Female FTSE 100 shortlists could harm equality

Vince Cable wants the legality of all-women shortlists clarified, but such a policy risks damaging women's prospects.

by Rachel Savage
Last Updated: 01 Feb 2016

Business secretary Vince Cable has backed the use of all-women shortlists for FTSE 100 board posts, a move that could stir up a hornet’s nest of business and legal problems.

Cable has asked the Equalities and Human Rights Commission to draw up guidance for headhunters on whether female-only shortlists are in fact legal, a recommendation in a report by Nomura’s former diversity chief Charlotte Sweeney.

However, single sex shortlists could run into trouble if men left off them claim they have been discriminated against.

‘The difficulty with all-women shortlists is that it requires a selection to be made on the basis of gender, which, on the face of it, directly contravenes fundamental principles of EU law prohibiting sex discrimination,’ Audrey Williams, a partner at law firm Eversheds said.

Other proposals in Sweeney’s review of headhunting include executive search firms putting at least one woman on board shortlists, publishing information about gender balance at various stages of the recruitment process and creating a database of ‘board-ready’ women.

MT is all for upping the number of women at the top of business. Only 20.4% of FTSE 100 board places are filled by women, a big improvement from 12.5% in 2011 but still some way off the government’s target of a quarter by 2015. Meanwhile, a paltry four FTSE 100 CEOs are women and there are a mere two chairwomen.

However, all-female shortlists risk becoming tokenistic as well as potentially running into a thicket of legal issues. Women should be at the top on merit, not because they make up the numbers.

Companies need to mentor female talent better and headhunters should cast the net wider for skilled women – after all, Thomas Cook and EasyJet bosses Harriet Green and Carolyn McCall have both turned around their companies with no previous experience of the industry. More support for childcare costs and flexible hours, so that women can return to work more easily, is also crucial.

And, of course, there is a solid business case for making boards more diverse and not losing out on the best woman or man for a job. Companies may still need prodding, but they do seem to be figuring it out for themselves at the moment.

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Subscribe

Get your essential reading delivered. Subscribe to Management Today