In February 2011, Lord Davies published his report "Women on Boards" in which he rejected binding quotas for the number of women on listed company boards in favour of a voluntary, business-led approach (see News brief "Women on boards: targeting diversity").

Among other things, the report recommended that:

The voluntary approach was supported by the government and regular progress reports published since 2011 have shown steady improvement towards the target (see News brief "Women on boards: redressing the balance"; www.practicallaw.com/6-610-2037; www.practicallaw.com/2-526-6164).

The Davies review summary of progress shows that the 25% target for FTSE 100 companies has been reached in October 2015, with FTSE 250 companies not too far behind (see box "Key figures from Lord Davies' five-year summary").

Multiple appointments. One of the concerns with a fixed target, which some commentators originally expressed, was that there would be a small pool of women who would take on multiple board appointments. However, the Davies review states that evidence shows this not to be the case in the UK. In the FTSE 100, only 13% of women directors hold more than one FTSE 100 directorship and across the FTSE 350 as a whole only 20% of women directors hold more than one listed board directorship.

Executive search firms. The Davies review recognises the work done by executive search firms to drive progress on this initiative. In 2011, executive search firms adopted a standard voluntary code of conduct which dealt with gender diversity on corporate boards and best practice for the related search process. This was followed by an enhanced code of conduct in 2014 under which firms could be accredited if they could demonstrate certain achievements in increasing the number of women appointed to FTSE 350 boards.

Investors. Although institutional investor bodies, such as the Association of British Insurers (the Investment Affairs division of which is now part of the Investment Association), were supportive of the push for greater gender equality on boards, the Davies review expresses a degree of disappointment with the overall level of engagement from investors. It asks them to use their collective voice to greater effect and to establish their own best practice guidelines aimed at improving the gender balance on FTSE boards.

Talent pool. 22% of the new female directors had not previously had any listed board experience. 56% of them are classified as plural; that is, they hold no current full-time executive role but engage in a portfolio of non-executive activities. The majority of these plural women work across a variety of sectors, such as private, not-for-profit, government or academic roles. The Davies review comments that, while the pool of talent has been widened to embrace women in professional services roles, those from other backgrounds have not been considered to any great extent.

Although the specific 25% target has been reached, that is not the end of the story. The Davies review emphasises that further work and a renewed focus is required, particularly with regard to boosting the number of women appointed to chair boards and as senior independent directors, as well as to executive director roles and in the executive management layer immediately below the board.

Other countries that have introduced quotas for women board appointments have set their goals higher than the 25% target in the UK. For example, the target in France and Norway is 40% and in Belgium and Italy is 33%. The Davies review warns that if the UK does not progress beyond the current 26% level, it will fall behind European and other countries in the near future. The introduction of an EU directive setting a voluntary target of 40% women non-executive directors by 2020, backed up by an obligation on companies that fall short of that target to appoint a woman candidate where a male candidate and a female candidate are equally qualified, is due to be prioritised in 2016.

The Davies review therefore makes the following five next step recommendations:

For an analysis by Practical Law What's Market of the progress made by FTSE 100 companies in achieving the voluntary target of at least 25% female board representation, see article "Women on boards: where are we now?".

In February 2011, Lord Davies published his report "Women on Boards" in which he rejected binding quotas for the number of women on listed company boards in favour of a voluntary, business-led approach (see News brief "Women on boards: targeting diversity").

Among other things, the report recommended that:

The voluntary approach was supported by the government and regular progress reports published since 2011 have shown steady improvement towards the target (see News brief "Women on boards: redressing the balance"; www.practicallaw.com/6-610-2037; www.practicallaw.com/2-526-6164).

The Davies review summary of progress shows that the 25% target for FTSE 100 companies has been reached in October 2015, with FTSE 250 companies not too far behind (see box "Key figures from Lord Davies' five-year summary").

Multiple appointments. One of the concerns with a fixed target, which some commentators originally expressed, was that there would be a small pool of women who would take on multiple board appointments. However, the Davies review states that evidence shows this not to be the case in the UK. In the FTSE 100, only 13% of women directors hold more than one FTSE 100 directorship and across the FTSE 350 as a whole only 20% of women directors hold more than one listed board directorship.

Executive search firms. The Davies review recognises the work done by executive search firms to drive progress on this initiative. In 2011, executive search firms adopted a standard voluntary code of conduct which dealt with gender diversity on corporate boards and best practice for the related search process. This was followed by an enhanced code of conduct in 2014 under which firms could be accredited if they could demonstrate certain achievements in increasing the number of women appointed to FTSE 350 boards.

Investors. Although institutional investor bodies, such as the Association of British Insurers (the Investment Affairs division of which is now part of the Investment Association), were supportive of the push for greater gender equality on boards, the Davies review expresses a degree of disappointment with the overall level of engagement from investors. It asks them to use their collective voice to greater effect and to establish their own best practice guidelines aimed at improving the gender balance on FTSE boards.

Talent pool. 22% of the new female directors had not previously had any listed board experience. 56% of them are classified as plural; that is, they hold no current full-time executive role but engage in a portfolio of non-executive activities. The majority of these plural women work across a variety of sectors, such as private, not-for-profit, government or academic roles. The Davies review comments that, while the pool of talent has been widened to embrace women in professional services roles, those from other backgrounds have not been considered to any great extent.

Although the specific 25% target has been reached, that is not the end of the story. The Davies review emphasises that further work and a renewed focus is required, particularly with regard to boosting the number of women appointed to chair boards and as senior independent directors, as well as to executive director roles and in the executive management layer immediately below the board.

Other countries that have introduced quotas for women board appointments have set their goals higher than the 25% target in the UK. For example, the target in France and Norway is 40% and in Belgium and Italy is 33%. The Davies review warns that if the UK does not progress beyond the current 26% level, it will fall behind European and other countries in the near future. The introduction of an EU directive setting a voluntary target of 40% women non-executive directors by 2020, backed up by an obligation on companies that fall short of that target to appoint a woman candidate where a male candidate and a female candidate are equally qualified, is due to be prioritised in 2016.

The Davies review therefore makes the following five next step recommendations:

For an analysis by Practical Law What's Market of the progress made by FTSE 100 companies in achieving the voluntary target of at least 25% female board representation, see article "Women on boards: where are we now?".