Today Lord Davies’ final report for the UK Government on gender diversity in the boardroom shows that women’s representation in the FTSE 100 has more than doubled, exceeding the 2011 target of 25% in less than five years. There are more women on FTSE 350 boards than ever before and there has been a dramatic reduction in the number of all-male boards. 

The report highlights that the lack of gender diversity on British boards is fundamentally a business issue, rather than looking at the problem as a narrow equality, diversity or women’s issue. 

Following the frank and passionate debate on board diversity, targets and quotas at last week’s launch of our speaker series “Success – a female perspective”, we have set out the key findings from today’s report. Here is what you need to know.

1. Exceeding expectations

Huge progress has been made in a very short time, showing that businesses can, and want to, change. 

In just four years, companies achieved: 

  • 550 new women appointments to FTSE 350 boards; 
  • Reaching the 25% target for women board members for the FTSE 100; 
  • No single all-male boards left in the FTSE 100 (versus 21 in 2011); and
  • An expanding pool of credible, capable women available for future board positions 

It is not just listed companies that are driving change. Executive search firms have played a key role by introducing an accreditation scheme requiring search firms to demonstrate a proven record of helping women achieve their first board appointment.

2. Not there yet

Clearly there is more work to be done. It is crucial that the commitment and momentum generated in the past four years continues, especially in light of some more sobering findings: 

  • Women executive appointments in the FTSE 100 remain low at 9.6%; 
  • In four years, the number of FTSE 100 women chairmen increased by just one; the number of women CEOs remained unchanged at five; 
  • There are still 15 companies with all-male boards in the FTSE 250; and 
  • Companies are not yet addressing the all-important executive layer immediately below the board 

Perhaps the most disappointing finding is that the expected ‘Investor Spring’ for women on boards has not yet happened. Harnessing the power of the investor community could solve remaining gender imbalances in very short order. In the next years, the investor community as a whole needs to be engaged and mobilised to influence and prompt further corrective action from companies.

3. How do we move forward?

Acknowledging that we all wish for faster progress, the report finds that the introduction of quotas or other legislative measures is unwarranted. Lord Davies reports an “overwhelming” message from British business at the start of this review saying that they understand the business case for improving diversity on boards and that they can “fix this”. 

And indeed, the UK has emerged as a leader and role model on the international stage for having made such good progress under an entirely voluntary regime: it’s sixth in Europe behind Norway, Sweden, France, Finland and Belgium (many of whom have introduced quota regimes). The UK has also recently endorsed “name blind” recruitment to tackle unconscious bias.

4. New targets

The report leaves us with the following recommendations for further work and a renewed focus: 

  • Continue the national call for action and the voluntary, business-led approach for a further five years with a new steering body to report in early 2016; 
  • Increase the voluntary target for women’s representation on FTSE 350 boards to a minimum of 33% by 2020; 
  • Ensure an increasing number of women are appointed to the roles of Chair, Senior Independent Director and into Executive Director positions on FTSE 350 boards; 
  • Extend best practice seen at board level to improve gender balance and fundamentally improve the representation of women in the executive layer; and 
  • All FTSE listed companies to assess the gender balance on their boards and take prompt action to address any shortfall