FTSE 100 companies hitting Parker Review diversity targets

FTSE 100 companies hitting Parker Review diversity targets

The Parker Review, which considers the ethnic and cultural diversity of UK boards, has published the results of its latest survey of FTSE 100 and FSTE 250 companies. The findings confirm that nearly all FTSE 100 companies have met the Parker Review's 'One before 2021' target which was established to improve the ethnic diversity of their boards.

In 2017, the Parker Review and the Parker Review Steering Committee made a series of recommendations and set out goals to improve diversity within FTSE 100 companies. The goals for these companies included the 'One before 2021' target of each having at least one ethnic minority board member by the end of 2021. The Parker Review has in place a similar target of 'One by 2024' for FTSE 250 companies.

The Parker Review 2022 progress report sets outs the findings of its latest voluntary census.

89 FTSE 100 companies have a director from an ethnic minority background

The results show that 89 FTSE 100 companies have ethnic minority representation on their boards. A further three companies are actively engaged in recruitment and another five announced that an ethnic minority board member will be appointed by March 2022. Only three companies signalled that they will not comply with this target: one is to de-list, another is the UK subsidiary of a US Group and the last is a Russian steel and mining company.

These findings reflect a marked increase in ethnic minority representation across listed company boardrooms, particularly when compare with the 2016 figures which confirmed only 47% of FTSE 100 companies had an ethnic minority director. The results also revealed an even gender split across these boardrooms, with 49% of the positions held by women.

Majority are non-executive directors

The overwhelming majority of these appointments are non-executive directors. Only 6 FSTE 100 and 13 FTSE 250 companies have an ethnic minority CEO. There are even fewer chairs from ethnic minority backgrounds, with only 3 amongst the FTSE 100. The Parker Review is nonetheless satisfied with its findings and expects the appointments which have been made to date to lead to an expansion in the number of ethnic minority directors assuming the most influential roles within these companies. It is anticipated that the growth will mirror the changes seen with female representation on boards over recent years.

Future expectations

The Parker Review Report stresses that it is critical we see no future reduction in the representation on boards of minority ethnic directors of other nationalities, as they provide a key perspective and insight into the foreign markets that many British companies operate in. Moreover, the progress report encourages companies to re-evaluate their internal inclusion and diversity initiatives. Lastly, the Parker Review recommends that companies reconsider the background of the ethnic minority directors being appointed. While there is no authoritative data on this point, it notes that those from Asian communities seem to hold more senior positions that those from Black communities. This is something that the Parker Review might assess in the future, but individual companies are advised to consider the potential point as well.

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