Business Leadership: the Catalyst for Accelerating Change
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BUSINESS LEADERSHIP: THE CATALYST FOR ACCELERATING CHANGE With thanks to Follow us on twitter @30percentclub BoardEx for its ongoing support Gender balance on teams achieves better outcomes. OUR OBJECTIVES are to achieve 30% women on FTSE 350 boards and 30% women at senior management level of FTSE 100 companies by end 2020. AS CHAIRS, WE HAVE AN OBLIGATION TO SPEED UP THE PACE OF CHANGE AND INFLUENCE THE BOARD SELECTION PROCESS TO TAKE ADVANTAGE OF THE AVAILABLE TALENT POOL. WE MUST CHAMPION DIVERSITY WITHIN OUR OWN ORGANISATIONS, DEVELOP OUR FEMALE TALENT AND BE DEMANDING WITH SEARCH AGENCIES TO ACHIEVE BETTER FEMALE REPRESENTATION ON BOARDS. Sir Win Bischoff, Chair, Financial Reporting Council DIVERSE BOARDS MAKE BETTER COMPANIES. THEY DRIVE UP PROFITABILITY, ENHANCE INNOVATION AND ENSURE STRONGER CORPORATE REPUTATIONS. SHAREHOLDERS ARE INCREASINGLY EXERTING PRESSURE ON COMPANIES THAT ARE SLOW TO IMPROVE. WE ARE PLEASED “TO SEE THINGS ARE MOVING IN THE RIGHT DIRECTION AND WE DO NOT INTEND TO TAKE OUR FOOT OFF THE ACCELERATOR. Brenda Trenowden CBE Global Co-Chair, 30% Club WHO WE ARE LEADERS LEADING BY EXAMPLE We are a group of Chairs and CEOs taking action to increase gender diversity on UK boards and senior management teams. The 30% Club campaign was set up by Dame Helena Morrissey in 2010 with the aim of achieving a minimum of 30% female representation on FTSE 100 boards. That target was reached in September 2018 and good progress has been made (current percentage is 32.3%). But, there is still much more work to do to achieve better gender balance at the top of businesses. Now under the joint leadership of Brenda Trenowden CBE and Ann Cairns, our energies are concentrated on supporting more women into senior management roles and taking action to reach our 2020 campaign goals. Ann Cairns Brenda Trenowden CBE Global Co-Chair, 30% Club Global Co-Chair, 30% Club FTSE 100 CEO MEMBERS Sir Iván Arriagada, Antofagasta Keith Barr, InterContinental Hotels Group** Dominic Blakemore, Compass Group** Alison Brittain, Whitbread** FTSE 250 CEO MEMBERS Lord Stephen Carter, Informa Group** Mike Coupe, Sainsbury Alan Aubrey, IP Group Andrew Croft, St James’ Place Wealth Mgmt Brian Bickell, Shaftesbury** Mark Cutifani, Anglo American Philip Bowcock, William Hill John Fallon, Pearson** Olivier Brousse, John Laing Group John Flint, HSBC Holdings Stephen Clarke, WH Smith**(stepping down 2019) Liv Garfield, Severn Trent** Luke Ellis, Man Group Chris Grigg, British Land** Rod Flavell, FDM Group** Steve Hare, Sage UK** Tristia Harrison, TalkTalk Group** Stephen Hester, RSA Insurance Group Andrew Horton, Beazley Chris Hill, Hargreaves Lansdown Kevin Hostetler, Rotork António Horta-Osório, Lloyds Banking** Karen Hubbard, Card Factory** Véronique Laury, Kingfisher** (stepping down 2019) Alex Kanellis, PZ Cussons** Dave Lewis,Tesco Johan Lundgren, easyJet** Andrew Mackenzie, BHP Fani Titi, Investec John Martin, Ferguson (stepping down 2019) Jonathan Lewis, Capita Ross McEwan, RBS** Chris Loughlin, Pennon Group Ivan Menezes, Diageo** Dame Louise Makin, BTG** Steve Mogford, United Utilities Group** Convatec* Robert Noel, Landsec** (stepping down 2019) David Nicol, Brewin Dolphin** BT John O'Reilly, Rank Group Unilever ** Preben Prebensen, Close Brothers Nick Read, Vodafone (stepping down 2019) Andrew Rashbass, Euromoney Inst. Investor Andrew Reynolds Smith,Smiths Group David Squires, Senior plc Steve Rowe, Marks & Spencer** Jon Stanton, Weir David Schwimmer, London Stock Exchange Tobias van der Meer, Hastings Group Holdings** Keith Skeoch, Standard Life Aberdeen** Guy Wakeley, Equiniti Group David Sleath, Segro Roger Whiteside, Greggs** James (Jes) Staley, Barclays Bank David Stevens CBE, Admiral Group** David Thomas, Barratt Developments Emma Walmsley, GlaxoSmithKline** Andrew Williams,Halma Aviva** Nigel Wilson, Legal & General Group** Bill Winters, Standard Chartered Bank Charles Woodburn, BAE System ** 30% or more women at ExCo + direct report levels Source: Hampton-Alexander Review, Nov 2018 FTSE 100 CHAIR MEMBERS John Allan, Barratt Developments*/ Tesco* Charles Berry, Centrica FTSE 250 CHAIR MEMBERS Donald Brydon, Sage* Sir Roger Carr, BAE Systems* John Barton, EasyJet* Stuart Chambers, Anglo American Charles Berry, Weir Andrew Cosslett, Kingfisher* Stuart Chambers, Travis Perkins Annette Court, Admiral* Roger Devlin, William Hill Ian Davis, Rolls Royce* Andrew Duff, Elementis* Roger Devlin, Persimmon Sir Charles Dunstone, TalkTalk Andrew Duff, Severn Trent*(stepping down 2019) Ian Durant, Greggs* Mike Evans, Just Eat* Douglas Flint, IP Group Douglas Flint, Standard Life Aberdeen* Gary Hoffman, Hastings Group* Anita Frew, Croda International* Martin Lamb, Rotork* Sir Peter Gershon, National Grid Paul Lester, Essentra* & McCarthy & Stone John Gildersleeve, British Land (stepping down 2019) Simon Miller, Brewin Dolphin* Sir Philip Hampton, GlaxoSmithKline* Sir John Parker, Pennon Group* Andrew Higginson, WM Morrison Sir Ian Powell, Capita Sir John Kingman, Legal & General Group Sir Nigel Rudd, BBA Aviation*/ Meggitt* Ken Mackenzie, BHP* David Tyler, Hammerson* Sir Adrian Montague, Aviva* Deanna Oppenheimer, Hargreaves Lansdown* Sidney Taurel, Pearson* José Viñals, Standard Chartered Bank* Paul Walsh, Compass Group* * 30% or more women on board Source: BoardEx, 05 June 2019 OUR APPROACH THE BUSINESS CASE FOR DIVERSITY IN SENIOR ROLES IS CLEAR The business case is clear – a higher standard of corporate governance, improved financial performance and an enhanced capacity to attract and retain female talent. Diverse teams make better decisions: McKinsey & Company research of 180 publicly traded companies found ROEs were 53% higher for companies ranking in the top quartile of executive board diversity than those in the bottom quartile. Similarly Credit Suisse found that companies where women made up at least 15% of senior managers had more than 50% higher profitability than those where female representation was less than 10%. One woman is not enough: 30% is the proportion when the contributions of a member of a minority group are valued in their own right. Research has shown that a critical mass of three or more women can cause a fundamental change in the boardroom and enhance corporate governance. GETTING TO 30% ON FTSE 350 BOARDS AN ACHIEVABLE GOAL Achieving 30% female directors on FTSE 350 boards is within sight. Women currently comprise 29.3% of FTSE 350 board seats and 168 companies have already reached 30%. There are 4 all-male boards, down from 151 in 2010. Meeting this target will require demand by investors, leadership from board chairs, commitment by nominations committees and action from head hunters. It will also require an ongoing investment from CEOs and leadership teams in developing the pipeline of female directors. Percentage of female directorships on FTSE 350 boards 29.3% 30% 27% 24.5% 25% 21.9% 23% 20% 17.4% 14.7% 15% 11.5% 9.5% 10% 5% 0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 GETTING TO 30% AT FTSE 100 SENIOR MANAGEMENT LEVEL THE PIPELINE GOAL Achieving 30% women at senior management level of FTSE 100 companies is also within sight. Women currently comprise 27% at Executive Committee and direct report levels. FTSE100 35 companies have already reached 30% There are 5 all-male Executive Committees Source: Hampton-Alexander Review | FTSE Women Leaders, November 2018 R INVESTOR TOOLKIT STO INVE FOR ENGAGING UP BOARDS ON DIVERSITY RO tent G of In S ent ION m T bers te TA mem Sta EC f our XP half o ate E n be orpor RE ties o on c SU sibili nies able LO spon ompa suit ISC hip re tee c entify D ards inves s to id l stew with use veral gage oard our o ly en the b rt of ctive cess s pa will a pro A , we ng the stee ients cludi inve nd cl es in of an set a issu nding as ance ard. rsta ent and overn e bo unde spar ners ible g for th sive tran ow t ow pons ates rehen to be nd h sse res ndid omp nies ard a As a are ca th a c ompa he bo The 30% Club believes that THE BOARD’S ROLE IN DIVERSIT Y rs we the rs wi ect c for t age p of vesto e exp bers man dshi ide in es, w mem gender balance on boards not ewar on prov polici d new e st ake To rsity to fin Companies that value diversity of thought, and the for th e m dive used , ts w any’s res d. odes only promotes better leadership en ers omp cedu boar ce C so i t d be efi an nga ed hri i g, v vestm mb c e pro erse ernan t as c a e n ts of e g , t v n inno ative in r me ing th a div Gov sity a and governance, but further of ou hat gard ures orate diver alf of t re s ens Corp nt to d and productive workforce, are committed to fostering beh art ces nder itme e an ts. P the at pro ed u omm mak contributes to better all-round clien des th equir e of c e will an environment that enables that diversity to permeate and inclu res r ultur ies w ging ility rds closu of a c nquir enga oard performance, and ultimately nsib boa s dis nce of e it for b and define the culture. This commitment begins at the spo the well a evide types toolk re nt of es. As see f the stor me pani ct to ils o r Inve increased corporate performance. board level – setting the tone from the top – and extends sess com expe deta in ou as tee also rther ned nves at we el. Fu outli throughout all levels of the organisation. ur i s th rd lev k are of o oard e boa ll see ve b gnitiv the e wi boar th t mbrac s i le n governing rsi belie e co res w A d a e e ts ro i dive ty We rac closu y.