Report reveals no progress on gender parity among FTSE 350 in last three years

The number of women working in senior positions in accountancy firms is still only 16%, the same as it was three years ago.

The Women Count 2018 report has identified a lack of progress on gender diversity among FTSE 350 companies in the last three years.

By some measures, the UK even seems to have gone backwards when it comes to balancing genders in senior roles.

Women Count, an annual report by The Pipeline, tracks and analyses the number of women working on executive committees in FTSE 350 companies.

The percentage of women on executive committees remains at only 16%, the same as it was when the study was conducted three years ago.

Almost all, 95%, of P&L roles on the executive committee are held by men and this percentage has decreased since last year. Women tend to occupy more ‘functional’ roles such as HR, marketing, legal, or compliance.

Only 8% of executives on main boards are women – a percentage that has remained the same from 2017 to 2018.

Expectations are so far from the truth. British businesses expect professional services firms to be more gender diverse. As a bare minimum, if one business is buying services from another, they will expect to see women on the presentation team.

This has been found to be particularly true among larger companies providing, for example, legal services, accountancy support, and consultancy.

Customers have taken it upon themselves to check what potential suppliers are doing for gender parity, asking them whether the women presenting will actually be delivering the work.

This may be especially difficult for the Big Four firms, PwC, Deloitte, EY, and KPMG, whose partners are at least 75% male.

In March The Financial Times reported how business leaders had taken a dim view of the initial decision by the Big Four not to include partner pay in their gender pay gap reporting.

Auditors will not be able to get away with this as clients continue to question them more and more, and actually this progression will mean the firms with more senior women will win more business and do better.

There is a £13bn gender dividend to be gained for UK plc if all FTSE 350 companies performed at the same level as those companies that have women on their executive committees.

FTSE 350 companies that don’t have women on their executive committees only tend to achieve a 8.9% profit margin on average but when there are at least 25% of women on executive committees this average rises by 5% to 13.9%.

Lorna Fitzsimons, co-founder of The Pipeline said: “This is an issue of competitive advantage and profitability which is echoed through FTSE 350. Companies who have at least 25% of women on their Executive Committees have the potential to benefit from 5% greater profit than companies that have no women. This adds up to a £13bn gender dividend for all of Corporate UK performing at the same level on gender diversity.

“We’ve already seen that hundreds of US corporates signed the call to action on diversity set out by the General Counsel of Sara Lee. This confirmed their commitment to only procure services from diverse law firms. With UK companies starting to pay closer attention to the diversity of law firms, it’s just a matter of time before considering diversity before buying services becomes the norm on this side of the pond.

“Since our poll confirmed that 59% of young people believe all male or male dominated workplaces should be a thing of the past, law firms that increase the number of women in senior roles, will stay ahead of the pack.”

Nicky Morgan MP, chair of the Treasury Select Committee, said: “Women Count 2018 gives us the proof that having more women on executive committees boosts profitability. It unpacks in forensic detail the status of women in FTSE 350 firms, the number of women on executive committees, and the correlation between female representation and economic performance.

“This lack of progress calls into serious question the possibility of achieving the UK’s target of 33% by 2020 which I set in response to the Davies Report, as Minister for Women and Equalities in 2015. Businesses that don’t understand the need to appoint more senior executive women are failing to meet their full potential. I ask them to read this report and wake up to reality, in their own interests and the country’s interests.”