Businesses must have higher a female representation at board level, and all listed companies should be required to measure their progress on improving gender diversity, a leading business group has suggested.
In a submission to Lord Davies, the Confederation of British Industry (CBI) said the UK Corporate Governance Code should be revised to ensure listed companies report on diversity on a ‘comply or explain’ basis. This would involve reporting progress against internally-set targets that reflect their company’s circumstances and having to explain if they fail to deliver.
Commenting on the proposals, CBI president, Helen Alexander, said: “Although women make up half of the population and more than half of university graduates, they remain woefully under-represented at board level. We need to see more women progressing through the ranks and do more to keep them moving along the career pipeline into the top jobs.”
A similar scheme to that proposed by the CBI, which is due to be introduced in Australia next year, has already resulted in a sharp rise in the number of female board appointments. According to the latest figures from the Australian Securities Council, 27% of new appointments were female in the first half of 2010, compared with 5% in 2009.
Alexander added: “Schemes such as flexible working, mentoring and networking have helped, but making progress at the very top levels of business will require more sophisticated talent management.
“What is needed is cultural change, not quotas, ratios or tokenism. This is why we are calling for a flexible system that will allow firms to set targets that reflect the realities of their businesses.”
© Crimson Business Ltd. 2010