Gender balance flips in boardrooms with women the majority of independent directors

December 13, 2021

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Women now account for a majority of independent directors at Britain’s largest public companies, research has found.

The biggest 150 groups listed on the stock market now employ 442 female non-executive directors, compared with 422 men, a report from Spencer Stuart, a headhunting firm, shows.

The gender balance among non- executives has flipped after boards embarked on a hiring spree in the year to April. Fifty-two per cent of newly appointed directors were women, with 15 boards achieving gender parity, five more than the previous year.

Women now make up 36 per cent of all directors, including chairwomen and executive directors, compared with 24 per cent in 2016 and 12 per cent a decade ago.

Britain’s largest listed companies have made progress in making their boards more ethnically diverse. The proportion of first-time board directors from minority ethnic backgrounds rose to 25 per cent in the 12 months, Spencer Stuart said. However, companies have some way to go before redressing the imbalance. Only 21 per cent have two or more minority ethnic directors and 39 per cent have none.

Although there is more gender diversity in the ranks of independent directors, the “picture is less rosy” at the executive level, according to the report. Only 14 per cent of executive directors were women, the same level as the previous year. Eighteen per cent of newly appointed executive directors were women. Of the nine women appointed to executive roles last year, seven were chief financial officers.

Liv Garfield, the boss of Severn Trent, and Admiral Group’s Milena Mondini de Focatiis are relative rarities: there are now 12 female chief executives at the top 150 FTSE companies, only five more than a decade ago, and 22 female chief financial officers. Men hold the four most senior positions at 64 of the top 150 companies and there are only 14 chairwomen, including Baroness Vadera at Prudential.

Twenty-six per cent of senior independent directors were women, down from 34 per cent.

The report also said the average tenure of a chief executive in Britain was 5.8 years, and 5.7 for a chairman or woman. The average annual remuneration of a chairman or woman was GBP372,980. This is 6 per cent below the previous year, mainly because of cuts in the pandemic.