We need more women on boards

Having more women in senior positions creates a richer business, says Jacqueline Gold.

Let’s imagine that a few years ago, the board of the high-profile, much-loved retailer that you work for, appointed a new chief executive to run the business.

They scoured the world for the most experienced executive on the global high street, with a proven track record of success and swiftly got their man.

Industry experts and media commentators regard him as one of the best ever leaders and see his appointment as a coup for your organisation.

In the last two years, despite a challenging environment and significant progress made by your key competitors, the business and your chief executive have met every target set by and promised to the board.

Lessons had been learned from previous seasons’ trading performance and as a result the chief executive has brought in new talent, who are already having a very positive impact. In recent results you have even beaten a key competitor, broadly recognised as being the best in the world.

With an established management team in place you are only a few months away from your key trading period and final tweaks are being made to the business plan that has been years in the making.

Then without consulting your chief executive, the board sacks your director of operations, not because of their performance at work but because they were concerned that Retail Week and other industry commentators might speculate about the outcome of a forthcoming court case.

As a matter of principle your chief executive offers to resign and for reasons not given to shareholders or other stakeholders in the business, the board accepts. Would you want to work for a business like that? Clearly Fabio Capello didn’t.

On the day that Harry Redknapp was found not guilty, depending on your point of view Capello’s resignation was either serendipity or clever business manoeuvring by a board keen to make a change but for me the interesting coincidence was that it came just as David Cameron was calling for more women to be appointed to company boards.

The Government’s position on this issue draws from a McKinsey report titled Women Matter: you should read it, it’s very good. Here’s a flavour of some of their findings: 55% of university graduates in Europe are women yet women only occupy 12.5% of FTSE 100 company board positions.

That’s a huge waste of talent. Statistical analysis on a range of financial criteria (return on equity, EBIT and share price growth, etc) shows that companies with a higher proportion of women on their boards and management committees have the best performance.

They also found that having more women on a company board gave them a “richer set of ideas”. Improving the pathway for women from junior management to executive management is not about doing the right thing for women -– nor incidentally is it about quotas – it’s about doing the right thing for your business: quite simply you will be more successful with more women on your board.

Number of women on the FA board: zero.