Commission response to the Financial Reporting Council consultation: Gender Diversity on Boards
Summary of response
- The EHRC supports Lord Davies’ call for amendments to the UK Corporate Governance Code and welcomes the FRC’s constructive proposals for change.
- The EHRC believes that it is important for FRC to include in its case for change the strongly evidenced business case that companies with a higher proportion of women in their executive committees and Boards of directors are also the companies with the best performance.
- The EHRC welcomes the proposed amendment to Provision B.2.4, (the report of the nomination committee) and recommends some strengthening to include a description of the plan for increasing gender equality and a report on progress.
- The Commission believes that it would be helpful to set out the key elements to be covered by the diversity policy as a separate guidance note or as an Annex to the Code. This should focus on gender, including the importance of disaggregated information to identify intersectional issues such as under-representation of black and disabled women on Boards, and also address the wider Diversity agenda.
- The Commission supports the addition of a new supporting principle to Principle B.6 on board evaluation and recommends that this should also include ‘progress on meeting its measurable targets’.
- The Commission would be in favour of an early implementation as suggested in option 1 so that the Code would apply to accounting periods on or after June 29 2011.
- The Commission would welcome the opportunity to work in collaboration with the FRC to ensure that the strategy adopted is successful in meeting the Davies Review target of all FTSE 100 boards to aim for a minimum of 25% women on their boards by 2015, without the need for regulation.
Download the full consultation: Gender Diversity on Boards (Word)
Download the Financial Reporting Council consultation document (PDF external website)