Corporate Boards (Diversity)

Debate between Julian Knight and Chuka Umunna

Wednesday 28th October 2015 Commons Chamber

[Mr Umunna]

I could not agree more with my right hon. Friend. Lord Noon was a trailblazer, and his passing is a great loss for our country. On behalf of Members in all parts of the House I extend our sympathy and condolences to his family. He was a big man and he made a huge difference.

Effecting change so that we have more Lord Noons and more diversity in the boardroom has required leadership from business groups such as the CBI, the Institute of Directors and the women’s 30% Club. The last Business Secretary also undoubtedly forced change. One of the most important aspects of this debate is the Government ensuring that they keep on the table for business the prospect of more prescriptive action if a business-led approach does not achieve sufficient change. The result of what was done on gender is that in 2015 there are no all-male boards in the FTSE 100, and 26.1% of board members overall are women—a fantastic achievement.

[Julian Knight (Solihull) (Con)]

I congratulate the hon. Gentleman on securing this debate on a very important topic. He mentioned that there are no all-male boards in the FTSE 100, but there are 23 all-male boards in the FTSE 250. That is an important point, and I wonder whether he could reflect on the fact that it is not just about boards in the big companies; it is about how we encourage both gender and ethnic minority diversity in middle-sized companies and also in middle management.

[Mr Umunna]

The hon. Gentleman is absolutely right; we are talking about the pipeline. He pre-empts my point that, given that we have seen such fantastic progress, there is now a strong instinct to take our foot off the pedal. Yes, the glass ceiling for women is starting to show cracks, but we have yet to smash it. We now need a crusade to ensure that we increase the number of female executive directors. It is a disgrace that in 2015 there are so few women at CEO level in the FTSE 100 and beyond when there is such an abundance of talent out there. That should not detract from our enjoyment of the moment tomorrow when Lord Davies presents his final report and reflects on what has been achieved on gender.

If gender diversity has increased, however, the appalling lack of ethnic diversity in UK boardrooms persists, and progress has gone into reverse in 2015. That is no way for our country to mark the 50th anniversary this year of the first Race Relations Act. The latest annual survey of 10,000 top business leaders by executive recruiter Green Park, which has done fantastic work in this area, shows that the number of visible ethnic minority CEOs is falling, and the number of all-white boards is increasing, at a time when 14% of our population is from a black or minority ethnic background. Today there are just four non-white CEOs in the FTSE 100, following Tidjane Thiam’s move from Prudential to Credit Suisse.