Five years ago, the UK sought to double female representation on the boards of large companies. According to a government review (pdf) of the effort, the voluntary target of 25% representation has been met (exceeded, even, at FTSE 100 companies, where women now hold 26.1% of board positions) and will be replaced with a new goal: having a third of all board seats filled by women in the next five years.
Boards play an important oversight role, but they are only part of the story when it comes to gender diversity in business leadership—and a small part at that.
Attention in the corporate world is firmly focused on another arena, more integral to how businesses are actually run: executive roles. There, women are still in a tiny minority—just 5% of FTSE 100 CEOs are female—leading to an intense discussion of when, and how, companies will finally bring more gender balance to the teams responsible for day-to-day management.
Board evolution is useful, but “getting women into executive roles is even more important,” says Tanuja Randery, president for the UK and Ireland at Schneider Electric, a French company that makes electrical equipment and software for energy management and automation.
In the absence of legally enforceable quotas, like those in place in Norway and France for directorships, companies have to make their own decisions about how important the issue of gender diversity is to them, and how they want to go about tackling it. Schneider is aiming for 40% female representation in its new hires company-wide, and 33% at the senior level. “It’s a huge mountain to climb,” says Randery, who worked in the telecom and technology industries before shifting to the energy and industrial sector. Female representation in her new industry is “not necessarily increasing yet, but I think people are starting to pay a lot more notice,” she tells Quartz.
“Addressing the all-important executive layer immediately below the Board has always been a longer term and more complex challenge,” said the Davies Review, the government report named for Lord Mervyn Davies, who chairs the steering group that set the initial 25% goal for boards.
The group faced criticism from some quarters for failing to set any executive targets to match director-level goals. But the review did acknowledge that it was now crucial to “extend the drive to improving the representation of women in the seniormost leadership” positions in FTSE companies. More analysis was needed, it added.
The review noted that the UK would fall behind its neighbors, including those where female board representation is mandated by a quota, if progress didn’t continue to be made on board diversity.