Almost a fifth of FTSE 100 boards have no ethnic minority members

Almost a fifth of FTSE 100 boards lack any ethnic minority representation, with less than a year to hit a key target of at least one non-white director, according to a government-backed review into corporate diversity.

The review, chaired by Sir John Parker, said significant progress had been made in the past year towards the “one by 2021” target, with about 80 per cent of FTSE 100 boards this month reporting at least one director from a minority ethnic group. This compared with 52 companies in January last year.

But 19 companies still lack any board-level ethnic minority representation, with just five non-white FTSE 100 chief executives, one fewer than last year. There are also only two non-white chairs and four in a chief financial officer role.

Companies without any ethnic diversity on their boards include the London Stock Exchange, investment group M&G, housebuilder Persimmon, retailer JD Sports and British Airways owner International Airlines Group.

Shareholders are becoming increasingly vocal in demanding boardroom diversity. Legal and General Investment Management in October wrote to nominations committee chairs in the FTSE 100 warning that it would vote against their reappointment if they fail to meet expectations on ethnic diversity.

FTSE 350 companies that fail either to disclose the ethnic diversity of their board or provide a “credible action plan” to achieve the Parker review targets will this year be handed an “amber top” alert by the Investment Association, indicating a significant issue for investors to consider.

The Parker review found that 124 of the 998 board positions across FTSE 100 companies are held by ethnic minority directors, up from 95 in 2020. But only a third identify as British citizens, and about a tenth sit on two or more FTSE boards.

When the Parker review first reported in 2017, more than half of FTSE 100 boards were all white.

FTSE 250 companies have until 2024 to appoint at least one ethnic minority director on their boards.

Parker said: “This survey of FTSE 100 companies represents significant progress towards the target. We would hope the remaining companies in the FTSE 100 will ensure they follow this encouraging lead and align with the business case that underpins the review.”

The review is based on voluntary data submissions, with five companies either not responding or saying that they were unable to provide information.

Kwasi Kwarteng, business secretary, said the progress highlighted by the review was “very promising, particularly given the difficult circumstances businesses have been facing”.

He added: “FTSE companies are seeing the benefits of diverse leadership teams first-hand as we build back better from the pandemic. We hope more companies harness this momentum to go further and faster to ensure our boardrooms are fully representative of British society.”