UK: FTSE board diversity - fifth and final report from the Hampton-Alexander Review

The Hampton-Alexander Review published its fifth and final report today. The report notes that the voluntary target set five years ago - for women to occupy a third of FTSE100, 250 and 350 board positions by the end of 2020 - has been met. A copy of the report is available here (pdf) and a press release is available here (pdf). A press release from the Department for Business, Energy and Industrial Strategy has also been published: see here.

UK: FTSE100 remuneration - preview of forthcoming report from Deloitte

Deloitte today published a preview of some of the findings from its forthcoming review of directors' remuneration in FTSE100 companies, due to be published in October: see here. These findings include: the median CEO package is £3.4 million; approximately one third of FTSE100 companies have reduced pensions for new executive appointments; and a reduction in the number of companies receiving low votes (below 80% in favour) on remuneration.

UK: Cranfield's Female FTSE report 2019

The latest annual edition of Cranfield University's Female FTSE Board Report has been published: see here (pdf). To quote directly from the executive summary:

This year we see a more encouraging picture emerging in terms of the number of women on FTSE boards. Over the past 12 months the percentage of women on FTSE 100 boards has increased from 29% to 32%, so the 33% target set for 2020 is well in sight. In total 292 women hold 339 directorships on FTSE 100 boards. The percentage of female non-executive directors (NEDs) is at the all-time high of 38.9%, whilst the percentage of female executives remains worryingly low at 10.9%."

However, and to quote from the report's concluding remarks:

We are pleased to report on the good progress achieved this year in terms of increasing the number of women on both FTSE 100 and FTSE 250 boards. .... What is very concerning is the mounting evidence to show that once women are appointed to boards they have significantly shorter tenures and are less likely to be promoted into SID [Senior Independent Director] or Chair roles. The number of women holding Chair roles across FTSE 100 boards has actually decreased on the already low levels of last year. Urgent action needs to be taken on addressing this issue, hence we welcome the initiative set up recently to accelerate women into Chair roles. It is vital that women are not appointed to boards because of the symbolic importance. This is not the case of just ticking a box. One of the routes into Chair is to acquire experience running a board committee, hence it is positive news this year that the percentage of women chairing such committees across FTSE 100 boards has increased to 31%. Clearly women directors have many more strengths to offer beyond being women. In our extended analysis of their diversity this year, we see that the women directors across FTSE 100 boards come from many countries (only 55% are British), different ethnic backgrounds, a range of universities (with only 11% from Oxford and Cambridge), are financially extremely literate (55% have held various financial roles) and won many awards. We certainly do not have enough women from BAME backgrounds nor women from outside of the corporate mainstream. We also note that the average age of women directors is several years below the average age of men directors, indicating another bias. All these gaps in the talent pipeline must be addressed if the UK is to fill its boards with the best individuals available."

UK: Hampton-Alexander review - women on FTSE350 boards

The Hampton-Alexander Review published an update today on the number of female directors appointed to FTSE350 company boards: see here (pdf). The headline figures are: 32.1% of FTSE 100 board positions are held by women (up from 12.5% in 2011); in the FTSE250 the percentage is 27.5 (up from 24.9). There are four all male FTSE350 boards (there were over 150 in 2011).

Notes:

The 2019 Hampton-Alexander Report will be published on the 13 November 2019 and this year's Female FTSE report, from Cranfield's School of Management, will be published on 11 July.

UK: Board diversity - Green Park's 10,000 report

Green Park has published the fourth edition of its Leadership 10,000 report, which now includes a ranking of FTSE100 companies in respect of their success and commitment in improving leadership diversity: see here. The report notes that 58% of FTSE100 boards have no directors from ethnic minorities; the Parker Review recommended, last year, that by 2021 all FTSE100 boards should have at least one director of colour.

UK: CIPD/HPC annual survey of FTSE100 executive director pay

The CIPD and High Pay Centre have published their annual survey of FTSE100 executive director pay: see here (pdf). To quote the opening paragraph from the executive summary: "Our review of FTSE 100 CEO pay packages shows a sharp turnaround in the rising trend of remuneration. FTSE 100 CEOs have seen an overall drop in pay packages, especially at the top end, though the gulf between the highest paid executives and the rest of the workforce still remains".

UK: The Parker Review on the Ethnic Diversity of UK Boards

The Parker Review yesterday published its report on the ethnic diversity of UK boards: see here (pdf). The report found that 8% of the 1,087 FTSE100 director positions were held by directors of colour, with seven companies accounting for over one third of these directors. Over half (53) of FTSE100 boards do not have any directors of colour. The report makes a number of recommendations including that all FTSE100 boards should have at least one director of colour by 2021. The same recommendation is made for FTSE250 boards but with a 2024 deadline.

UK: KPMG's Guide to Directors' Remuneration 2013

KPMG has published its Guide to Directors’ Remuneration 2013, which presents an analysis of the pay of FTSE350 directors: see here (pdf).

UK: FTSE350 companies and their subsidiaries

In a speech delivered in July this year, the Secretary of State for Business, Innovation and Skills said that he was examining how FTSE350 companies meet the legal requirement to identify their subsidiaries in their accounts and/or annual return: see here. Yesterday it was announced, following a review by Companies House, that 124 companies had failed to provide a full list of their subsidiaries: see here (pdf).

UK: FTSE100 chief executive remuneration - High Pay Centre report and recommendations

The High Pay Centre has today published a report titled Paid to Perform? What do we want our business leaders to achieve?: see here (pdf). The report presents an analysis of the information within the annual reports of FTSE100 companies with regard to the performance measures used for chief executives and makes various recommendations including the requirement that at least fifty per cent of performance related pay should be linked to non-financial metrics.

The report found that the remuneration package for every chief executive was predominantly calculated using financial performance measures, with total shareholder return being one of the most popular measures. Thirty-eight companies stated that they assessed their chief executive's performance with regard to non-financial factors. Companies that had experienced recent serious reputational damage - such as BP and Barclays - had the largest proportion of non-financial measures linked to their chief executive's long-term incentive plan.

UK: ABI publishes board effectiveness report

The Association of British Insurers has published its second report on board effectiveness: see here (pdf). Based on an analysis of FTSE350 company reports, a survey of FTSE350 company secretaries and interviews with company chairmen, the ABI finds that boards are making clear progress on diversity and the use of external evaluation but need to do more on disclosing their approach to succession planning.

UK: FTSE UK Index Series - free float minimum to become 25%

Following its recent consultation, the FTSE Group has announced that the minimum free float for UK incorporated companies in the FTSE UK Index Series will be increased from 15% to 25%, from 1 January 2012: see here (.doc). Those companies already admitted with a lower free float have 24 months to comply with the new requirement. The FTSE Group has also announced
FTSE will undertake further consultation on whether a higher threshold would be appropriate, or whether additional governance standards should be incorporated in the FTSE All-Share Index.

UK: FTSE Group consultation on minimum free float requirements

The FTSE Group is undertaking a consultation on the minimum free float requirements for UK incorporated companies in the FTSE UK Index Series: see here. It is proposed that the current minimum of 15% should be increased to 25% for companies seeking inclusion in the FTSE UK Index Series.