Board diversity on the up

Anyone who invests in a company quoted on the London Stock Exchange should take an interest in how that company is run. Not only is it important to have an insight into the approach the management team takes towards the activities and the future direction of the business, it’s also worthwhile to know how balanced its approach is to aspects such as diversity.

There are many historical reasons why women have been underrepresented in boardrooms. Thankfully, that is now changing and there is evidence of progress over the past five years. The Hampton-Alexander review – an exercise with government backing – has reached its initial goal of having a higher number of females in senior positions at major companies.

Its target was to have women board members at one-third of the firms in the FTSE 100 and FTSE 250 indices by the end of 2020 – a reasonable objective for the review, which was launched in 2016. The figure on 11 January was 34.3%, representing a rise from 30.6% at the end of 2019.

While this is progress, there is no doubt that there is still some way to go before women’s representation reaches acceptable levels. However, it does show that bosses take the situation seriously.

A company’s aim to achieve greater diversity is a sign of its management style and suitability for modern business. It’s something we look at, and if you’re looking for independent financial advice in Shropshire, we would be happy to discuss this with you.

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