Only 85 of the 1,050 top director positions in FTSE 100 firms are held by a person of colour.
A new, government-backed review has called upon FTSE 100 companies to improve their diversity. It has urged these businesses to appoint new directors from BAME backgrounds.
Created by The Parker Review Committee and led by Sir John Parker, the report focuses on bringing an end to all-white boardrooms. With a clear-cut aim of making them more diverse by 2021.
Titled as A Report into the Ethnic Diversity of UK Boards, the report’s findings became published on 12th October 2017.
Worrying findings have arisen from its research. For example, only 85 of the 1,050 top director positions in FTSE 100 firms are held by a person of colour.
This means only 2% represents those from an ethnic minority background. However, BAME (Black, Asian and Middle Eastern) UK citizens make up nearly 14% of the population. It appears then, these companies need to do more so their boardrooms represent society fairly.
The report further highlights that just 51% of the top UK firms have no employees from ethnic minorities on their board. In addition, only 6 individuals from BAME backgrounds held a CEO or Chair positions. Sir John Parker commented in the report:
“UK companies have made great improvements on gender diversity but much work needs to be done towards ethnic minorities.”
With these findings, the review now calls for change from major companies in the UK. FTSE 100 firms have four years to improve their diversity at boardroom level. This change should reflect society and their own workforces.
At the launch of the review, Business Minister Margot James added:
“So many people are being denied opportunities that should be available to them. It is not right that boardrooms can still be predominantly male and exclusively white.”
As a result, The Parker Review Committee lists three main recommendations:
- Increasing ethnic diversity ~ The report proposes that FTSE 100 businesses should appoint a board member from BAME backgrounds by 2021.
- Development ~ Building a pipeline of candidates, encouraging those from ethnic minorities for succession.
- Transparency ~ Encouraging openness by producing annual reviews. With companies also disclosing information if they fail to meet the 2021 targets.
This review echoes that of racial inequality from the UK’s first racial audit that was backed by the government recently. It revealed how BAME candidates face less likelihood of employment, with suggestions that Pakistani women have not integrated enough into UK society.
It sheds further light on the issues of BAME graduates who are also facing struggles with employment. A recent study found that they faced major job gaps in the labour market, despite the increase in those from ethnic minorities gaining degrees.
With these recommendations now set out, many will hope this will act as a much-needed wake-up call for these top firms. Where they place more focus on diversity and attain a more inclusive boardroom, equal of all races and genders.
Read more of A Report into the Ethnic Diversity of UK Boards here.