EU Report: Women on Boards

Lord Bilimoria Excerpts

Tuesday 13th November 2012 Lords Chamber

[Lord Bilimoria]

My Lords, in 2003 I was a member of the Tyson Task Force on the Recruitment and Development of Non-Executive Directors, where we examined,

“how a range of different backgrounds and experiences among board members can enhance board effectiveness and by exploring how a broader range of non-executive directors can be … recruited”.

I thank the noble Baroness, Lady O’Cathain, for initiating this debate and I am relieved to see that the EU Committee’s report is emphatically against imposing quotas. There are two issues here: how can we continue to encourage UK plc to have the most effective boards, and secondly, how can we ensure that UK plc pursues equality of opportunity? It is not just about doing things right, but about doing the right thing because it makes sense.

Apart from chairing the Cobra Beer Partnership Ltd and Molson Coors Cobra in India, for the past five years I have been a non-executive director and the senior independent director of the Booker Group plc, a FTSE 250 company. When I first joined the board five years ago, there were no women, but that situation has changed. I am proud to say that we have a very effective board that has seen the company’s value increase virtually five times in five years. What is key is finding the best individuals for the board with diverse skill sets, backgrounds and experience that are as relevant to your business as possible, and increasingly that should include international experience. It is the responsibility of the chair to search as widely as possible to find these individuals, as well as the responsibility of headhunters. Although it is good news that more than 50% of FTSE 250 companies now have at least one woman on their boards, we could do so much more. As was said earlier, the Cranfield University School of Management, of which I am a proud alumnus, in its 2012 Female FTSE Board Report identifies more than 2,500 women who are ready and capable of taking on board positions.

We need to persist in encouraging and highlighting the benefits of diverse boards, and in particular having more women on boards. The report of the noble Lord, Lord Davies, is doing this in the same way as the Cranfield University School of Management report, and in the way that the EU Committee’s report is doing it. Jennifer Harris, the managing director of Board Intelligence, wrote last year that:

“Boards make important decisions and diverse boards might make better ones”.

From my experience, I have seen that they definitely do. I shall conclude by saying that we need look no further than your Lordships’ House. I would go so far as to say that this is the most expert and the most diverse upper House in the world. We did not need quotas to achieve this; we have done it because it makes us more effective, and because it simply makes sense.