C-Level, CEO, Chief Executive Officer, Executive, Executive Search, FTSE-100, Gary Chaplin, Gary Chaplin Recruitment, HeadHunter, headhunting, Marissa Mayer, recruitment, Sean Connery, Sylvia Hewlett, Women in Business, Women on Boards
So we’re here…. We’ve hit Lord Davies’ target date of 2015 and the magical target of 25% female representation on FTSE-100 (or Top-150 as it was initially) boards is within fingertip reach. [see here for North-West Female Candidates for your Board]
Even more importantly, there are now NO all male boards in the FTSE-100, and just 23 in the FTSE250. This compares to 21 all-male boards across the FTSE-100 at the time of the initial Davies report (131 in the FTSE-250).
Great news. Well done Lord Davies!
Women now sit in 263 of the 1,119 FTSE-100 board positions, and a pleasing 31% of all board appointments in those firms from the last year have been female. Even dour old-sage, former/ousted business secretary Vince Cable has said that top British companies are “moving in the right direction to encourage greater gender diversity on boards – but the hard work is far from over.”
He added: “We will only achieve the target if there is a renewed, concentrated effort by chairs and CEOs to continue to change the makeup of management at their top tables. More needs to be done to improve the number of women in executive positions. These will be the CEOs of tomorrow and businesses still aren’t tapping into the vast talent pool available.”
(There is a ‘but’ coming here….)
This success is not the success that Lord Davies is claiming. Aside from the volatility in percentage female appointments (the number of female appointments has fallen every year since 2013), there is a huge elephant in the room…. The figures are being fudged, in the same way as in every quota-led country.
In 2009, 18.1% of FTSE-100 executive committee members were female. In April 2013 that was 15%. Accordingly to Lord Davies’ latest Annual Report on the subject, that figure is now just 8.6% – that’s significantly less than half of the 2009 level.
How is that possible when total numbers have near doubled from 12.1% to 23.5%? Easy…..businesses have done exactly what I predicted they would do three years ago….. fudge the figures as if it was a statutory quota – they have merely employed females into Non-Exec Roles, employed ‘Golden-Skirts’….or worse still, ‘created’ NED roles merely to tick a box.
Even Lord Davies has thrown the towel in admitting in January 2014 that the only way to get to his magic, arbitrary set 25% was through non-execs. Classic politico objective of ‘hit the target regardless of the real impact’?
Last year, over 50% of the people I put into new roles were female. Not a single role was ‘created’ for a women. Not a single role was adapted for a woman. Only one was a Non-Exec (and it was a Non-Exec Chairman role). Not a single one of those women had specifically been coached to get a role, nor were they the ‘token inclusions’ on a forced shortlist. The women that got those roles for one simple reason. They were the best Man for the job.
I said three years ago….. that by far the biggest issue in getting increased female representation was supply, not demand… I still maintain that, except it has now arguably got worse, not better. It’s not got worse because women are less suitable, no, it has got worse because less women want the role.
Even the feeding ground of the FTSE-250 has seen a similar shift in great headlines but shocking statistics. The number of female executive directors is down to a staggering 2.1% (with total female Directors numbering just over 17%) and the rate of appointments has slowed even greater. All this despite immense political posturing, media attention and point scoring highlighting the ratio of women in everything from the competing sides of the House of Commons to front line armed forces rather than focusing on, or even discovering the real reasons for the disparity.
Those that could make a difference, are just pointing out the obvious, rather than really finding a solution, at best, threatening a stick rather than helping find a carrot.
Witness a classic political non-quote from then “Minister for Women and Equalities” Maria Miller:
…..“It makes clear economic sense for women to be able to rise to the top. Good progress is being made in Britain through a cultural shift that promotes on merit, not through the mandatory quotas advocated by others.”
……“The workplace was designed by men for men. Women don’t need special treatment – they just need a modernised workplace that gives them a level playing field. Supporting women to fulfil their full potential should be a core business issue; not just so we can reach our target of 25% of female appointments to FTSE100 boards by next year, but for the long-term sustainability of our economy.”
[What does a ‘modernised workplace’ look like? And compared to what?]
The business case for Women on Boards is obvious and has never been disputed. So well done Maria Miller for highlighting the obvious, missing the point and doing nothing to improve.
Female Exposure. Not what you think.
I have exposure to more senior executives, and more female senior executives than most people. No female has ever complained about un-modernised workplaces or un-level playing fields being a hindrance to female career progression and ascension to the board. Only one female has ever commented on even a remotely anti-female attitude to board recruitment – and that was solely the personal attitude of a Manchester PLC’s CEO, and thus she didn’t spit her dummy out, she just left and joined a different business.
Think of the Children
It is at this point that unimaginative Women on Boards campaigners throw the ‘Child-Care’ grenade in. Cost of childcare is a prohibiter to a lot of things. Certainly to the lone or second parent going to work it is expensive, but at c£50 for a 10 hour day, subsidized by 15 hours per week (soon rising to 30 hours per week….thanks George Osborne in Wednesday’s budget) free PLUS childcare vouchers (allowing the employed couple to cover £500 per month of the remaining costs from Gross salaries), the cost of childcare isn’t really that great for a high-earning professional couple.
Furthermore, the average age a female graduate has her first child is 35yrs old. For qualified female professionals that becomes 37. A future FTSE-100 main board-director will be very close to at least operational board level, or FTSE-250 board level by the time they are 37. They will certainly be earning well into £6-figures. The cost of even full-time childcare is a minimal financial consideration for such a demograph.
The argument then develops into the ‘Biological Grenade’ – the prejudice against women that take their 6/9 month maternity leave out of the work place. This is an issue, especially within certain environments – however, again using the reasons in the above paragraph, a fully-career-focused female, by the time she gets to 37, will [from my direct and personal experience] be suitably valued and have such career momentum that [they will ensure] such a break will have minimal impact on a genuine, future FTSE-100 Board Director’s ascension.
Such research is backed up by Sylvia Ann Hewlett (Leading economist and expert on gender and workplace issues). Her research primarily states that a woman who took more than 2 years off lost 18% of her earning power and lost momentum with her career…however up to 12 months away had no effect on earnings, or career prospects whatsoever.
So….If childcare and childbirth are of minimal impact to the top-flight execs that Lord Davies is targeting. What is the issue??
The primary part of the issue, again from my direct experience, is attitude, and personal interest. Throughout scholastic environments, females outperform males. Ditto in Further and Higher Education. Even in professional qualifications, pass-rates are typically higher for females than for males…..however the numbers entering professional qualifications starts biasing towards males.
Even at this stage, aspirations begin to take effect. Everyone differs, but the differences between genders becomes very noticeable.
Last year, the Telegraph conducted a survey amongst new graduates. Over 40% of male respondents aspired to take home more than £100,000 per year, only 16% of females did.
At the opposite end of the scale, 19% of females would be happy earning £30,000 with no aspirations to earn more whereas only 10% of men would be.
Other findings from the same survey? M Vs F?
Running your own business: 22% Vs 16%.
Becoming a CEO? 26% Vs 3%.
Swapping a 4-day week for a C-Level career? 16% Vs 38%.
This difference in ambition sets the two genders off on different paths at the age of 21. An overly bullish ‘do what it takes’ attitude is far more prevalent in men, the more humanistic balance between life and work being more prevalent within women… both having an impact higher up the corporate ladder – but which demeanour is correct?
There are a huge variety of reasons why females are less likely to aspire to climb to the highest ranks. Motherhood is unquestionably one of them. I have seen even the most career-focused professionals (male & female) suddenly have their priorities dramatically shift once a baby arrives – and quite rightly/understandably so. Every person is different….not everyone can be a Marissa Mayer, appointed CEO of Yahoo! at 6 months pregnant, took 45 minutes maternity leave, set to take home over $100m over her first five years employment.
Attitude and desire still fits in hugely. Last year I interviewed a female FTSE-100 CXO with a view to considering her for a FTSE-100 CEO position. She was perfect for the job. Natural-risk-aversion, complementary sector, perfect skills-match and great chemistry fit with the rest of the board. However she immediately ruled herself out. Why? She just didn’t need the hassle. She had no need to turn her £7-figure annual remuneration into a larger £7-figure remuneration and certainly didn’t need the increased stress, hassle and intrusion into her life. Her quote? “I don’t need the Ego-trip of becoming a CEO”
And therein lies one of the current biggest issues behind what I believe is the lack of supply to get women to C-Level. Women (typically) don’t need the Ego-Trip, at least as much as men. Career focus, professional capability and ability to perform are right up there…..but the need to balance life is just that little bit greater. As the lady mentioned above stated – her then current CEO had media camped outside the gates of his house for more than a month, she didn’t need the ego-trip or increased remuneration as much as she needed the relative anonymity for her, and her family.
Everyone has a different view of what Work Life Balance means. For some, it’s doing a 9-5 job that they can fully switch off from the second they cross the threshold of their workplace. For others it is 30/35/40 days holiday. For some, it’s having (most) weekends with some time off so they can see their families.
One thing that the C-Level execs of Lord Davies’ targeted FTSE-100 business do have in common is that they are unlikely to be in the running for ‘parent of the year’. Similarly true of leading entrepreneurs. Most have to sacrifice just about everything to attain top billing – “Entrepreneurship is living a few years of your life living like most people won’t, so you can spend the rest of your life living like most people can’t.”
I saw Lord Alan Sugar interviewed a few years ago. He was asked how he juggled Work and Family. His response. “I’ve been a shit father and a shit husband. I couldn’t have been good in business AND a good father/husband. I made a choice”. C-Level execs of both genders have to sacrifice just about everything, especially family life. PC or not, fewer women are prepared to do so than men.
Is that their weakness though? Or their strength?
As the role of a C-Level exec becomes more stressful and far more public (open the business pages of any broadsheet and there will be some story about some exec pay/exec performance/shareholder revolt argument…), so people of both genders are turning their back on large Corporates, especially those who crave a ‘life’ and take responsibilities as a parent to heart.
This move explains the increased prevalence of former corporate (future) execs becoming entrepreneurs, never more so than with females. The number of female entrepreneurs, setting up businesses has rocketed in the last 5 years.
The Babson report highlighted that, in 1999, 13% of Start-Ups were started by females. In 2012 that was 45%…and still increasing. The average age of the female entrepreneur? 38 yrs old….. just one year older than the professional females average age of new motherhood. Coincidence?
So perhaps motherhood does have an impact on some women’s corporate career prospects, however much of a fully personal choice it is…..but don’t assume the output is all floral dresses and home-bake parties.
…..and what is more valuable to society? Female’s making up 25% of running large businesses? Or females setting up their own business and really adding to society. Or is the mix of the two really quite equitable and beneficial?
The commercial benefit of having Women on Boards is well-known and universally accepted. What we need however is real action. No arbitrary-set quotas or targets on female inclusion. No blaming all around for why more businesses don’t have more women in influential positions. Certainly no comically false International HeadHunters promising the ‘token women’ on a shortlist.
The corporate landscape needs to evolve, but like it or not, running a £bn+ business is never going to be conducive to making it home for bath-time and the bedtime story, that is why the average FTSE-100 Executive Director earned £1,121,700 last year, and the same again in vested LTIPs. It is also why divorce rates are almost double the national average for FTSE-100 exec directors. If it was easy, everyone would be there.
If we want more women on these boards…..we need more women that really want to be on these boards and rightly or wrongly, want it more than anything else from very early in their career.
What the answer is not is to propagate every large corporate with ‘token female’ Non-Exec Directors. It certainly is not to implement a Norwegian style quota (unless we want to see Norwegian style ‘Golden Skirts’ like Mimi Berdal who was Non-Exec for 90 different businesses – all of which got to tick a box, but only realistically have a ‘women on their board’ two days per year).
The answer is to improve the supply…and improve who ‘corporates’ choose to find that supply. If I can fill over 50% of executive roles with women, why do others struggle to forcibly shortlist 1 in 10?
Submit your answers written in lipstick on a compact mirror….?
PostScript – Practical solutions
Don’t believe you can find outstanding female candidates to populate your board? Think again. See here: Female Board for the Northern Powerhouse