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The Female FTSE Board Report 2016
Chairmen, CEOs, directors, executive search firms and subject-matter experts
7
identified key drivers of
success as:
––
Setting targets that are ambitious yet realistic
––
Monitoring progress six-monthly
––
Effective championing by Lord Davies and his Steering Group
––
Multiple stakeholder engagement
Moving forward, progress must be made by building on the same principles and by expanding the focus
to women on Executive Committees and in senior leadership roles. The intense public scrutiny generated
by the Davies Review at board level needs to expand to lower organizational echelons. A recent EHRC
inquiry
8
found that FTSE 350 companies are more likely to have diversity policies at board level compared
to senior management level; only 57% of FTSE 100 companies and 42% of FTSE 250 companies have
diversity policies for their senior management teams. This demonstrates the need to adopt a more
disciplined and goal-driven approach below board level. While quotas remain incongruent with the UK’s
approach and business culture, target setting at board level and below is crucial to sustainable change.
But what are the differences between targets and quotas?
Targets for Gender Balance
TABLE 16. LEGAL AND PRACTICAL DIFFERENCES BETWEEN
QUOTAS AND TARGETS
9,10,11,12
Quotas
Targets
Definition
––
fixed percentage or number imposed by the
State to ensure representation of women,
time bound and with sanctions
––
contrary to commonly-held beliefs, quotas do
not entail selecting a candidate only because
of their gender; the proposed EU directive for
gender balance on boards calls for companies
to give priority to the candidate from the
under-represented gender only if equally
qualified
––
do not entail discrimination against men or
positive discrimination towards women
Definition
––
voluntary aspiration identified and pursued by
organizations, without regulatory sanctions
imposed by the State
––
enable positive action and ‘tie-break’
provisions whereby a company can treat
a candidate from an under-represented
group more favourably during recruitment
or promotion processes, only if two or more
candidates are equally qualified
––
do not entail discrimination against men or
positive discrimination towards women
Assumptions
––
rely on the assumption that you need to
change the numbers and ensure a critical
mass, in order to eventually change the culture
Assumptions
––
rely on the assumption that you need to
change behaviours and organizational
processes, in order to change the numbers
and the culture
Pros and Cons
––
address an intractable problem when other
measures have failed, ensuring representation
and critical mass, thus lowering risk of
tokenism
––
send a significant symbolic message
from government or regulatory body that
introduces them
––
perceived as an imposition to business and
unmeritocratic (an emotional rather than
rational response)
––
initially met with resentment, and generally
normalised post hoc
––
adoption can be relatively swift and uniform if
legal penalties are in place
––
progress is resilient as enforced by law
Pros and Cons
––
can be more nuanced than quotas, and
tailored to different pipeline challenges and
talent management processes, rather than
just the outcome
––
incremental increases in gender diversity bring
higher risk of tokenism
––
perceived as business-driven and business-
owned, which increases likelihood of buy-in
from multiple stakeholders and acceptability
once adopted
––
adoption can be slower or uneven across
companies without pressure (champions,
roles models, public scrutiny)
––
progress is fragile; intense championing and
public scrutiny is needed to keep up the pace
of change