International Women’s Day

Baroness Nye Excerpts

Thursday 1st March 2012 Lords Chamber

[Baroness Nye]

My Lords, I am grateful to the noble Baroness, Lady Verma, for introducing the debate and for her acknowledgement of the work of the previous Labour Government. I also thank my noble friend Lady Thornton for reminding us of the parlous state of women’s representation in Parliament. Every member of the Labour Party to whom I have ever spoken has always said that there should be more women MPs, but nothing was ever done until we decided to take some positive action. Now women constitute 30 per cent of the parliamentary Labour Party, which is double the number in the Conservative Party. It is examples such as that, and those which the noble Lord, Lord Smith of Clifton, mentioned, that have convinced me that quotas for women on boards are necessary. I am afraid that my vote and that of the noble Baroness, Lady Bottomley, would cancel each other out if that issue were put to a vote. The Davies report’s voluntary target of 25 per cent female representation by 2015 is very modest as it is considerably lower than the figure in those countries that have opted for legislation and quotas, and much lower than the figures that are being looked at by the European Commission.

I know that the steering group and my noble friend are adamantly opposed to the imposition of formal quotas for female directors, opting for informal targets instead. However, I believe that this may prove to be mistaken. I obviously hope that the targets are met, as my noble friend Lord Davies of Abersoch, indicated. However, Cranfield University, which conducted a review of the response to the Davies report, showed that many companies were adopting a wait-and-see response. It said that only a third of FTSE 100 companies have set targets for the percentage of women on their boards, and nearly half of the FTSE 250 still have all-male boards. It is a positive development that two-thirds of the women appointed had no prior FTSE 100 or 250 experience, showing that there is a wider pool of talent out there to draw upon.

However, the evidence also shows that it is the companies that have already shown a willingness to address this issue that are prepared to commit to a target. There are simply too many companies out there that still just do not get it, even though studies in the US and Europe have found that the companies with the greater number of women on their senior management teams get higher returns, and that a more diverse board prevents a “group think” mentality. Following a recent consultation, the Financial Reporting Council announced that it would amend its code and encourage companies to implement this measure voluntarily, but with immediate effect. However, I believe that it did so only because quotas were threatened.

Unless we get a faster pace, it will take another century to get gender equality in the boardroom. Quotas could prove to be the only way to achieve what everyone agrees makes good business sense. I, like most women, am a great believer in the compilation of lists because, like the noble Lord Davies of Abersoch, I believe that what gets measured gets done. I therefore hope that the Government are willing to adopt quotas if the self-governing approach fails. As has been said, there is strong evidence that quotas have worked. The most significant result was in Norway. After legislation was passed there, the number of women directors has risen to 45 per cent of the total. To tackle the accusation of tokenism and quality, a Female Future programme was undertaken to ensure that the female candidates had the necessary expertise and experience. The Australian Institute of Company Directors has been instrumental in setting up a similar scheme. With or without quotas, I think we should do that.

France and Spain have also adopted a 40 per cent quota. We should also consider adopting Spain’s policy of giving priority status to firms that meet this target in the awarding of government contracts. I was very pleased that the Prime Minister attended the Northern Future Forum in Stockholm this month to discuss how to get more women to start their own businesses and take on leading positions in companies, and his acknowledgement that there is,

“a positive link between women in leadership and business performance”.

It was also heartening that the Prime Minister told journalists that the option of quotas should never be ruled out. It was not so heartening that, sadly, the next day No. 10 seemed to contradict him, but we will watch that space with interest. Perhaps he also saw in Stockholm that weakening action on the gender pay gap, cutting support for childcare and exploring options for weaker maternity rights make it harder for all women to get promoted throughout their lives. As has been said, lack of affordable childcare is among the biggest problems facing families here. The recent research by the Daycare Trust says that spiralling childcare costs, patchy provision and changes to the tax credit system are creating serious difficulties for working parents.

However, I would like to end on a more positive note with an example of where deciding to make diversity important has made a difference in one of the most difficult areas facing women. When the UK won the bid to host the 2012 Olympics in London, diversity was one of the key elements of that bid. In fact, women hold 30 per cent of the senior management posts on the Olympic Delivery Authority.

As we know, women make up 45 per cent of the workforce but only 12 per cent of women are in science, engineering and technology occupations, and only 1 per cent in SET skilled trades. Through its procurement and use of contractors, the ODA has been able to influence wider employment practices by adopting an evaluation scorecard, which meant that contractors had to address equality and diversity issues. The ODA also started the Women in Construction project, which has successfully helped women access training and employment opportunities on the Olympic Park. This has meant that 1,000 women have worked on the construction of the Olympic Park and athletics village. Women have been trained across the whole spectrum of construction trades to become electricians, bricklayers, carpenters, plumbers or engineers—all non-traditional female roles.

The successful Women in Construction model should be used on other major construction sites, and I hope that the Government will look into this. That really would be an enduring legacy of the 2012 Olympics in London. Britain will show that it can lead the world when the Olympics start on 27 July, but it must no longer lag behind in the role it accords to women in our economy.