Bias behind failure to select women for FTSE boards revealed

Women are under-represented at board-level but UK banking is seeing positive change, new research has found.

Flawed selection procedures and entrenched bias are combining to minimise the numbers of women on FTSE company boards, according to new research.

Dr Claire Barnes, an organisational psychologist at Birkbeck, University of London, found that women who were would-be directors of the UK’s top organisations were being failed by a system which favoured the status quo.

Through a series of 12 interviews with board chairs and CEOs of FTSE 250 companies – the study, called Women Directors on FTSE Company Boards: An exploration of the factors influencing their appointment, investigated the factors behind the sluggish progress of equal gender representation.

In the UK, women hold 29% of FTSE 100 board seats, a rise of 5.5 percentage points on 2015’s figure. However, this increase refers to the number of non-executive directors.

The proportion of executive directors, full-time employees who direct the day-to-day running of the business, has risen by less than two percentage points over the same period.

Despite acceptance of the need for greater diversity on boards, Barnes identified a “residual awkwardness“ and lack of clarity about diversity and protected characteristics from those interviewed.

While acknowledging the talented women in their business communities, many interviewees complained that there weren’t enough appropriate board candidates. Barnes found that they failed to ask themselves how these factors could co-exist and what their roles and responsibilities might be in resolving them.

Barnes said that her interviewees claimed to be unbiased in their appointments, but their descriptions of successful female candidates showed clear gender stereotypes, such as “firecracker”, “exceptional woman” or a woman being appointed as a “big, bold step.”

“Public companies are largely controlled by well-educated white males, and like other dominant groups, they tend to perpetuate and reinforce the status quo through their biases. When dominant groups are in control, they can find it difficult to deal with inequity head on as it isn’t in their interests to do so,” said Barnes.

As well as inherent internal bias, flawed selection procedures for board members were hampering efforts to appoint women to the most senior roles, the interviews revealed.

Nearly all chairs and CEOs interviewed were critical of large executive search companies that took a “cookie cutter” approach to finding new talent, failing to appreciate individual differences and nuances.

Barnes identified improving selection processes as the key way of improving practice. She found that some chairs and CEOs advocated for using boutique, creative head-hunters that would provide more representative shortlists.

She warned against using selection criteria such as “fit”, because this could easily be substituted for “people like me”. Instead, Barnes recommended that both executive search companies and chairs should develop robust selection methods that could deal with assessing more contextual information and achievements and reduce the perceived risk and anxiety that some participants displayed when faced with suggestions that they should recruit off the usual grid.

Barnes saw executive search companies as crucial agents of change: “These organisations have a huge opportunity to seek out and support a wider pool of female talent. Public company chairs should continue with the good work in increasing the number of women on boards and initiate discussions with their CEOs and human resources professionals as to how to build their female executive pipeline.”

Occupational psychologists should also play a role in supporting decision-making and developing innovative ways to help clients understand bias, Barnes advised.

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