International Women’s Day

Lord Davies of Abersoch Excerpts

Thursday 1st March 2012 Lords Chamber

[Lord Davies of Abersoch]

Hear, hear! I think that my speech should also be deleted from Hansard.

For the past 12 months I have been involved in the debate about women on boards. It has been an education for me. I have learnt much and grown in many ways. It has been a humbling experience to meet so many women of such talent. It has been a huge test for my wife of 33 years, because it seems that every day I come home and talk about other women, which has tested her patience.

Noble Lords do not need me to tell them that the more diverse a team is—with different backgrounds, skills and intellectual capabilities—the better the debate and the results will be. It is true of sport and certainly of business. What I have discovered is that this is not just a matter of gender quality but of performance. The statistics and the evidence are there. The more diverse a team, the better is its business performance. I do not believe that we should have quotas but should self-regulate—and I believe that that is what women want. I can see some heads shaking already. That is what is great about this debate.

It is also true that in the UK we need more female role models in business; we need more female entrepreneurs; and we need a radical change in the boardrooms of Britain. Success has many fathers—perhaps today I should say “mothers”. When I started this campaign, shareholders were uninterested and had no appetite for the debate. Headhunters, with one or two famous exceptions, blamed a lack of supply. Chairmen blamed the headhunters. Effectively, everybody blamed everyone else and no progress was made.

A year on, we are at a tipping point. I would not say that we have cracked it, but we are making great progress. The barriers are numerous. Apart from “men’s club” practices, childcare needs a major public review in the UK. It is in the interest of all parties who want a fair society and good business practice to give urgent attention to childcare needs. We are moving to a world of different, flexible working, with different attitudes towards careers. People will work for 60 years; they will live longer and have different careers. Therefore, their attitude to work will be different. It is also clear that a good company and an employer of choice will need diversity and equality at the top. The reality of business today is that we do not have that.

A number of noble Lords may say that the figure of 25 per cent was chosen as an absolute minimum, and that the report shows that it is reasonable and achievable. Today, one year on—we publish our report in a few days—I am very confident that we will get to 25 per cent, but we must keep the pressure on. Perhaps 25 per cent is a bit low but it is not a number that we plucked out of the air. It takes account of the nominations committee process, the number of board members that are leaving and the fact that boards are shrinking in the UK.

Here is where we are today. Women now account for 15 per cent of the FTSE 100. We have had the largest ever annual movement in the UK. Over the past year there have been about 100 new female NED appointments—what great news. A great development is that 50 per cent of them had never sat on a board of a public company before. There is a huge talent base in education, health, the charities sector and the services sector that the headhunters and chairmen have to reach into. There is a gene pool of talent in the UK. I just do not buy the argument that the female supply is not there.

When we started, there were 21 or 22 all-male boards, and now we are down to 11. Most of those are mining companies. The media are listening and my message to these companies is: “We should name and shame you. You need to put your house in order. It is not acceptable to have an all-male board in today’s world”. We know who they are. However, three companies have now reached 30 per cent female board representation: Diageo, Burberry and Pearson. Fifteen companies in the FTSE 100 have already reached the 25 per cent target. This is great progress, with a new type of individual being approached. I am confident that we have made great progress.

However—and this is where the media are going to play a key role—we need the media to keep the pressure on; we need to keep debating the issue. I was in Brussels a week ago debating with the Commission its attitude towards it. I do not believe we should go to quotas but we need to keep the pressure on and we need to embarrass the companies that are not attacking this issue. Once we have achieved this, then we need to tackle the issue of the executive committees of major companies.

So there has been progress. I thank the noble Baroness, Lady Verma, and many other noble sisters in the Chamber who have helped me in the past 12 months.