Blog : BOARD TALK
|Posted on August 3, 2015 at 1:45 PM|
Good news: the proportion of first-time FTSE 350 non-executive directors (NEDs) who are women significantly increased last year, according to new findings from Korn Ferry, the leadership and talent consulting firm.
Analysing all the first-time NED appointments to FTSE 350 companies in its 'Class of 2014' report, it finds that 39% of first-time appointees in 2014 were women, up from 28% in 2013 and just 11% in 2007, the first year it did this analysis.
Out of 434 NED appointments to the FTSE 350 in 2014, an impressive 233 (54%) were first-time appointments.The proportion of appointments given to first-timers has increased steadily from 48% in 2012 and 53% in 2013, says Korn/Ferry.
It points out that this trend of bringing “new blood” into the boardroom has been driven partly by the push on gender diversity, but also by the return of IPO activity over the past two years. There were 15 FTSE 350 IPOs in 2014, contributing to 32 first-time appointments. In 2013 the same number of IPOs contributed 55 first-time appointments.
Private companies have also been a source of new plc boardroom talent. The proportion of appointees with executive director experience on the boards of private companies has gone up from 12% to 27% between 2007 and 2014.
In contrast, the number of first-time appointees with previous experience as executive directors of FTSE 350 companies has fallen: from 24% to 15% over that period.
This is "a symptom of a trend of migration of top class leadership talent towards private equity-owned companies over the period" says Korn Ferry.
But, while gender diversity in the FTSE 350 is improving, the research shows other elements of diversity have stagnated or declined.
The proportion of non-British non-executives has steadily decreased since 2007, it says. Korn Ferry attributes this as possibly due to the increasing time requirements facing NEDs, particularly in the financial services sector, and the logistical challenge for boards that need to coordinate the travel of those residing outside the country.
But if diversity of nationality is declining, this is offset by an increase in British appointees with international experience, up from only 43% in 2007 to 55 % in 2014.
The researchers don't seem to have asked about ethnic diversity - but then no one ever does, probably because the figures are so appalling.
The 'Class of 2014' report is available from Korn Ferry on request.