Diverse Routes to Diversity – the DAX and the FTSE

berlin-web smallConsensus is building internationally that diversity promotes business performance. However, different markets have adopted very different approaches. This is a good thing. Fidelio has a clear focus on building Boards fit for the future; as such we have long argued that the route to Board diversity cannot be uniform. 

In this context, on 4th April, Fidelio will co-host with Nabarro its second seminar on achieving Boardroom diversity “Die Frauenquote – a Year on. An Update on Diversity in UK and German Corporates”.

Supported by the German-British Chamber of Industry & Commerce and the German British Forum, this debate will explore the distinctive approaches adopted by the UK and German governments to increase the Boardroom diversity of our leading public companies. Our panel of Chairs, Non-Executive Directors and Investors is eminently qualified to shed light on what works and what doesn’t:

Dame Helen Alexander – Deputy-Chair of the Hampton-Alexander Review; Chairman of UBM plc, Non-Executive Director of Huawei UK

John Allan – Chair, Tesco plc, Barratt Developments plc and London First.  He is also a Non-Executive Director of Worldpay Group plc, and former roles include CFO of Deutsche Post

Elisabeth Lady Stheeman – Supervisory Board Member of Aareal Bank AG; Supervisory Board Member of TLG Immobilien AG; Senior Advisor, Bank of England/Prudential Regulation Authority

Hans-Christoph Hirt – Executive Director and Co-Head, Hermes EOS

This debate is relevant for Directors and senior Executives interested in Board effectiveness and the impact of diversity, including within the UK and German markets. For further information, including details of attendance, please contact Emily Baker.

Quota vs Non-Quota

Following the Davies Review in 2010, the UK Government set voluntary targets for increasing gender diversity in the Boardroom. The 2015 target of 25% female representation in the Boardroom was met, though not by a substantial margin, and the 2016 Hampton-Alexander Review has set new voluntary targets of 33% female representation at Board level across the FTSE 350 by 2020. Among FTSE 100 companies the target also extends to achieving 33% at Executive and direct report level.

Clearly important first steps have been taken in the UK, but as the most recently compiled data shows there is still some way to go with the proportion of women on FTSE 100 Boards currently at 27% and 23.2% for FTSE 250 Boards.

Germany by contrast has adopted a legally binding quota, which came into force in 2016, requiring Supervisory Boards to ensure 30% female representation with the sanction of Supervisory Board positions being held vacant until targets are met. For the DAX 30 representation of female Supervisory Board members reached 30% by the end of 2016; across the top 100 German public companies female representation at Supervisory Board level is 27.5%. While the quota has resulted in gains to the number of women sitting on German Supervisory Boards, female representation on the Management Board remains single digit.

Importantly in both the UK and Germany measures are also being taken to reduce the gender pay gap and also to promote a much broader definition of diversity. In the UK for example the 2016 Parker Review introduces voluntary targets for ethnic diversity in the public company Boardroom.

Next Steps

Diversity is increasing in German and UK Boardrooms. On 4th April our speakers will review progress to date and importantly look forward to steps and initiatives that will enable companies achieve their goals and build effective Boards and leadership teams fit for the future.

For further information please contact Emily Baker

About Fidelio

Fidelio is a Board Development and Executive Search consultancy with a clear focus on building effective public company Boards and leadership teams fit for the future.  We do this through Search, Development and Evaluation, underpinned by a deep understanding of what shareholders and stakeholders expect from the leadership team. Diversity is hardwired into every aspect of Fidelio’s offering. Based in London we work internationally.

For further information on how Fidelio supports clients through Search, Development or Evaluation, or of Fidelio’s “A Seat at the Table”  Programme for senior female executives and directors please contact Gillian Karran-Cumberlege, or alternatively call + 44 (0) 20 7759 2200.