Monday, January 24

Time is running out for FTSE 100 companies to reach deadline to end all-white boardrooms | corporate governance

Time is running out for FTSE 100 firms, including British Airways owner IAG, BAE Systems and JD Sports, to appoint at least one color director before the year-end deadline, after a Analysis showed that almost a fifth of the UK’s largest listed firms were leaders. by all-white boardrooms.

An update to Parker’s review, a government-backed report on ethnic diversity in the boardrooms of publicly traded companies, showed that 81 companies from the FTSE 100 had met the voluntary target of “one by 2021,” compared to 52 last year.

Yet 19 companies, including home builder Persimmon and asset manager M&G, have just nine months to meet the minimum standards set by the review. Three of the 19 companies did not provide data on their levels of diversity, including Just Eat and the retailer Next.

Karan Bilimoria, CBI president and its first black and ethnic minority boss, said: “This is an important milestone, but no work has been done. Businesses must maintain momentum with actions to improve ethnic diversity at all levels, developing talented future leaders from across society. We need to see those latter companies do what the vast majority have already done, and end the boardroom completely blank. “

Parker’s review, which was released in 2017, gave FTSE firms 100 until the end of 2021 to appoint at least one non-white board-level director. The same target was set for the FTSE 250 companies, but with a 2024 deadline.

While Parker’s review committee praised the “significant progress” made by companies in the past 12 months during the pandemic, the total number of BAME directors holding the highest positions on the board remains surprisingly low.

People with a BAME background hold just 124, or 12%, of the 998 director positions on the FTSE 100 index. That’s an increase of 98, or 9.7%, from the 1,011 positions last year. There are only five ethnic minority CEOs who lead FTSE 100 firms, all men. Among them are Iván Menezes from the alcoholic firm Diageo, Octavio Alvídrez, head of the Mexican mining company Fresnillo, and Iván Arriagada from Antofagasta.

However, as Green Park, the diversity consulting and recruiting firm, revealed in February, there are no black executives in any of the three top executive positions on the FTSE 100. That’s despite calls for greater representation of people from around the world. Black origin after the resurgence of the Black Lives Matter movement, sparked by the murder of George Floyd by Minneapolis police last year.

Parker’s review has not revealed the proportion of black representation in its own statistics, but Sir John Parker said that the review would request that data from the FTSE 100 and FTSE 250 in the future.

Parker said a lot had changed since he appointed a BAME director to the Babcock board more than 20 years ago, and brought Dipesh Shah on as a non-executive in the late 1990s, but there was much more to do to improve. the gender. and ethnic diversity.

While companies have become more “comfortable” with the diversity of the boardroom, Parker said the next step was to ensure that more women and BAME candidates moved up the corporate ladder to executive positions.

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However, he said, it was important to congratulate companies and headhunters for their efforts so far. “There has been a great commitment.”

Shareholders are also pushing companies to make progress, given evidence that companies with more diverse boardrooms perform better than those of whites and men.

The Investment Association, which represents asset managers with more than £ 8.5 trillion under management, said it will “continue to engage with publicly traded companies to understand how they plan to meet Parker’s review targets.”

FTSE 100 companies who have not met the objectives of the Parker review

* Indicates companies you did not provide the data requested by Parker’s review

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