There is no reason to suppose that how things are today is how they will be tomorrow. Modern politics should teach us that much. Let’s hope that’s true. For if we ask if there are any lessons to be learnt from the characteristics of the women who Chair FTSE 250 companies today it makes disheartening reading for those making their way through corporate Britain. Of the existing population of female chairs a number had set the seal on their futures very early in life. A staggering 29% were Oxbridge educated (and 33.3 of all those educated in a British tertiary institution), 16.6% obtained an accountancy qualification and 25% chose to become bankers.
Clearly the sample pool is very small. Only 6.86% of the total number of FTSE 350 Chairs are female. Do the figures change significantly when the pool enlarges? If we next look at the women who are Senior Independent Directors (19.14%) on the Boards of UK plcs then the figures do shift – a little. We find a mere 22% with Oxbridge educations (rising to 27% if we look only at those educated in a UK tertiary institution). Some 15% chose to take an accounting qualification and bankers comprise just 22% of the total. These are large proportions. Of course, a number of the organisations we have considered require their boards to be able to demonstrate financial expertise. Since the UK economy is skewed towards financial services where the regulator is risk averse when it comes to Board composition, we cannot be surprised that a disproportionate number of Directors have pursued banking careers. In an increasingly regulated environment the presence in the UK boardroom of a handful of female lawyers and compliance specialists is, again, not a surprise.
The role of a Non-Executive Director, especially the Chairman, requires someone with a holistic approach to business and to the Board. Roles in advisory or professional services firms offer some of this breadth. In the corporate world, being a Chief Financial Officer who bypasses the CEO role and goes straight into a Chairmanship is a well-trodden path amongst male Chairs so why should it be otherwise with women? The CFO has the benefit of a vantage point across the entire business and, as Boards increasingly follow the US model with the only executives on the board being the CEO and the CFO, then a stint leading the finances gives invaluable boardroom experience which is not as readily available to outstanding peers in other disciplines.
So, there are explicable reasons why the women who have attained Chairmanships and Senior Independent Directorships on the boards of UK plcs are worryingly homogenous and not really diverse at all. Some might employ the old adage that women to get to the top have to be twice as successful as men – might this explain the high incidence of highly qualified women whose education has been in the elite institutions of the country? Experience in an elite organisation or institution is a useful shorthand for recruiters – a suggestion that at an earlier point in their career, these individuals were judged outstanding. We are looking at people who have long gone past the early career hurdles – but those early won achievements are an extraordinarily stable currency, the value of which rarely seems to go down. In similar vein, four of our (very small number of) female Chairs are also Senior Independent Directors and four of our SIDs are the SIDs on more than one board. Prior experience is, not surprisingly, appealing. Indeed, would we want a first time Director as either Chair or SID – that would seem a reckless appointment.
This is not, of course, the whole picture. There is a smattering of people with oil and gas or retail experience, there are Americans, Australians, New Zealanders, French and South African women in the mix. Some Directors began their careers in sales and marketing and some in consulting. Almost all have a degree and most have served extensively on Boards in a Non-Executive capacity. There is a fine balance to be struck between people who demonstrate excellence, bring relevant experience as well as ensuring diversity of thinking and approach. And, in the end, what do the numbers really tell us? Perhaps we should assess birth order, sporting prowess, any number of attributes which make up a total experience set and personality. Or we could overlay this with personality types from Myers Briggs. Diversity comes in many forms, not all of which are necessarily readily quantifiable, and we make a mistake if we assume that two people who happen to share some characteristics will inevitably think alike. Indeed, two people who share many characteristics can make decisions which are poles apart. To end where we began – modern politics should have shown us that much.
Judith Osborne is a Partner in the Board Practice of Stonehaven. She specialises in Board appointments with a particular focus on consumer facing businesses.