
“While it’s heartening to see that the world continues to make progress towards achieving gender parity, with the exception of a few countries, overall progress remains slow and uneven. The pandemic has dented efforts to achieve equality, making it even more important to move past discussion and take concrete actions to ensure inclusion within and beyond the boardroom including gender, ethnic and racial diversity among other characteristics. Increasing the number of women on boards is only the first step on a larger journey.”
30% Club
Commenting on its key findings, Ann Cairns, global chair of the 30% Club said:
"With the FTSE 100 on the brink of attaining 40% women in board roles, I am encouraged by Deloitte’s finding that UK parity could be reached by 2027. People often ask why the 30% Club is not the 50% Club given that our aim is parity. I think this report answers that question, we are still far from the 30% tipping point in many geographies.
“One of the report's most interesting findings is the real balance that female leaders bring. If women CEOs can have more balanced boards, there’s no reason that male CEOs can't. Finally, on the stretch, this speaks to the fact that women have a harder time being appointed if they don’t have previous board experience. Chairs and CEOs should be encouraged to give women their first board seat. There is plenty of talent out there who would make great directors. This is very true for people of colour too, many of whom would welcome the chance to make a significant contribution at the top of the corporate world but remain significantly under-represented."
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