Two U.K. banks go public about getting more women at the top


EPA/ANDY RAIN

When U.K. bank Barclays announced its 2013 annual results on Feb. 11, much of the news focused on the bank's plan to cut up to 12,000 jobs this year and the decision to boost its bonus pool to $3.9 billion despite sharply lower profits.

But amid those punishing headlines, the bank also announced something unusual: the ratio of women it aims to have among its senior leadership ranks by the year 2018.

In four years, Barclays says 26 percent of its roughly 2,000 senior leaders should be women, up from the current 21 percent. The announcement came two weeks after Lloyds Banking Group, another U.K. bank which has been embroiled in a scandal over sales practices, announced that it intends to increase its number of women in senior management roles from 27 percent currently to 40 percent by 2020.

Whatever the reputation benefits — and setting aside whether 26 percent or 40 percent are even the right goals — the disclosures are notable for their rarity. "I’m not aware of any other organization, globally, that has gone externally public with aspirational goals around diversity," says Valerie Germain, a managing partner at Heidrick & Struggles, the executive search firm.

Though some companies already set in-house goals for how many women they want in top jobs, few ever announce them to the world. Deborah Soon, who heads up strategy and marketing for the nonprofit research firm Catalyst, says such internal goals can still have real teeth in them. "People's compensation might be tied to the performance against those diversity goals, so they can be very explicit internally," Soon says. "But to the best of my knowledge I'm not aware of any companies in the U.S. who've [shared targets] publicly."

The moves by Barclays and Lloyds come amid a global debate over whether or not countries should set quotas for the number of women in the boardroom. (Women currently make up about 20 percent for the top 100 public companies in the U.K., while 16.9 percent of board seats at the largest 500 U.S. firms belong to women.) Several countries, including Norway and France, have passed laws requiring a certain percentage of female directors. In the United Kingdom, a 2011 report commissioned by the U.K. government recommended — but didn't mandate — that the 350 largest public companies have a quarter of board seats allocated to women by 2015.

In the executive ranks, there's little talk of quotas, but some believe a more public spotlight on how many women are actually in senior management could shame companies into raising the bar. (Currently, women hold 15.3 percent of executive roles in the U.K.; in the United States, it's 14.6 percent.)

The same 2011 report recommended that CEOs in the top 350 companies in Britain also set gender targets for their executives, though few companies followed through, says Helena Morrissey, founder of the 30% Club, a U.K.-based organization promoting boardroom diversity. "Something like 2 out of the 350 actually came out with a numeric target in the timeframe suggested."

Maggie Wilderotter, the CEO of Connecticut-based Frontier Communications, said in December that a public-private partnership that sets voluntary gender-parity targets and tracks how well companies meet them could help speed up the pace of change. “In the world of business,” Wilderotter said at the time, “we all care about measurements. We’re competitive about those measurements."

That's why Lloyds' director of diversity, Fiona Cannon, says the bank decided to go public with its goals. "It allows other people independently to measure our progress, but also provides a really strong focus internally,"she says. "This moves us into business as usual, so we have the same rigor and discipline as we would with any other business issue."

At Lloyds, the bank is aiming for women to make up 40 percent of its top 8,000 positions, which includes everything from senior executives down to positions such as department heads. The bank has not said the 40 percent target will be proportional across the ranks of management, so it may be longer before the very pinnacle of the bank's executive suite is 40 percent female. "For us, it’s about building the pipeline, so we have to start farther back," Cannon says.

Will more companies follow suit and publicly disclose not only how many women they have in management, but how many women they want in those senior jobs down the road? Heidrick's Germain thinks so. "I expect we’ll see more of this over time, not just in countries that have contemplated quotas like the U.K. but in countries like the U.S.," she says. 

Meanwhile, others think gender targets will be important not only as an alternative to potential quotas, but to help grease the skids on a problem that seems utterly stalled. "The thing I struggle with on quotas," says Sharon Thorne, a U.K.-based managing partner at the professional services firm Deloitte, "is that it implies positive discrimination. I think having targets actually is essential. It’s absolutely true that what gets measured gets done."

For Lloyds and Barclays, at least, the world will know in a few years if that wisdom actually holds true.

Jena McGregor is a columnist for On Leadership.

Read also:

Where is the female executive?

Changing our image of women, one stock photo at a time

New bonus structure at Barclays includes points for good "citizenship"

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Jena McGregor writes a daily column analyzing leadership in the news for the Washington Post’s On Leadership section.
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