Diverse leadership leads to diverse thought; though this is widely acknowledged, according to The Guardian, more than 17 FTSE 100 companies are still behind agreed on targets to bring (at least) one board member from an ethnic minority background on by 2021 - “one by 2021”.
In 2017, The Parker Report recommended revisions to the Financial Reporting Council that have rewritten the UK corporate governance code - many of these changes demand more accountability from companies around senior appointments. In a 2018 letter to the FRC, The Parker Committee underpinned the changes by stating the overall responsibility that companies have to society as a whole, not just themselves.
“Ethnic diversity needs to be given the same level of board room focus that finally led to increasing female representation on boards, which has seen real progress in recent years.” - SirJohn Parker, Chairman of the Parker Review Committee.
In 2017, over 50% of FTSE 100 boards (51 out of 100 companies analysed) had no ethnic minority representation on their boards. This compares to 37% of FTSE 100 boards in 2020 (31 out of 83 companies surveyed). The latest data reveals that, since the 2017 Review, 11 additional FTSE 100 companies now have an ethnic minority director on their board. The Parker Review Commitee led by Sir John Parker, has noted that as of March 2021, 83 companies now have ethnic representation on their boards, leaving just shy of a fifth of boards still to hit this target by Nov of this year.
The Parker Review Committee also found that persons of ethnic minority background held only 15 chairman or CEO positions in the FTSE 350. There is a long way to go to advance ethnic minorities through executive leadership and into the boardroom. Diversity is vital for pushing representation of people and increasing voices at a higher organisational level.
Ending all-white boardrooms for the following 250 companies have a deadline of 2024 and is someway off course and will be reviewed at the end of 2021.
Are you struggling to diversify? Or are you meeting the challenge? We’d love to hear from you.