The Parker Review deadline is almost up, but has there been any progress for BAME representation in FTSE 100?

The Parker Review deadline is almost up, but how much progress has there been for BAME representation in FTSE 100?

In 2017, the government-backed Parker Review gave FTSE 100 companies four years to appoint at least one BAME board-level director.

The given deadline was 31st December 2021 and with that date fast approaching, we take a look at whether any progress has been made.

In March 2021, the Parker Review committee published the results of its latest survey of FTSE 100 companies. The survey found that significant progress had been made, with 74 FTSE 100 companies having ethnic minority representation on their company boards as of 2 November 2020.

In addition, by early March 2021, a further seven FTSE 100 companies had appointed directors from a minority ethnic group, effective in the early months of this year.

More recently, data released by Thomson Reuters found that nearly half of FTSE 350 firms had director of ethnic minority background on their board.

Of FTSE 350 companies, 45 per cent, or 123 companies, were recorded as having a director from a black, Asian or minority ethnic background in 2021.

What is The Parker Review?

The Parker Review is a government-backed, independent review considering how to improve the ethnic and cultural diversity of UK boards to better reflect their employee base and the communities they serve.

The report sets out objectives and timescales to encourage greater diversity, and provides practical tools to help business leaders to address the issue.

The report gave FTSE 100 companies four years to appoint one board director from an ethnic minority background. FTSE 250 companies were given until 2024 to appoint one board director. The target is voluntary, but companies that fail to comply will have to explain why.

The deadline for the review is 31st December 2021.

Despite progress being made, there is still more to be done with regards to diversity and inclusion. The March 2021 survey found that progress remains slower in the key functional roles of boards.

Across the FTSE 100 companies that responded to the survey, only five ethnic minority directors occupy a CEO position (compared to six ethnic minority directors that held CEO/Chair positions in 2020), all of whom are men. Two occupy a Chair role, one man and one woman, and four men occupy a CFO role.

Speaking about the impending deadline, Dr Zara Nanu, CEO and Co-Founder at Gapsquare, part of XpertHR, said, “Current lack of ethnic minority representation on boards is not a reflection of lack of diverse talent in organisations.”

“It is more an indication of imperfect systems that have not been great at promoting a growing pipeline of diverse leadership talent.”

“Having a diverse leadership team not only brings better ideas and business outcomes, it can also play a key role in improving employee engagement and retention.”

“Creating pathways for employees from underrepresented backgrounds to positions of power shows that this is a business that takes inclusion seriously.”

“Agreeing targets for greater board diversity will also prompt organisations to view this as a long-term strategy, not a one and done tactic.”

“Diversity and inclusion must go beyond the bare minimum – inclusion is an ongoing practice that business should continually strive to improve and develop by using data, facing the gaps, and implementing an actionable plan that can make a real difference.”