By Kristy Dorsey

Gender parity in the UK’s largest quoted companies has been set back by four years since the onset of the Covid pandemic, according to new research out today.

Men still account for 85 per cent of all executives on the main boards of FTSE 350 companies, according to the latest annual analysis by The Pipeline’s Women Count report, with the rate of female appointments “slowing rapidly” in 2021. At executive committee level, men account for 78% of all roles, with 2020’s increase of 2.7% of appointments going to women falling to 2.5% in 2021.

As a result, Women Count has pushed back the expected date for gender parity at executive committee level to 2036, four years later than last year’s assessment.

Following a “devastating 15 months” for businesses, this year’s report also examined the profitability of firms based on gender diversity.

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In those where women make up at least half of the executive committee, firms secured an average profit margin of 21.1%. In contrast, those without any female representation suffered an average 17.5% fall in profits.

According to Women Count, an additional £123 billion in pre-tax profit is therefore available if companies where women make up less than a third of the executive committee performed as well as those with 33% or more women.

The report comes amid widespread discussion about the disproportionate impact Covid has had on women’s representation and earning power in the workplace. Earlier this year, PwC’s Women in Work Index predicted that women’s economic progress will decline for the first time in a decade, returning to 2017 levels based on a range of factors such as the gender pay gap and lopsided increases in female unemployment.

Lorna Fitzsimons, co-founder of The Pipeline, said various initiatives during the past decade or more have failed to significantly move the dial on improving executive gender diversity. That progress is now stalling and in some cases reversing from those “scandalously low” rates is something the post-Covid economy can ill afford.

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“The last year has been dominated by Covid-19, which has disrupted so much,” Mr Fitzsimons said. “Times of crisis are moments that offer the possibility of major shifts away from established paradigms, but the extreme stresses involved can also drive a response that is regressive.

“The data in Women Count 2021 reveals that FTSE 350 companies have not used the pandemic as a transformative moment for their businesses, instead there has been a reversion to type with companies continuing to fail women.”

With women accounting for only 5% of all chief executives in the FTSE 350, the report concluded that “almost every major PLC is failing to make progress on gender diversity at the top”. Furthermore, the post of chief financial officer is also overwhelmingly dominated by men, with women accounting for just 17% of these positions.

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Diving further into those figures, Women Count concluded that females remain largely excluded from the wider pool of key profit and loss (P&L) roles that pave the way to reaching the top rungs of management.

Nearly nine out of 10 executive committee P&L roles available are filled by men, with women accounting for just 11% of these positions. The majority of FTSE 350 companies – 59% – do not have a single woman on the executive committee with P&L responsibility, yet every company has at least one man with profit and loss accountability.

Noting the closing remarks by Joe Biden at the G7 summit earlier this year, in which the US president put gender equality among the group’s four key priorities, Ms Fitzsimons described the summit as a “kick up the bum” for firms to act on the diversity agenda. As a first step, Women Count is calling for all FTSE 350 companies to put their human resource chiefs on the main board of directors.

“Companies know how to [improve female representation],” she said. “We know what works, but companies need to decide whether they want this done to them by regulation, or if they want to be proactive.”