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Vince Cable Backs All-Women Shortlists for FTSE Boards

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Last Updated: Oct 4, 2016

Women could soon be forced to occupy FTSE 100 companies that are looking to recruit for senior posts in an effort to increase the number of females holding top offices, under a plan being considered to be introduced by the government.

Vince Cable, the Business Secretary, has supported the recommendation which could see the headhunters come up with women-only shortlists for board-level positions by completely eliminating men from the recruitment process.

Currently, all-women shortlists are not used in the private sector because they are fraught with legal challenges and give room for gender discrimination claims from men who are left out in the recruitment process.

But Mr. Cable has requested the UK’s equality body, the Equalities and Human Rights Commission, to give guidelines for headhunters on when and how women-only shortlists can come in to effect without breaking the law and free from threats of legal cases. In reference to a source close to the Department for Business, the government is yet to rule out the possibility of adjusting the law to introduce all-women shortlists legally, “without grey areas”.

The move rose after a review of the headhunting process, led by Nomura, former head of diversity, Charlotte Sweeney and commissioned by Mr. Cable, crafted recommendations for women to hold top job positions.

At the moment, 20% of all FTSE 100 posts are held by women, which marks an increase compared to 12.5% in 2011.

The Business Secretary also backed other proposals including headhunters putting at least one woman on the shortlist surrendered to chairman, making public the male-female ratio in all recruitment phases and establishing a database of “board-ready” women to hire from.

According to employment experts, all-women shortlists are illegal unless the companies demonstrate in a court of law that there are no men who merit for such positions – something seeming impossible.

In the meantime, a former FTSE 100 chairman who spoke on condition of anonymity questioned whether the plan will work after all. He added that women won’t be appointed on merit and thus their appointment would appear tokenistic noting that it might set women up for failure.

While speaking after the review of FTSE 100, Mr. Cable said that the headhunting community is an important catalyst to introduce more capable women in the boardroom. He welcomed any efforts to improve the industry’s transparency noting that it can be one of the first hurdles that talented, board-ready women might face while going for top positions.

Chief executive of the Recruitment and Employment Confederation, Kevin Green, stated that it was firm’s responsibility to challenge and probe employer’s assumptions in an effort to ensure that businesses include top female talent.

Nevertheless, he insisted on the need for openness and transparency as a way of highlighting the positive role of headhunters in helping firms to secure the talent they need to perk up performance.

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