UK boardrooms will not be forced to recruit more women to top jobs, after a government panel ruled out imposing gender quotas, City A.M. can confirm.
A report chaired by former trade minister Lord Davies of Abersoch (pictured) will not recommend a state-imposed quota system to help break up the male dominance of UK companies when it reveals its findings on 24 February, a senior committee member confirmed yesterday.
The report’s authors, tasked by business secretary Vince Cable with boosting the number of women taking directorships, will instead call on companies to do more on a voluntary basis to attract more female candidates, with the threat of quotas as a last resort if numbers fail to improve.
It is expected to criticise headhunters, chairmen and institutional shareholders for failing to tackle the problem sooner, and push for transparency in firms’ board-level recruitment.
But, as one source familiar with the report told City A.M.: “Clearly nobody in the City would prefer to see quotas.”
Many business bodies and academics were dismayed by the idea of government-imposed quotas on boardrooms, with several recommending trial directorships and better opportunities further down the corporate ladder instead during a consultation in October.
The Institute of Directors said even voluntary quotas are “demeaning for many aspiring and existing female directors”, while the CBI put forward a “comply or explain” model similar to that planned in Australia.
Angela Knight, chief executive of the British Bankers’ Association, said yesterday: “There needs to be some positive encouragement for women, but quotas don’t necessarily lead to the right answer.”
There were 135 female directors in FTSE 100 companies during 2010, out of 1,076 directorships, research by Cranfield University showed.
The World Economic Forum in Davos tried to impose a 20 per cent quota for female delegates, withholding extra places from companies that sent all-male delegations to the conference in January, but fell short with around 16 per cent.
The European Commission is also considering a mandatory target for women on boards, following the introduction of schemes in Norway, France and Spain. Norway is close to its target of 40 per cent after five years under a mandatory quota.