Thatcher & Women on Boards
Last week saw the passing of one of the most influential figures in the Women in Business argument, controversial Women’s Libber, Margaret Thatcher. It also saw the stark news that Lord Davies’ Women on Boards agenda was faltering.
Thatcher was a self-declared non-feminist, famously stating “The feminists hate me, don’t they? And I don’t blame them. For I hate feminism. It is poison”. And yet, ask one of the still comparatively few women on FTSE350 or Top150 boards about her, and most will attest that she had a huge influence in their progression up the corporate ranks. She showed a generation of Women that anything was possible.
“If you want something said, ask a man. If you want something done, ask a woman”
There are plenty of detractors for Lady Baroness Thatcher, never that I can remember has one person caused such polar opinion…..but I’m not going to get into defence, nor attack of her.
However, lets put just one thing in context. Aside from the ‘poor man of Europe’, union led, blackout-rich state of the UK before her election victory in 1979, our country was still a very anti-women environment. The Sex Discrimination Act and Equal Pay Bill only came in the same year as she became Conservative Party Leader, and the London Stock Exchange only allowed women onto its floor 22 months earlier. Even more incredible, as recently as 1974, women were not allowed to rent white-goods from some providers (and most households couldn’t afford to own such things…).
Further context….it took 18 years after Thatcher defied the UK’s most male-led environment to lead the country until a FTSE-100 had it’s first female leader – Dame Marjorie Scardino at Pearson. Whichever way you look at her, she was a game changer in getting women to lead, and aspire to lead.
38 years after The Sex Discrimination Act came into force, female board representation is now common place. Still not hugely common in the top job where we STILL never had more than 5 female FTSE-100 CEOs, but all but 7 of the FTSE-100 now have a women on their board, and over 17% of Top-150 directors are female, not far off double that of just 5 years ago, and up more than 10% compared to just a year ago. Lord Davies challenge to business to get to 25% female representation by 2015 looks attainable.
Or does it?
We’ve learnt this week that female board appointments to FTSE-100 boards have actually dropped in the last 6 months. And not just a small amount, they have almost halved from 44% to just 25% over the past 6 months.
This at the same time as several high profile females have also left their positions as FTSE-100 Directors, corporate trailblazer Dame Marjorie and AngloAmerican’s Cynthia Carroll being two high profile examples; both replaced by men.
Female FTSE-100 CEOs are now dangerously close to an all time low with just two female leaders current holding office
…and it gets worse.
Pro-Quota supporters highlight the ‘success’ of countries with quotas and/or penalties for businesses failing to reach set levels of female directors. Norway is the overused example. They implemented a legal stipulation for 40% of a company’s directors to be female, and it’s worked…..Except it hasn’t really.
What it has done is see Norwegian businesses fudge the figures to hit an arbitrary set limit. Many Norwegian businesses have used the promotion of (female) senior managers and department heads to notional board status to increase their ratios. Even more common is the explosion of female Non-Exec Directors to swell the ratios of female Directors, especially through the use of ‘Golden Skirts’.
Golden Skirts is the nomenclature given to serial Non-Execs, employed in an almost ‘rent-a-crowd’ fashion to increase ratios. Want to see how ridiculous it has got? Mimi Berdal was Norway’s most famous Golden Skirts. At one point she was a Director of 90 businesses. That’s right 90. All 90 could boast an extra tick of female board representation, but with only 365 days in the year, each business would get less than 1 day per quarter from her. What possible influence can 1 day per quarter really bring? But it satisfied the politicians and box-tickers.
Accordingly to McKinsey’s ‘Women Matter’ survey, almost 80% of female directors in Norway are Non-Exec, with the average number of posts being held by each female director being 8. Easily questionable how much impact those women on those boards can really have.
And even without quotas, it is heading the same way in this country. Although the number of overall women on FTSE-100 boards has increased from 12.2% to 17.3% between 2009 and 2013, the number of female executive committee members has decreased from 18.1% in 2009 to just 15% now. Even the overall number has dropped by 0.1% in the last 3 months.
Both lessons are further reason why quotas will not work, businesses will just get round the issue to tick boxes. Lest we forget, the news has been dogged with businesses ‘getting round’ tax issues. Gender issues will be even easier to manage.
So what will work?
First and foremost, understanding the real issue. Too many of the established Women in Business supporters seemingly spend much of their time selling the benefits of a gender balanced board. This is like selling the benefit of insurance price comparison to an anthropomorphic Russian meerkat; We get it. It is over 6 years since I had a client not actively want to attract women onto their board, and he was a well-known, particularly chauvinistic PLC CEO. Financial/Cultural/Decisive/Stock-Price benefits gender balance brings are well documented and universally agreed upon.
As discussed in Women in Boardrooms: Supply not Quotas, the issue is supply of willing and suitably qualified execs (not just ‘capable’). Supporters will repeat ad nauseum that there are more than sufficient highly qualified women. They will blame outdated Chairmen for blocking the move, non-gender-balanced nominations committees creating non-gender-balanced board and even point the finger at sexist practices by HeadHunters. All of which I am sure are not totally absent, but they are certainly not a realistic factor. It’s the supply.
Business luminaries such as mightily impressive Baroness Martha Lane Fox and the globally renowned Helena Morrissey will point to the recently compiled European Business Schools/Women on Board list of 6000 Board Ready women, a searchable list of, as the name suggests, 6000 Board Ready Women currently residing in Europe. A great tool and a fantastic start, but there are a several issues with that.
- Over 25% of the 6000 are pure academics, not business ready professionals
- Almost 50% of those in business are currently within businesses (or business units) turning over less than €100m
- It doesn’t factor in how many of the 6000 actually want to be a large company board member.
Two other interesting facts:
The numbers of Board Ready Directors needed to populate even just large businesses are huge. Mirella Visser of Gender Balanced Boards estimates the number of exec and non-exec directors needed to make a long term difference in Europe (EU27) to be 25-30,000. Her home country alone (The Netherlands) estimates it needs 3-3,500 female Directors, ready to ascend to the boards in the next 3 years.
Secondly, a flash report by McKinsey, using the same criteria as the European Business Schools/Women on Board used, estimated that there were over 100,000 ‘Board Ready Males’ – giving a ratio of 6:100, 6%. Even Italy betters 6% women on boards.
Supply is an issue…..but it can be addressed.
First we need to stop messing about with nonsense reasons for the lack of female ascension to the board.
Lord Davies, and others, cite the cost of childcare for aspiring female executives as a major issue.
I don’t doubt that is a hindrance to many women in the workplace, but not women with their sights on the top table. Career driven execs of both genders come out of the blocks at an age well before family-planning becomes an issue.
Research by City University London shows that the average age for female graduates to have their first child is 35, for professionally qualified women that becomes 37. By such an age, a potential top-150 Board Director has their career sufficiently underway with a board appointment more than likely already behind them, for family considerations to not enforce involuntary disruption, especially for financial/child-care cost reasons.
Lord Davies, and others, then add the ‘biological issue’ to the argument, that women returning to work after maternity leave are often disadvantaged because of it. Again, majority of potential top company Board Directors will, by 35/37, have their career at such a stage of advancement that such leave is highly unlikely to have a significant effect.
Of all the female FTSE-350 C-level execs I have interviewed, not a single one has cited any such hindrance to their career. Many may not be totally proud of the fact that they have put their career first, but none has ever felt that cost or existence family was a hindrance. Witness Marissa Mayer if you want an extreme example.
That is not to say that many female (and male) professionals won’t choose to give up a career, or choose to down-shift. And this leads into what I see as being the real issue. Choice.
Sheryl Sandberg, COO of Facebook (and almost as detested in feminist circles as Marissa Mayer and Lady Thatcher) states “it is often women who stop themselves from reaching the heights of professional success in ways both big and small.”
One of the biggest derailing factors that prevents women getting to the top table, let alone the top job is nothing to do with their suitability, their capability or the benefit they can bring…..it is that they simply don’t want it.
Many women simply don’t need the ego trip of being CEO/CXO compared to men.
Even more common in this age of mass executive vilification, often deserved but even more often simply due to media spin/politics of envy/anti-success rhetoric [we’re getting back to Thatcher….], many women simply don’t want the stress and hassle that running a major corporation brings.
I’ve looked back over my notes from the last 15 FTSE-350 female execs that I have met; 6 FTSE-100, 9 FTSE-250. Only three of the 15 were CEOs, and all three had a long-term desire to move away from large corporates, 2 into pure NED roles, one into smaller more lithe businesses.
Of the non-CEOs, every single one had no desire to become CEO. They didn’t need the hassle, didn’t need the boost to self esteem and saw the positives outweighed by the negatives, indeed only two of them saw their next move as remaining in a FTSE-350 board role, the pull to Private-Equity or even more anonymous private ownership being the bigger pull.
Across the gender gap, of the equivalent males I have interviewed, only two had no desire to make CEO, both currently CFOs and both for the reason that they enjoyed the financial remit too much.
Wind that back to earlier in people’s careers, according to a Telegraph survey last year, at the point of leaving university twice as many males aspire to become a CEO than females. For those completing an MBA, that ratio increase to 4-to-1.
Signs of REAL change.
It is improving though. Female interest in senior roles is improving. The average number of females long-listed has doubled in the last 2 years, and the number shortlisted has increased almost as much. If we take the real-life example of my placements this year:
- MD, £50m B2B
- CFO, £150m B2C
- Commercial Director, £bn B2B/B2C
- CFO, £30m B2B
- CMO, £125m B2C
- Brand Director, £75m B2C
- HRD, £100m B2C
- HR Manager, £75m B2B
- EA, £100m B2C
6 of the above 9 have been female. All shortlists had at least one female, with no all male shortlists (but 4 all female shortlists). Granted, the bottom three roles are very female dominated in function, but even 50% female representation makes it better than any other year in my 20-year career.
As a further indicator, I have two roles at final stages this week, both have a female as their strongest contender, one is an all-female final stage. Other senior roles being shortlisted are likewise. Trading Director (3/5 female); CFO (2/4) only the CEO role has a significantly lower female representation (1/5), which is co-incidentally the highest salary.
…..but Lord Davies target is the Top-150 comprising of the FTSE-100 and the largest 50 non-listed organisations, salaries of which start at £300/350k and go well into £7-figures, and that is where the supply issues lay. Tellingly, the three highest salaries and arguably three biggest roles of those above are the ones secured by men.
Even more tellingly, only one of the females appointed has her sights set on CEO, but all three males do. Also telling is that I have also had 3 roles turned down by women, all offering career advancement, all deciding to stick with their current roles, broadly due to risk aversion. No male has turned an offer down.
“Contrary to the opinions of the members opposite, Pennies don’t fall from heaven, they have to be earned here on earth.” Margaret Thatcher, 1979.
We need to increase female desire to climb the corporate ranks and ascend to the top tables of the top businesses.
There is absolutely no question that a large part of that is the gradual shift of culture, environment and structure of executive management teams within large businesses, AND the support/sponsoring/mentoring of female middle & senior managers within those businesses to encourage them to [want to] continue their career progression. Both aspects are well underway, but still need greater focus.
But it is also the aspirations of women that need to be targeted and addressed…..and not just professionals, not even just existing managers. Younger women, including those still at school let alone those in Higher Education, need inspiration to create their aspiration to enter and lead the business world. To create a sustainable pipeline of real female talent. One of the best inspirations is a number of female role models. We need more modern day Thatchers.
But we need female role models that will directly encourage females. Thatcher, whilst a great role model for women, did very little herself in terms of specifically bringing women to the top, both in terms of her policies and her choice of cabinet.
However, she did bring hunger, resolve ….and rose to the ranks on her own terms, and did so in a time with far greater barriers to entry than exist today. Too many women simply try and become men in order to compete with men. Thatcher famously used her femininity to her own benefit, and ultimately to the benefit of our country.
This is not an overnight solution, it will take a generation to really change the landscape of women in business, the attitude of women in business and the attitude of business towards women. It also needs a culture where women do not fight amongst themselves. As soon as a strong women rises to the top of her corporate game, she is turned on by one side of the female-support/feminist movement – witness the vitriol displayed to Marissa Mayer and Sheryl Sandberg, almost exclusively by other women.
A shift in attitudes across the genders will bring about genuinely balances boards. But a key role in that change is women themselves: Their desire to lead; willingness to do what it takes and resolve to get there. They need to be a Lady not for turning.
“I came to office with one deliberate intent: to change Britain from a dependent to a self-reliant society — from a give-it-to-me, to a do-it-yourself nation. A get-up-and-go, instead of a sit-back-and-wait-for-it Britain”. Margaret Thatcher, 1984.