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Key Facts

No progress in getting more women on executive committees

Women promote women and make change happen

Correlation continues between profitability and more women in senior roles

Company boards – women executives do not break through

Women still hugely underrepresented in other senior leadership positions

Gender pay gaps are worse without women executives and CEOs

Young people demand greater gender diversity at work

Industry Insight: Overview

It is alarming that Women Count found representation of women on FTSE 350 Executive Committees remains at only 16%, with no real progress since 2016 but is that the case in individual industry sectors?

Women on executive committees

It is discouraging to find the results are low whichever industry sector we analysed.

The only sector that is slightly higher than the FTSE 350 is Wholesale and Retail Trade continuing its positions as a higher performer in 2017. This reflects the high percentage of women they employ compared to other sectors. At the other end of the scale, manufacturing, mining and construction continue to be in the bottom quartile, echoing the dominance of male employees and leaders in these sectors.

Women in P&L roles on executive committees

The picture is even more dispiriting in terms of women in P&L roles on FTSE 350 executives, especially as these are springboard jobs for advancement to becoming a CEO. Although the stand-out statistic is Mining with 1% of women in P&L roles on their Executive Committees, all other sectors in the FTSE 350 have much work to do.

Women executive directors on company boards

There is a great deal focus on the representation of women as non-executive directors. We believe increasing the number of women as executive directors on boards is critical to change the make up of Corporate UK, as executive directors are responsible for running the organisation full-time on a day-to-day basis. A non-executive director’s role on boards is to represent shareholders’ interests and, more broadly, wider stakeholders, and be responsible for oversight and governance.

Accommodation and Food Service Activities outperforms the FTSE average but this is misleading. There are only five women who are executive directors on the boards of these companies, but this is much higher than other sectors so it ranks as a high performer.

Gender Pay

When we looked at the most recent gender pay gap data, we found a clear correlation between the companies with the lowers numbers of women in senior positions and the highest pay gaps. We also found that having any women on the Executive Committee lowers the gender pay gap with a female CEO having the biggest influence on dropping the pay gap. This reinforces the importance of more companies having a women as CEO and women in P&L roles to create a strong pipeline of women executives as part of a company’s succession plan for future CEOs.

Industry Insight: Overview

Women on executive committees

Women in P&L roles on executive committees

Women executive directors on company boards

Gender Pay

Industry Insight - Sector Detail

Construction

There has been progress in this sector, as they have seen a big increase in the percentage of FTSE350 companies with 25% or more female representation on executive committees (2017 had 6% and 2018 had 36%), however the same number of companies that have 25% or more representation of women, have no women at all.

On average, this sector has 13% representation of women on their executive committee and construction companies will struggle to improve the ratios both on executive committees and Boards whilst they have one of the lowest representations of women in P&L roles (4%).

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Mining & Quarrying

Despite one of the biggest companies in this sector, BHP Billiton, publicising bold targets on gender, others have not followed suit. This sector has only 10% representation of women on their Executive Committees and shockingly, a mere 1% representation of women in P&L roles. Not only does Mining have a poor record on engaging women in senior roles, they also have the highest gender pay gap.

Needless to say, there is much work to do here. As a result, Mining has the lowest ratios on all the measures we assessed which are:

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Banks

Banks continue to have much to do if they really want to improve their gender pay gap, increase women in senior roles and better reflect their customer base. With 25% representation of women on their executive committees, this means that men make up 75% of operating committees. Even worse on the main Board, there is 83% representation of men across Executive Director roles.

Increasing the number of women in senior roles generally is part of the solution, the other is to increase the number of women in P&L roles which is the route to CEO. With Jayne-Anne Gadhia stepping down as CEO from Virgin Money in the lead up to their merger with CYBG, this sector needs to appoint more women to run their business otherwise change will not happen quickly.

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Insurance

The Chartered Institute for Insurance is committed to correcting this sector’s past of promoting jobs best suited for ‘boys’ (ie technical and managerial roles) and for ‘girls’ (ie administrative roles)*. However, with low representation in all senior insurance roles, particularly in P&L roles, it looks like this sub sector of Financial and Insurance services, has yet to shake off its historical roots as a man’s career.

*Reference: CII careers pamphlet 1963

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Pharma

Pharma (part of Professional, Scientific & Technical Activities) has a higher representation of women on their Executive Committees than the FTSE 350 average and their position has increased slightly since last year. Perhaps we are already seeing the positive impact of GlaxoSmithKline having a female CEO. Even so, this sector’s representation of women in P&L roles has to increase if these green shots are going to turn into a positive, sustainable trend.

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Retail

Similar to last year, Retail companies (part of Wholesale & Retail Trade) were in the top quartile on the three key measures we analysed. However, the percentage of women in P&L roles on executive committees is worrying. In a sector that is predominantly P&L focused, without a robust pipeline of women with P&L experience, retail is unlikely to see strong growth and may lose their top spot.

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Utilities

Companies which provide utilities to the British public’s homes may be vying for more market share and the top spot in customer service awards but they are lacklustre in terms of gender diversity. They certainly aren’t representative of their customer base with statistics which are close to the FTSE 350 average for the three measures we’ve focused on.

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Real Estate Activities

Real estate is traditionally a male-dominated business but it seems that advancing women is increasingly top-of-mind. Industry leaders are starting to recognise that good investment decisions require diversity of thought. Socially conscious investors are also demanding more diversity. Whilst some progress has been made in getting women into P&L roles at 7% there still needs to be more of an industry and cultural shift if they are to achieve executive status.

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Manufacturing & Engineering

These companies (made up of Manufacturing and part of Professional, Scientific and Technical activities) are below average on every measure we assessed. Industry-wide initiatives which are trying to change the image women and girls have of this sector, such as the National Women in Engineering Day, are a positive step. However, until we see more gender diversity in senior jobs, women won’t have sufficient role models to inspire them. With such a low ratio of women in P&L roles, this should be a key area for this sector to focus on.

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Our Recommendations

ONLY THE CEO CAN MAKE IT HAPPEN

Companies take their lead from the boss and if organisations are to deliver true gender diversity, it has to start at the top. Well meaning words are fine, but it is actions and behaviours that count. CEOs must step up and treat gender diversity in the same way as other key business issues and commit to targets, create deadlines, empower people to deliver, and hold the organisation and individuals to account for their performance.

FOCUS ON THE EXECUTIVE COMMITTEE AND PLAN THE FUTURE

Rigorous and actioned succession planning is vital for achieving gender diversity on executive committees. Know which woman is right for which job and be transparent about it. Also, be clear that getting more women on the executive committee is the biggest priority. Setting a transparent target for this, and by when, sends a powerful message to women everywhere that businesses are prepared to take tough action to move the dial on this crucial issue.

JUST DO IT

Too many organisations seek the perfect women candidate before making senior appointments. Yet for men it seems they are prepared to take risks. It's clear, men are appointed for potential and women for attainment. This ‘attainment trap’ stops women of potential getting onto executive committees. Businesses must take the same risks on promoting and appointing women as they do with men and encourage women to seek opportunities that stretch their capabilities. Pipeline research reveals sponsorship initiatives are more successful than other interventions, for example coaching or mentorship schemes.

WOMEN AND MEN AREN’T THE SAME

Many companies try to solve the gender gap by designing out bias. Don’t. Instead recognise that men and women are different, and that specific interventions are needed for each, for example tailored leadership and development programmes. Women respond to clarity in job roles1 and reward packages, so organisations need to be more specific in these key areas about what they want if they are to attract and promote more women.