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Blog : BOARD TALK

One Year On : Think, Share, Comply (Not Complain) Or Explain

Posted on February 25, 2012 at 3:45 PM

In the UK we are inching forward to the better representation of women in the running of our plcs, and I'm beginning to think too much focus on the boardroom is a mistake. What is essentially needed is a change of culture, a fresh way of looking at what senior roles actually require of an individual (eg do they really need to be able to jet off to Australia at a moment's notice ?) and urgent concentration on the executive pipeline. That is going to take a lot of conversation - and time - for any kind of sustainable change.


But this is meant to be a blog about the boardroom. And conversation is essential, so it was very good to see the 1st anniversary yesterday of the report by Lord Davies on the lack of women in the UK's boardrooms marked by the 30% Club - which aims to achieve a 30% goal of women on boards by 2015 - with an inaugural event involving investors.


The good news : Four signficant investors have announced their support of the initiative. They are : Aberdeen Asset Management, BlackRock, Hermes Equity Ownership Services and the Local Authority Pension Fund Forum (LAPF). This takes the assets represented as being behind the initiative to over £1.77 trillion. Let's hope money continues to live up to its reputation for commanding attention.


More good news from Sir Roger Carr, the enlightened chairman of Centrica (and President  of the CBI) leading the charge: in 2011, 100 women were appointed to FTSE-100 and FTSE-250 boards, over half being new to the role of director. The rate of female appointments has more than doubled, with 27% of new appointments going to women - both for FTSE-100 and FTSE-250 roles.


But, as he pointed out in his speech, "the first woman through the door needs to have a 'welcome' mat that everyone can see. That is the task of the chairman."


And still FTSE-100 boards are still at 15.2% representation. The only plcs you want to raise a glass to are Diageo, Burberry and Pearson - they have achieved 30% representation, the number only significant because so many studies show that it is at that point that ironically gender ceases to matter and you can get on and do your job without worrying if you chose the right outfit that morning or if you stick out in any other way.


(By the way, it is worth noting that Diageo has a female CFO  Deirdre Mahlan, Burberry has a female CEO Angela Ahrendts and a female CFO Stacey Cartwright and Pearson has a female CEO Marjorie Scardino and a former female CFO Rona Fairhead, who is now CEO of Financial Times Group. Just sayin'.....)


Good to know too, that investors are signing up to the idea of diversity and to challenge. (Mr) Sacha Sadan, Director of Corporate Governance at Legal & General Investment Management  : "As one of the UK's largest investors, LGIM is active in challenging the composition of boards and bringing diversity into the borader discusison on board nominations and succession planning. We intend to increase that pressure in the future."


Baroness Hogg, Chairman of the Financial Reporting Council said what everyone hopes is true: "Progress can seem glacial, and then you can get one or two triggers that create an avalanche."


As the weather in London and the south-east does a good imitation of spring this weekend, we don't want to be talking about avalanches, but we do want to be hopeful. I want to believe all these important people that change really is in the air, that, as the 30% Club put it in its programme for the event, "in 18 months the nature of the debate has changed in the UK from 'why is this important?' to 'how do we achieve change.'


Some 32 companies have reached 20% female representation in the boardroom. The 30% Club had seven chairmen behind it when it started, and now has 37, which is very encouraging - and it is aiming for 50 Chairmen supporters by mid-2012 (now four months away) - as well as 20% female representation on all FTSE-100 boards by end 2012. 


So maybe we are at that 'tipping point' - take a deep breath and do what you can to support them. That means ladies, go and get the advice you need to persuade you to apply for those roles. A great deal of conversations suggest that hesitation - especially verbalised, public , interview-situation hesitation as opposed to a quiet bit of angst about 'juggling' expressed at the dinner table - is still one of the biggest factors holding women back.


I do have to say that I hope the 30 % Club meant to say their approach is consistent with the UK government's 'comply or explain' corporate governance code and culture and not  'complain or explain' as set out in their programme. Or perhaps it was a Freudian slip - in which case we are doomed in this endeavour.



Categories: Women, Investors, Chairmen