‘Outrageous’ attitude to women on boards

Just one in five individuals being proposed for senior financial services positions are women according to research by Pinsent Masons, while the Department for Business, Energy and Industrial Strategy (BEIS) has described some of the reasons given for low levels of female representation on FTSE 350 boards as ‘outrageous’

Updated figures for the number of women on FTSE 350 boards are to be published later in June, at the halfway point of the independent Hampton-Alexander Review. Launched in November 2016, the review is challenging all FTSE 350 companies to make sure at least a third of their board members and leadership are women by 2020.

In advance, BEIS has released a list of what it calls ‘outrageous’ explanations for not appointing more women. These include suggestions they are not able to understand the ‘extremely complex’ issues FTSE boards deal with and the idea women do not want the ‘hassle or pressure’ of sitting on a top board.

The explanations, which come from a range of FTSE 350 Chairs and CEOs, also include ‘All the “good” women have already been snapped up’; ‘We have one woman already on the board, so we are done - it is someone else’s turn’; and ‘There aren’t any vacancies at the moment - if there were I would think about appointing a woman’.

Additional comments were ‘My other board colleagues wouldn’t want to appoint a woman on our board’ and ‘I can’t just appoint a woman because I want to’.

Sir Philip Hampton said: ‘Around a third of FTSE 350 companies still have very few women either on their boards or in senior leadership roles. We used to hear these excuses regularly a few years ago, thankfully much less so now.

‘However, leaders expressing warm words of support but actually doing very little to appoint women into top jobs - or quietly blocking progress - are really not much better.’

Commenting on the report, Rebecca Durrant, tax partner in the Manchester office of Crowe Clark Whitehill said: ‘There is a wealth of female talent available across the UK in every industry, all with great credentials, ambition and experience, including some very capable women dealing with very complex issues every day.

‘Businesses need to focus on changing their culture and structures to ensure they are making the best use of all their peoples’ skills regardless of gender and removing barriers, perceived or otherwise, to career development.’

Durrant said one area in which firms can improve their business structures and offer greater support, is through the development of mentoring programmes, which can help to develop and nurture young professionals and encourage them to aspire to reach their potential.

Pipeline

Separately, Pinsent Masons says its research shows the Financial Conduct Authority (FCA) received just 8,471 applications for 'approved person roles' from women over the last two years, compared to 38,493 applications from men.

'Approved persons' typically have significant influence over the firm's regulatory conduct and therefore occupy senior roles. The percentage of overall applications for female candidates has remained largely static at 18% of the total in 2016-18 compared to 19% in 2014-2016.

Pinsent Masons says that the research highlights the challenges that financial institutions face in filling senior roles with female talent. The figures come following the publication of a recent study by the law firm and the Fawcett Society that shows that a lack of gender diversity in senior roles is contributing to a shortfall in the development of pensions, insurance, and investment products that are relevant to women.

Men are more than twice as likely to hold stocks and shares (23% compared to 11%) and the gender pension savings gap is currently at 54%.

Carolyn Saunders, head of pensions & long term savings at Pinsent Masons, said: ‘The lack of women in senior roles means that products are rarely developed with female consumers in mind. This contributes towards a financial security gap for women who feel that the financial services industry is not relevant to them. There is an urgent need for the industry to better understand female consumers if we are to improve women's financial security and independence.

‘However, the number of women being proposed for senior positions is not improving, which highlights the challenge that financial institutions have around the pipeline of talent coming through. As our study shows, a continuing lack of senior females in financial institutions is likely to have repercussions way beyond the gender balance of those organisations.’

Report by Pat Sweet

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