Smaller companies lag on diversity at boards
A new study by Women On Boards UK reveals that progress on diversity at boards is “painfully slow”. Less than half of listed firms outside of the biggest 350 companies in the UK have met targets for women in their boardrooms and a shocking 54% still have no female top executives, research has revealed.
The report ‘The Hidden Truth: Diversity & Inclusion in the FTSE All-Share’ examines data for all companies below the 350 in the FTSE All-Share, as well as the gender pay gap reports for all FTSE All-Share firms that produce them – both for the first time.
Research showed that while solid progress has been made within the UK’s top 100 and 250 listed firms, diversity is still woefully behind in the wider FTSE All-Share. “The data reveals a stark ‘diversity divide’ between those firms who are making progress on board diversity – and those who are not,” researchers say.
Specifically the study found that in the 261 FTSE All-Share firms below the FTSE 350:
- under 50% have met the target for 33% women on boards;
- more than 50% have an all-male executive leadership team;
- just 16% have any ethnic diversity on their boards;
- and 37% have one or no female board members.
“Progress on board diversity has been painfully slow, yet, recently, there has been a creeping sense that what has been achieved is ‘enough’ and no more effort is needed,” notes Fiona Hathorn, co-founder and CEO of Women on Boards UK.
“This report categorically shows that more is absolutely needed. It exposes the hidden truth that, beyond the overall number of female non-executives, progress has been extremely limited. Our data also reveals a very significant proportion of FTSE All-Share firms are achieving little, if any, meaningful change as regards to diversity and inclusion,” Hathorn says.
An even more worrying gender pay gap
When it comes to the gender pay gap, things are actually worse in the FTSE All-Share than the national average, and highest of all in the FTSE 350. Even though the bigger firms have more diversity, their average gender pay gap is 20.2%, compared to 17% in the smaller firms and the national average of 13.7%.
Analysis of the gender pay gap reports highlighted some clear reasons that this high pay gap persists year-on-year. Researchers said that looking at the quality of gender pay gap reports in those 261 smaller caps, many demonstrated “a low priority; low transparency; and were lacking in action”.
“These are clear, if unacceptable, explanations for why their pay gaps are so high and static. Yet other firms do demonstrate high quality and innovative action,” they added.
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