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This article was first published on LexisLibrary on 4 April 2014. Click here for a free trial of LexisLibrary.

Women on boards--how to keep progressing

Abstract Corporate analysis: John Heaps, chairman of Eversheds LLP, discusses the 2014 Women on Boards report and the future for diversity in high-level business positions. Analysis Original news Report: Women on boards--Davies Review annual report 2014, LNB News 26/03/2014 138 While there has been much improvement in women's representation in the boardroom since Lord Davies' 2011 'Women on boards' report, there needs to be continued action if the 25% target is to be met by 2015, according to Lord Davies' 2014 annual review. The review sets out both the progress that has been made over the past year in increasing the number of women on FTSE 350 company boards and what the focus will be over the coming year in order ensure the 25% target is met. What is your reaction to the report and what are its key points? First of all it's excellent to see genuine progress being made. That is the first and most important point. In terms of the key findings compared to 2011, the fact that the percentage of women on FTSE 100 boards has risen to 20.7% is very significant, because these statistics don't move easily. You don't renew the whole of the board every year. People tend to remain on boards for a period of time, sometimes eight or nine years, so there is inevitably a time lag here. This represents very significant progress. It is a testament to the quality of the debate and the discussion that has emerged since Lord Davies' report that these statistics are improving significantly. Is the lag between shortfall in women in executive directorships, as compared to non-executive directorships a concern? In 2011, and then again in 2013, we released our own study, the Eversheds Board Report, into board composition and the impact it has on the share price performance of a company. The results showed that companies which had a stronger share performance had smaller, more diverse boards with a higher ratio of non-executive directors to executive directors. Generally speaking, the number of executives that sit on boards is smaller than the number of non-executives, so statistically because it's a smaller number it's going to be difficult to shift it. Having said that, the key question now for companies is not just about the representation on the board at the highest level, but also about the pipeline and what is happening throughout the organisation as people rise through the ranks. The report does not address that subject because it is addressing more specific questions of gender diversity on the boards of companies. Although there is still a long way to go, there is other evidence to suggest the pipeline is strengthening.

Are there any particular issues of concern? Sometimes people will say the argument has been won for more diverse boards for a variety of reasons--including the elimination of group-think and having a greater access to talent, because if you cut out 50% of the population you reduce the talent pool. The question though is, having won the argument, what will be done to ensure implementation? There are even now issues of conscious as well as unconscious bias. Others are of the view that it is purely an issue of unconscious bias, but I think there are still issues of conscious bias to be addressed as well. While the battle is not won and considerable effort must go into changing the way that organisations attract, develop, retain and promote their colleagues, we can be optimistic going forward that the situation will continue to improve. What next steps should be taken to work towards diversity? The first and most important issue is that the topic continues to receive constant and regular exposure, so people talk about it. One of the greatest features of the past few years is that there has been a developing debate, so that it's a topic people are aware of and discuss. That needs to continue. The more it's discussed and debated in the places that decisions are being made, the more likely it is that these changes will be made. It will also be important that opportunities are created in the right way. One of the difficulties of the process by which people are appointed to boards is that it is run through search agents. These posts are very rarely advertised, and while it's very good indeed to see that many of the search community have signed up to a voluntary code, they are to a large extent in charge of this process and a key catalyst for change. It's up to them to make sure that women are included in the long and short lists for senior positions. I am a signed up member of the 30 Percent Club, of which the signatories promised by 2015 to achieve 30% of their boards would be female. Eversheds achieved that last year. What should lawyers take note of and what can they do to work towards diversity? At Eversheds we have a governance structure that is very similar to a corporate structure. Our female membership of the partnership is about 24%. But last year more than 40% of the successful applicants to partnerships were women, so while the overall statistics are going to shift slowly it's what is happening year by year that is important. About three years ago we noticed that statistic was stuck at around 23%, and we commissioned Ashridge Business School to do some research. As a result, we have had a campaign led by one of the firm's partners, Ian Gray, with a number of initiatives designed specifically to encourage more women into partnership and leadership positions. The issue of flexibility is very important. A year ago I was approached by Sir Win Bischoff to join a group to examine issue of flexibility, which has worked through into an organisation called the Agile Future Forum. The concept of agility is incredibly important. It's not just about flexible working, it's about making businesses more agile and flexible, and less traditional in their approach to work and the working environment (how, when and where the work is done). If you think about it in those terms, the argument for flexibility is very compelling. We were asked to conduct a project in one of our offices, and we chose Cambridge. We invited a group of people to discuss among themselves how they would prefer to manage their time in a more flexible way. The whole office from partners to secretaries was involved. They came forward with a plan and that office became 12% more productive, so there is a very important business reason for embracing flexibility. I'm also a great fan of sponsorship. Whether you are male or female, young or old, you need a sponsor--someone who will speak up for you at critical moments in your life, whether that person is in the room metaphorically or actually. I think that people traditionally have been very British about it--independent of mind--they prefer to do things on their own. It's not realistic--you have to seek out help. Women would probably acknowledge that they have been more passive than men in the development of their career, less likely to seek help. It's a tough old world and people want to know that they are competing on equal terms but that means that you have to ensure that you are getting the benefits that are available to you. In Eversheds there are mentoring programmes in place to ensure that talent rises to the top.

Businesses should also review recruitment and promotion processes, and re-evaluate measures of success as the new world of work demands skills and attributes found equally in both genders. In many organisations this will require a shift from their stereotypical model of success as previous generations will have moulded the style of management and desired characteristics in certain sectors which remain a male preserve. These norms must be challenged in order to ensure a fair representation of men and women throughout the organisation, from the most junior employee to senior management. At senior management level, as I said, it can be tough to shift these statistics because people remain on boards for a period of time and that is true of partnerships too but I am proud of the fact that on the equivalent of our executive board, we have exceed the 30% target in terms of female partners. What are your predictions for the future? Things will continue to improve in the way that is anticipated, but only if the debate continues and people don't just assume that the argument is won. And secondly, if people recognise that this is not something that is just going to happen--they have to be much more interventionist in their approach. When they see people's careers slowing down from the point of view of their ambitions, they have to step in and make sure that the people who have the talent to develop are not being held back or deterred. Interviewed by Dave Thorley. The views expressed by our Legal Analysis interviewees are not necessarily those of the proprietor.