EU Report: Women on Boards

Baroness Ford Excerpts

Tuesday 13th November 2012 Lords Chamber

[Baroness Ford]

My Lords, I thank the noble Baroness, Lady O’Cathain for securing this incredibly topical debate. In the 1980s, she was the Chief Executive of the Milk Marketing Board, then a very important national organisation. She was a powerful role model for many of us who followed her in business. The European Union Committee has delivered a very thoughtful and practical report on this issue. Its preference, and that in the report of the noble Lord, Lord Davies, is for companies initially to have some time to deal with this issue rather than immediately impose quotas. I believe that they are right in this as things are now changing very rapidly. When I was first appointed to the board of a private company 20 years ago, it was something of a novelty. The usual excuse for not having diversity in boards was that not enough experienced women were available. Even if it was true then, which I doubt, it is nonsense now. A whole generation of women have had successful executive careers and form a huge pool of talent available to fill board positions.

However, we need to embed these changes and make sure that they stick. The question is how best to do that. In the minute remaining, I want to say that one thing strikes me as particularly important. We must continue to exert pressure on companies whose boardrooms are still one-dimensional and also on those search firms whose research is particularly weak in this area. We must embed diversity in mainstream corporate governance in line with the UK code. I am absolutely sure that this is the best way to proceed. At the moment, companies show their range of professional advisers in their annual report—their brokers, their auditors, their lawyers—but they do not show their search firms. It would be hugely revealing to have this information made public. I welcome the changes proposed by the Financial Reporting Council in this regard. I believe that it will demonstrate, as lots of us know from our own experience, that certain search firms, as well as certain companies, are much better than others at thinking laterally and behaving inclusively. If the last few years have shown us anything about institutions and organisations in this country, it is that the very best way to effect change is through transparency.