The number of FTSE 350 companies with a director of colour has jumped 108% over the past year, as companies face greater pressure to increase diversity across top leadership roles.
The increase means that 123 of the largest listed firms now have a black, Asian or minority ethnic director (BAME) on the board, up from just 59 last year, according to Thomson Reuters which compiled the data. That accounts for nearly half of the FTSE 350, at 45%.
“It is important that companies continue to make improvements in this area, as there seems to be no slowing in the drivers for increased board and leadership diversity, including pressure from politicians and regulators,” Hilary Owens Gray, a director of practical law at Thomson Reuters said. “Evidence shows that more diverse businesses can be more successful businesses and ultimately deliver better long-term returns for shareholders.”
The increase in representation comes as companies race to meet voluntary deadlines to appoint at least one BAME director to their boards as part of the government-backed Parker review, which tracks ethnic diversity across stock market-listed companies.
The review, which launched in 2017, gave FTSE 100 firms until the end of 2021 to appoint at least one BAME board-level director. The same target was set for the FTSE 250 companies, but with a deadline of 2024.
It also follows the UK regulator’s plans to require listed companies to either achieve targets for ethnic and gender representation on their boards, or publish an explanation as to why they continue to lag behind.
The proposals, which would require changing the UK’s listing, disclosure and transparency rules, would also force listed companies to publish data on the gender and ethnic composition of their boards, as well as across senior executive roles.
Currently, women make up 39% of all directorships across the FTSE 100, up from 35% last year, holding a total of 402 roles, Thompson Reuters research also found.
About 46 companies now have boards where women hold at least 40% of the roles, compared with 31 in 2020 and just 25 in 201, suggesting “significant strides” had been made towards gender parity at board level, the report said.
However, representation at the executive level was far lower, with women making up just 14% of positions across the UK’s 100 largest listed firms. “FTSE 350 companies are taking great strides to increase diversity at board level. However, there is more progress to be made,” Gray said.
