FTSE 100 companies to have a minimum of 25 per cent women on their boards

Updated April 2011

Earlier this year Lord Davies published his report entitled "Women on Boards". This summarised the findings of his review into representation of women on the boards of UK listed companies, which it is expected will soon be incorporated into the UK Corporate Governance Code.

In his recommendations Lord Davies rejected the imposition of statutory quotas, such as those introduced in France and Norway. Instead he favoured the implementation of a "business led approach" of practical recommendations to improve female representation. These include:

• A target for boards of FTSE 100 companies to have a minimum of 25 per cent women by 2015.
• A recommendation that boards of FTSE 350 companies set their own targets for female representation by 2013 and 2015, and that these targets are announced by September 2011.
• A recommendation that UK listed companies generally should disclose the proportion of women on their boards, the proportion of women in executive positions and the proportion of women in the organisation as a whole.

Lord Davies also emphasised the importance of advertising non-executive positions to promote diversity and also the influence of executive recruitment agencies on the presentation of potential candidates. It appears apparent from the research conducted that current practice in these areas is seen as a major barrier to promotion of female executives.

Despite the ultimate recommendations it was noted in the report that the quota system brought in by Norway had been very effective in introducing a gender balance in boards of listed companies there. The report makes clear that the UK government has reserved its position as to gender quotas and their introduction has not been ruled out if the recommendations are not effective. As such, UK companies should ensure that they comply with the recommendations or they may find a new quota system imposed upon them.

See Related links for the full text of the report.

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at April 2011. Specific advice should be sought for specific cases; we cannot be held responsible for any action (or decision not to take action) made in reliance upon the content of this publication.

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