Investors ask chairmen to clarify positions on women in the boardroom
22nd September 2011
Chairmen of UK FTSE 350 companies have been asked to disclose what their goals are for increasing female representation on their boards.
The move by seven leading institutional investors in UK listed companies is designed to send the message to businesses that gender equality is an important issue to asset and investment managers.
In his report Women on Boards, released earlier this year, Lord Davies called on chairmen to make clear what goals they have set in terms of appointing more women to board positions by September.
However, many companies have yet to do this, prompting a raft of major investors to send a joint letter to chairmen of the biggest 350 listed UK companies to ask them to reveal their intentions by the end of the month.
Helena Morrissey, chief executive of Newton Investment Management and one of those signing the letter, said: "In his recommendations, Lord Davies highlighted the critical role investors play in engaging with company boards.
"There is a growing body of evidence that greater diversity at a board level can improve corporate financial performance thereby increasing returns to shareholders. Investors are keen to understand how chairmen are responding to this important issue."
Companies have been asked to state what proportion of board positions they hope to allocate to women by 2013 and 2015.
So far, around a third of FTSE 100 companies have made a public statement clarifying their goals.
"Responsible investors are keen to hear company plans and support progress on benefiting from gender diversity at board level," said Penny Shepherd, chief executive of the sustainable investment and finance association UKSIF.
"In the light of the European Commission's recent Corporate Governance Green Paper, Lord Davies' recommendations also offer a significant opportunity for UK companies to demonstrate the effectiveness of a 'comply or explain' approach compared with the use of gender quotas."
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