October 8, 2019 Diversity: Celebrating a 30% milestone
If you were looking at the makeup of FTSE 350 boards in 2010 you may have noticed that just 9.5% of directors were women. In a bid to address this, Dame Helena Morrissey founded the 30% Club with the aim of implementing “a collaborative, concerted business-led effort to help accelerate progress towards better gender balance at all levels of organisations.”
Targeting a minimum 30% female representation by 2020 the Club has since grown internationally, taking its message to fourteen countries across the globe. Now figures from the London Stock Exchange (LSE) have revealed that as at September 2019 the 30% female representation target has been reached in the UK.
Commenting on the figures the Global Co-Chair of the 30% Club, Brenda Trenowden, said: “This is an incredible milestone on the journey towards greater diversity and gender parity on company boards” adding “gender balance on boards and in senior management not only encourages better leadership and governance, but ultimately increases corporate performance for both companies and their shareholders.”
When we look at questions of diversity it can be all too easy to see them purely in terms of statistics and targets, or perhaps as a tick box exercise in response to societal pressure. In fact PwC’s 2017 ‘Diversity and Inclusion Benchmarking Survey’[1] revealed that 18% of financial services organisations saw the primary objective of their D&I programme as compliance with legal requirements.
But true diversity can benefit organisations in so many ways. Gender diversity may be taking the headlines at the moment but the greater the diversity of background, experience and thought the more that organisations can benefit. For example, McKinsey’s 2018 report ‘Delivering through Diversity’ noted that those in the top 25% for gender diversity were 21% more likely to achieve profits above the industry average whilst more ethnically diverse boards were 33% more likely to outperform on profits.
Interestingly the perception of the way in which diversity can benefit organisations is shifting as millennials play a greater part in business hierarchies. A 2018 Deloitte study [3] revealed that when asked about the business impact of diversity, millennials are 71 percent more likely to focus on teamwork compared with 28 percent of non-millennials who are more likely to focus on fairness of opportunity. As a result millennials recognise diversity as a critical tool that enables business competitiveness and growth.
[1] https://www.pwc.com/gx/en/services/people-organisation/global-diversity-and-inclusion-survey.html
[2] https://www.mckinsey.com/business-functions/organization/our-insights/delivering-through-diversity
[3] https://www2.deloitte.com/content/dam/Deloitte/us/Documents/about-deloitte/us-the-radical-transformation-of-diversity-and-inclusion-the-millennial-influence.pdf
