Vince Cable has accused the UK’s top companies of neglecting racial diversity in its boardrooms and urged business to use a wider talent pool when making senior appointments.
His comments came as the business secretary unveiled the latest statistics on women in the boardroom, which revealed that 20.7% of FTSE 100 directors are female, up from 12.5% in 2011.
Cable said: “I can think of very few black people at the top end of British business. What we’ve been doing with gender is right, but diversity is more than that. The area is neglected. It needs serious consideration.”
More than half of FTSE 100 companies have no non-white directors and two-thirds have no full-time minority executives at board level, a study found.
The study – by Trevor Phillips, former equalities commission chairman, and Richard Webber, of King’s College London – said UK competitiveness was put at risk by a lack of diversity in senior corporate roles, with just a dozen women occupying the 289 posts of chairman, chief executive and finance director in the FTSE 100.
In 2011, Lord Davies, ex-boss of Standard Chartered bank, was tasked by the government with improving the numbers of women in senior business roles and set FTSE 100 companies the goal of increasing female board membership to 25% by 2015.
The next biggest 250 companies were also encouraged to employ more female directors. Women account for only 15.6% of FTSE 250 directors and there are 48 boards comprising exclusively men.
The rise in the number of female directors is driven by the appointment of non-executives, rather than more women being hired as executive directors. Davies says only 6.9% of executive directors are female, up from 5.8% last year.
Even so, the campaign has been viewed as a success, especially as the rise in female directors has strengthened the UK’s argument against the imposition of compulsory quotas from the EU, and Davies committee members are now talking of a “final push to get over the finish line”.
Cranfield University, which provides the analysis underpinning the report, recommended five ways FTSE 100 companies could hire the 48 female directors needed to hit the 25% target, including pushing out board members after nine years in the same role.
Susan Vinnicombe, a Cranford professor who sits on the Davies steering committee, said: “There are 82 non-executive directors in the FTSE 100 who have held seats for more than nine years. The challenge for chairmen is to review this.”
John Heaps, of the law firm Eversheds, said: “Progress is still not translated into a ‘business as usual’ state where all candidates, whatever their gender, are assessed on equal terms. It is that residual bias that now requires attention.”
The release of the Davies report coincided with Thomas Cook making its own contribution to the improving statistics by appointing Annet Aris as an independent non-executive director.
Thomas Cook’s chairman, Frank Meysman, said: “We recognise the benefits of diversity and with Annet’s appointment the board comprises four women and five men, of which four are based in the UK, three in continental Europe, one in Turkey and one in the US, who have a broad range of skills and experience that are relevant to our business.”