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3 December 2020updated 28 Aug 2021 9:27pm

Revealed: Britain’s economy of men

A New Statesman data investigation finds only one in four boardroom seats in Britain is taken up by women. 

By Michael Goodier

Only one in four boardroom seats in Britain is taken up by women – and British businesses are unlikely to reach equal representation for 30 years, a New Statesman data investigation has found.

One-third of large employers in the UK have no female company officers at all and, among firms with more than 1,000 employees, there is no industry in the country in which women form a majority of board members. 

The analysis of records from Companies House, which holds the details of every company officer in the UK, found only 25 per cent of seats on the boards of companies with more than 1,000 employees are taken by women, falling to 24 per cent if all corporate positions are included.

 

The research also broke down the figures by different industrial sectors to reveal areas of inequality. Companies in the education sector had the best-balanced boardrooms, with 38.4 per cent of directors in large employers being female. Those working in human health and social work (37.5 per cent), and those in other service activities, including trade unions and other membership organisations, also had a relatively high – but still unequal – level of representation.

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The worst industries for female representation include construction, where 17 per cent of directors of large companies are women, as well as transportation and storage (19 per cent) and manufacturing (19 per cent).

 

Of 2,211 large employers, 753 had no female company officers at all, the analysis found. These included the retail giants Iceland, B&M and Boots UK, each of which employs more than 20,000 people.

B&M does employ women in roles reporting directly to members of its executive committee, but has no women executives, according to the 2019 Hampton-Alexander Review into the FTSE 350.

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Our analysis did show some progress on female board representation over the past decade. In 2011, just under 18 per cent of non-corporate board positions were held by women, and this has increased by around a percentage point each year.

 

But progress is slow. In 2016, the Hampton-Alexander Review made five recommendations aimed at increasing the number of women in leadership positions of FTSE 350 companies.

The initial report called for a minimum of 33 per cent women’s representation on FTSE 350 company boards by 2020. While the New Statesman’s analysis is broader than the FTSE 350 (looking at all employers with more than 1,000 employees), if the same 33 per cent target was set, at the current pace of change it would not be met until 2030.

And if the rate of change over the past five years does not increase, women will not have equal standing in the boardrooms of Britain’s major employers until 2050. 

 

Sam Smethers, who is chief executive of the gender equality charity the Fawcett Society, said: “We know that better female representation and diversity in top positions and on company boards improves company performance.

“In recent years, some progress has been made on non-exec director positions, but women in executive roles are still woefully under-represented. We have long argued for quotas to improve board representation coupled with targets and positive action to address under-representation in top exec roles.

“Without action like this, change will, at best, continue at a glacial pace.”

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As well as slowly becoming more balanced in terms of gender, Britain’s company officers are also getting younger. In April 2020, the average age of a company officer in Britain’s biggest companies was 54 – down from 60 in April 2011. The youngest industries are mining and quarrying (average age 48), while company officers in the education sector have an average age of 58.

The vast majority of board spaces (84 per cent) are currently taken up by British nationals. That was followed by American (3 per cent), Irish (3 per cent) and French (2 per cent).

The analysis also revealed that not only are Britain’s largest employers mostly run by men, many are run by the same men.

Of UK companies with more than 1,000 employees, 39 per cent share at least one company officer with another large company. More than 400 companies share a board member with several others.

The phenomenon of “interlocking directorates” – in which different companies share directors – is legal and commonplace. However, it does create opportunities for conflicts of interest and issues with the independence of decisions made in boardrooms.

A 2012 study by researchers at the University of Exeter found that when company directors “over-board” – take on too many roles – it can compromise their ability to focus on an individual company, with measurable effects on that business’ performance.

However, the study also found that ties between company boards can help with the dissemination of ideas and innovations between companies – but only if the boards themselves were sufficiently diverse. To keep up with a rapidly changing economy, the structures and cultures of British companies also need to change.