The latest review into black and minority ethnic (BAME) representation on the boards of large companies has reported that just under half the companies surveyed did not have any.
This was the stark finding from the 2020 Parker Review Committee, which was commissioned to consult on the ethnic diversity of UK boards. In its first report, published in 2017, the Review made a series of recommendations and set a target for all FTSE 100 boards to have at least one director from an ethnic minority background by 2021, billed as “One by 2021.”
However, according to the most recent Parker Review report (which is based on voluntary data submissions), the pace of progress has been slower than hoped. Indeed, it concludes that it will be challenging for FTSE 100 companies to hit the “One by 2021” target recommended by the 2017 review.
In 2017, more than 50 per cent of FTSE 100 boards (51 out of 100 companies analysed) had no ethnic representation on their boards. This compares to 37 per cent of FTSE 100 boards in 2020 (31 out of 83 companies surveyed).
The latest data reveals that, since the 2017 Review, 11 additional FTSE 100 companies now have an ethnic minority director on their board.
In addition, the 2020 Parker Review provides first time analysis of FTSE 250 boards, which were found to be even less diverse than the FTSE 100 - 69 per cent of the FTSE 250 companies analysed (119 out of 173 companies) have no ethnic diversity on their boards. Across the FTSE 350, 59 per cent have no ethnic representation on their company boards (150 out of 256 companies analysed).
In total, 98 out of 868 directors who have disclosed their ethnicity in the FTSE 100 are from ethnic minority backgrounds, compared to 80 out of 1,503 directors who have disclosed their ethnicity in the FTSE 250.
Looking at specific leadership roles across the companies surveyed for this year’s report, just six ethnic minority directors hold the position of chair or CEO in the FTSE 100 and nine in the FTSE 250.
Of the ethnic minority directors in the FTSE 350 companies which engaged in the survey, 43 per cent are women. This breaks down to 41 per cent of BAME directors in the FTSE 100 and 45 per cent of BAME directors in the FTSE 250 who are female.
Matthew Pull, of Thompsons Solicitors, commented: “The 2017 Parker Review Recommendations included that each FTSE 100 Board should have at least one director from an ethnic minority background by 2021, and that each FTSE 250 Board should have the same by 2024. What is clear from the 2020 review is that without urgent action by these companies, and, if necessary, the government, to significantly increase the pace of change, these relatively modest recommendations will not be met.”
To read the full report, go to: https://assets.ey.com/content/dam/ey-sites/ey-com/en_uk/news/2020/02/ey-parker-review-2020-report-final.pdf