, took place during the Second Annual Paul H. Nitze School of Advanced International Studies (SAIS) at Johns Hopkins University on Sept. 9. During the interview Lord Davies mentioned that his committee would meet again in October and report on what is being done in the UK.
“We want more transparency in the boardrooms,” Lord Davies told Spector. “We want more attention to be paid to the makeup of the board. We want a minimum of 25 percent level [of women directors by 2015]. Boards of companies should have people who better represent their clients and their business. Having women on the board just makes good business sense.”
“It’s not just the boards that need more women, but also the executive committees of big companies. We want radical change in the UK.”
Lord Davies’ independent review led to the issuance of recommendations in a February 2011 report
. Among the recommendations were:
- All Chairmen of FTSE 350 companies should set out the percentage of women they aim to have on their boards in 2013 and 2015. FTSE 100 boards should aim for a minimum of 25 percent female representation by 2015 and we expect that many will achieve a higher figure.
- Quoted companies should be required to disclose each year the proportion of women on the board, women in senior executive positions and female employees in the whole organization.
- The Financial Reporting Council should amend the UK Corporate Governance Code to require listed companies to establish a policy concerning boardroom diversity, including measurable objectives for implementing the policy, and disclose annually a summary of the policy and the progress made in achieving the objectives.
- Executive search firms should draw up a Voluntary Code of Conduct addressing gender diversity and best practice which covers the relevant search criteria and processes relating to FTSE 350 board level appointments.
The report cites a 2010 FTSE 100 board composition study that found only 13 percent of directors are female and of that only 2 percent are executive directors. One section of the report, refers to the female executive pipeline challenge where “the low number of women on boards is in part a symptom of insufficient numbers emerging at the top of the management structure and the under-representation of women in senior management generally.”
This pipeline challenge issue is addressed in a new Heidrick & Struggles/WomenCorporateDirectors survey
on the need for women director quotas. That survey found that 53 percent of the 721 male and female board members from 26 countries believe quotas are effective for increasing board diversity. Also, 76 percent of the women directors believe increased board diversity will be effective in rebuilding trust in boards compared to 42 percent of men directors.
“About one-third of women directors globally believe that closed off traditional networks are the primary reason women aren’t considered for director positions, whereas men believe there are fewer women currently in executive leadership roles, creating a smaller talent pipeline for entrance into the board room,” said Bonnie Gwin, vice chair and managing partner at Heidrick & Struggles. By the way, Gwin is chair of the Make-A-Wish Foundation’s board.
Gwin, who was one of many speakers at the WomenCorporateDirectors Global Institute earlier this summer, had asked Maggie Wilderotter, chair and CEO of Frontier Communications, how she would shift the paradigm to increase the number of women directors.
Wilderotter said that while she doesn’t believe quotas will solve the problem, she suggests that companies help build the pipeline of women in operational roles who could be attractive to nominating committees for prospective director positions. “We don’t have enough women in operating positions, and affording women that opportunity in the pipeline is critical,” Wilderotter said.
And just last week the National Association of Corporate Directors (NACD) and PwC
joined in on the global conversation on women in the boardroom. The two organizations co-hosted more than 120 corporate leaders at a forum in New York City about opportunities for women in the boardroom. Out of the meeting came next steps to help women’s advancement in the boardroom.
Those steps for prospective women directors are the following:
– Meet with influential directors, fellow board members and management, including CEOs and the chairs of nominating/governance committees which oversee board composition.
your commitment to boardroom excellence and participate in boardroom education programs throughout the country and increase your personal value as a director.
boardroom renewal. Realize that both age and term limits have increased over the past few years, so board seats are not opening for new board candidates as frequently.
companies' proxy statements and explore their diversity policies in public disclosures.
after a new board seat with the same fervor and rigor as a new-job search.
Whether it’s at conferences, in new studies or on the blogosphere, the issue of whether or not there are enough women in the boardroom has begun to pick up steam globally. The issue has been the topic of a recent forum in New York City, a recent global study on differences between male and female directors and the focus of a task force and report headed up by the former United Kingdom trade minister.
In an interview with former UK minister of trade, investment and small business Lord Mervyn Davies of Abersoch, CBE, The Conference Board President and CEO Jonathan Spector got to the bottom of an independent review of women on boards completed by Lord Davies and a steering board in February. The interview, which you can see in its entirety