executive

Boardroom Gender Diversity slow progress means parity 20 years away

10 February, 2017 By WiC

Consitent Growth but ….

UK companies are recruiting fewer women to boardrooms as gender diversity progress stalls for first time. Of the new recruits to UK boards in 2016, 29 per cent were women, down from 32.1 per cent in 2014 and 31.6 per cent in 2012, according to the Global Board Diversity Analysis report which is published every two years by recruitment firm Egon Zehnder.

It is the first time that the rate of improvement in gender diversity has declined in the UK since Egon Zender began collecting data in 2004.

However, the report said that the UK has achieved “consistent growth” in terms of the percentage of women on boards.

According to data compiled by the firm, there were no female executive board chairs in the UK last year, compared to a global average of 5%. The percentage of non-executive chairs on UK boards fell from 2% to 1%.

The percentage of committee positions held by women was more encouraging, at 24.7%, with 14.6% of them being chairmanship positions.

Moreover, 7.8% of UK chief executives were female in 2016, and 13.7% were chief financial executives. The global average was 3.8% and 10.5% respectively.

Gender parity 20 years away

In 2016, the average board size globally was 11.5, with an average of 2.1 female members.

If progress continues at the rate Egon Zender has seen globally over the last two years (1.6 percent per annum), the average number of women per board will reach three by 2021, while gender parity remains 20 years away.

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FTSE350 companies to increase female board representation

7 December, 2016 By WiC

With FTSE 350 companies now asked to build the representation of women on their boards to 33% and British business in its sixth year of progress to increase the number of women in the boardroom, it is time to apply a similar framework to improving the number of women in the all-important leadership roles below the board.

The Hampton-Alexander Review (the Review) will build on the success of voluntary business-led approach of the Davies Review for Women on Boards, extending the scope to include FTSE 350 Executive Committees and the Direct Reports to the Executive Committee.

Focus now on Executive Pipeline

Although the approach is similar, making progress in the executive pipeline brings new challenges. There is a lack of public disclosure on gender performance at senior levels, particularly in the FTSE 250, so data gathering and the reporting of FTSE progress is a largely manual task. There are new stakeholders in CEOs, HR Directors and aspiring women to engage and a growing awareness of the multiple barriers to women in the workplace in seeking to progress through the ranks.

However, the good news is that almost all of the FSTE 100 chose to share their progress and it is evident that many companies have had significant efforts to improve the pipeline underway for some time. There is a healthy turnover of appointments at both the Executive Committee and in the Direct Reports at around 17%, albeit based on one year of data; and the appointment ratio of women to men is between 27% and 30% – again with some need for caution given the figures relate only to one year.

There are 12 All-male Executive Committees in the FTSE 100 which seems disappointing against a backdrop of British business having taken significant steps to ensure gender balance on their Boards. It is also disappointing there were insufficient data disclosures from the FTSE 250 to set a reliable starting point and baseline upon which to build.

The Recommendations set out in this report are a call to action for all stakeholders; FTSE CEOs and their companies, Government as regards public disclosures, Investors and Executive Search firms, all of whom have a key role to play in driving progress.

All the Recommendations relate to the FTSE 350 group of companies.

However, the new target announced of 33% women’s representation on the Executive Committee and in the Direct Reports by 2020, is for the FTSE 100 only at this stage. Although all companies will be asked to report gender performance separately for the Executive Committee and in the Direct Reports, the target is a combined one across the two populations.

Of course all companies will be starting in different places, with many already at 33% or above and others nearer the start of their journey. Despite this there is overwhelming support for the direction of travel and it is clear that the important thing is just to make a start.

There is a ‘How to’ section for companies to consider when starting on their journey, some inspirational CEOs, voices all of whom have already made good progress and share their thoughts, and three case studies setting out the value of a strategy, the right data and targets.

There are two excerpts from emerging research on bias, myths and realities. Not only are these interesting studies in their own right but demonstrate the complexity and depth of understanding now developing on the women in leadership agenda.

FTSE100 pace slowing

The focus of the Review’s first report is on the executive pipeline, but also reports on the progress on Women on Boards of the FSTE 350 as at 1st October 2016.

The pace of increase on Women on Boards has slowed in the last 12 months, particularly in the FTSE 100. The FSE 350 overall is at 23%, up from 21.9% this time last year. The FTSE 250 is at 21.1%, up form 19.6% with the FTSE 100 only marginally up at 26.6%.

There may be a degree of complacency with the FTSE 100 having reached the 25% target in 2015 and taking time to gear up to the new 33% target.
However, in uncertain economic and global times businesses are increasingly aware of the value of diverse perspectives.

UK strong player internationally

In the international arena the UK continues to be a strong player and admired for having made such progress under a voluntary regime. Companies will now need to redouble efforts in 2017 to stay there.

More to be done

As the Review launches its Recommendations in this report, British business starts in a good place, but clearly there will be challenges ahead and there is much more to do if companies are to harness the full extent of women’s skillset for the benefit of business and the UK economy.

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7 out of 10 Ethnic Minority Leaders Experienced Discrimination En Route to the Top

19 July, 2016 By WiC

Recently published research on the views of ethnic minority senior executives and board leaders on workplace barriers reveals bias is part of the cultural norm.

The survey from Harvey Nash’s Engage network, representing leaders from all ethnic backgrounds, shows seven out of ten (71%) experienced ethnic discrimination in their career that has meant they have had to work even harder to reach board level or the most senior positions.

The findings highlight an unfair playing field tipped in favour of white men.

Nearly two-thirds (63%) of ethnic minority leaders believe that the unconscious bias of CEOs and boards – which are 74% male and 95% white in the FTSE 100 – is hindering ethnic minorities from progressing to board level.

It also highlights the existence of an ‘old boys’ network.

Sixty-two per cent of respondents believe that ethnic minorities are not in the circles or on the radars of leadership teams and executive search firms, meaning they are unlikely to be considered for board positions and businesses are missing out on a huge talent pool.

These figures emerge following a recent Equality & Human Rights Commission (EHRC) Inquiry that found just 13% of FTSE 100 companies provided training on equality law and avoiding unconscious bias to those on the board involved in appointments and almost a third (32%) of businesses continue to rely on personal networks to identify candidates.

In light of the recent EU Referendum result, the research presents a worrying backdrop as nationality and ethnic background have drawn the media’s attention.

Improving diversity requires commitment from the very top of an organisation.

However the research points to lack of action from the CEO and board with over half (52%) of respondents believing that CEOs and leadership teams do not see the business benefits of diversity to the bottom line despite numerous academic and other studies such as McKinsey’s Diversity Matters.

The top three recommendations from the research to improve diversity on boards were:

Target recruiters to include diversity on shortlists (36%)
Educate CEOs and boards on the value of diversity (32%), and
Insist on transparency and reporting on both the full recruitment process and ethnic diversity at executive and board level (28%).

Peter Reichwald, founder of Engage and Director at Harvey Nash Board Practice said:

We should be deeply concerned by the evidence from the most senior ethnic minority leaders suggesting recruitment and promotion is not necessarily based on merit, but what you look like. Despite these barriers, these individuals have made it to the highest levels and we must ask ourselves if this is what we want for future generations.

There is a clear mandate for boards and executive search firms to search wider and harness the vast talent pool currently over-looked, reinforcing the role of Engage. But there is a role for all of us to recognise there is an ethnic bias in business and we must take action to create a level playing field where individuals are not barred by factors out of their control.

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Increase your impact in the board – three strategies get you there

23 June, 2016 By WiC

“Dr Sabine,” tell me “Do I look like father Christmas?” My client Paul (name changed) put a smile on my face. The 5.8 foot, slim, dark haired guy in his mid forties didn’t look anything like the guy we all know from the Coca-Cola ads.

I had to say he didn’t, and we were right in the middle of our coaching conversation …

The session was a sharp reminder of the mistakes executives, who are one or two levels below the executive board, make when what they intend is just the oppositite. They want to leave a good impression but more often than not fail to do so. Instead of using the limited time they have with a member of an executive board to leave a good impression they all too often fall into the traps and do what all their colleagues do.

In this short article I want to highlight three strategies that will help you to increase your impact and leave the right impression.

Strategy 1: Change perspective – put yourself in the shoes of a member of the board

The day of a member of a board in a large corporation is made up of 20 minute slots. It is by far not uncommon that s/he has 20 meetings in the diary in one day. People come, people go.

Paul was at the end of a long day. He could not think of a single person who he talked with who cared to put her/himself in his shoes and bring something of value to him.

He wanted to explore in his coaching session what he could do to educate executives how to best use the time they have with him. For him it was sheer madness how all these people choose to use the time with him. Paul described to me how he would have never dared to have a meeting with a member of a board and waste it to complain, ask for something and serve excuses for weak results.

He employed a simple trick.

Before any meeting with a member of the executive board he spent a good half hour to put himself in the shoes of the board member. What keeps her/him awake at night? What issues does s/he currently have on the table? Where does his/her pressure come from – investors, competition, suppliers, union …?

Once he was clear in his own head about the real current concerns of the board member he started to craft his key messages.

Stragegy 2: Think results and achievements rather than what you have done

Most clients want to talk about what they have done, how hard it was to get there, what obstacles they had to overcome and how they struggled with the limited resources. Over 80% of their thinking and preparation circles around the input factors and only 20% output i.e. results. This is exactly what Paul experienced.

Now listen to what Paul did before he was apointed to the executive team.

At the start of any project I was involved in I established the baseline. I worked together with other departments to get numbers on the table. At times this was not easy and quite tricky but I became friends with our Controlling guys and was always quite smart in making use of consultants who were running around in our organsiation (he laughed and had a twinkle in his eye).

When Paul worked on any project he tracked numbers and at times even created key performance indicators. This way he could always report actual results.

He then used the time he had with members of the executive board to talk about the actual results and communicated clearly how they relate to the issues that concern the member of the executive team (Strategy 1).

Strategy 3: Communicate concisely

Most board members are quick on their feet and can cut through the chase … they want the essence and not all the waffle. Focus on the key points and take the first two strategies to heart.

Because Paul put himself in the shoes of his board members and knew the numbers he could communicate concisely.

He described that this actually allowed him to get to know the board members as there was always time to talk about sports, holidays and the weekend. He even describd a situation where he looked at his watch, saw that he just used 12 minutes and said, “You know what Sue (name changed), I presented you with all the information why don´t you just take a little walk instead of listening to me.” He managed again to put a smile on someone’s face.

When I listened to Paul I can clearly see why he got where he is.

I would like to help people who are eager to develop their career, have an impact in the board room and leave the right impression. I believe that these three strategies will take you a long way and maybe get you even a seat on the table.

Contact Dr Sabine Dembkowski to discover how Better Boards can help you to make your mark.

Better Boards’ partner, Dr Sabine Dembkowski says

“At the centre of our attention is the individual leader. All of our services are designed to help him/her to create value in their visible and exposed roles.”

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