Fidelio Table Talk – Tenacity & Diversity

July has been a month of climate extremes and political volatility. But the diversity challenge has never been far from the surface:

  • Ursula von der Leyen, President-elect of the European Commission, committed to “full gender equality in [her] college of commissionersin a speech on 16th July, asserting that “if member states do not propose enough female commissioners, [she] will not hesitate to ask for new names”.
  • Boris Johnson, newly appointed UK Prime Minister, in his first days in office has also announced what has been described as the youngest, most ethnically diverse and one of the most gender balanced cabinets in UK history.

And in business the hard work towards increasing gender balance and diversity goes on – there are no silver bullets.

Fidelio is pleased and committed to contribute: through Search, Evaluation and Development.

Hampton-Alexander Review

1st July brought the release of the Hampton-Alexander Review’s 2018 data. Since 2016, the Review has set FTSE 350 companies a target of achieving a gender balance of 33% women on Boards and Senior Management teams by the end of 2020. Here progress has clearly been made, with 32.1% of FTSE 100 Board positions now held by women, and 27.5% of FTSE 350 Board positions.

But there remains a way to go. Although a great drop from the 152 all-male Boards of 2011, four FTSE 350 companies still do not have one female Board member. And a further 14 boards have only one woman.

Female FTSE Board Report

This deficit was highlighted Cranfield University on 11th  July, in a press release for their Female FTSE Board Report 2019 “’Tick box’ attitude to women on FTSE 100 boards must stop”. Cranfield’s flagged the risks of tokenism and identified the following alarming trends for female directors:

  • Female directors remain in their roles for shorter periods of time,
  • Are less likely to be promoted than male counterparts,
  • And are disproportionately white (89%).

Surely a major clarion call to the Nominations Committee!

Gender Equality Roadmap

Recognising the extent of the diversity challenge, the UK government also provided guidance with its Gender Equality Roadmap (published 3rd July 2019). The report underscores there are no silver bullets to achieving gender diversity in the workplace and argues that to build strong pipelines the focus on equality must start early and continue through all aspects of working and family life.

This was also a theme at Fidelio’s recent Board breakfast with Professor Lesley Regan, President of the Royal College of Obstetricians and Gynaecologists. Lesley argued there is much that business can do to contribute to better healthcare provision for women which in turn will increase gender balance in our companies.

A Global Perspective

Nor is this focus confined to the UK. Recently published research in Australia, AICD Gender Progress Report, found that four ASX200 companies have all-male boards, and 50 only retain one woman. The 30% Club continues its excellent cross-border, cross-cultural engagement to increase women at the top table, with a recently opened Chapter in Japan. Here women account for only 4.1% of board members at listed companies and, as of 2018, the Japan’s Corporate Governance Code requires companies to improve gender balance at the top level or explain their absence to the TSE.

Diversity Clearly Makes Good Business Sense

This tenacity is critical. As UK Business Minister Kelly Tolhurst commented, “diversity makes good business sense,” contributing to outperformance and minimising the risk of group think.

Research has shown that firms with top-quartile executive-level diversity are 20-30% more likely to outperform peers, that mixed-gender investment fund teams attract 6% greater inflow than all-male teams, and that firms with monocultures are 24% more likely to encounter governance-related issues than diverse peers.

The value of diversity is clear but the pace remains too slow. Tenacity is essential.

Fidelio has been proud to demonstrate both tenacity and commitment in achieving gender balance and cognitive diversity:

  • 50% of our searches result in female appointments
  • Fidelio’s “A Seat at the Table” is now in its seventh iteration, developing highly effective Board Members who are well positioned to promote diversity and with early alumni succeeding to chair and CEO roles
  • All our Board Evaluations explore the Board’s diversity of thinking and composition and make practical recommendations on the Board’s role in increasing effectiveness and diversity
  • Fidelio has twice been accredited by the Hampton-Alexander Review for our contribution to Board diversity beyond the FTSE350

To learn more about how Fidelio can support your Board and company in increasing its diversity, please contact gkarrancumberlege@fideliopartners.com.

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