More ethnic diversity in UK’s largest businesses but still work to do

More people from ethnic minority backgrounds are heading the UK’s biggest companies but more needs to be done to improve representation, according to authoritative analysis of company directors, chief executives and senior management.

The 350 most valuable companies on the London Stock Exchange were looked at as well as data from 36 of the 50 largest UK companies not listed on the stock exchange.

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The review, conducted by an independent review body, the Parker Review Committee, and the Department of Business and Trade, found 96 of the 100 most valuable companies of the Financial Times Stock Exchange (FTSE) 100 had at least one director with an ethnic minority background on their boards.

While that figure was the same in 2023 as 2022 there was an increase in the number of CEOs from ethnic minority backgrounds in the FTSE 100, up from seven in 2022 to 12 last year.

Directors are key members of company boards who oversee the management of the business, while chief executives are typically the highest ranking member of a board.

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Are boardrooms diverse enough?

Increases were also recorded in the number of chairs from ethnic minority backgrounds, up from six to seven – though the overall number of chair and executive director positions held by people from ethnic minority backgrounds remained at 31.

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The number of companies with more than one ethnic minority director in the FTSE 100 grew from 49 in 2022 to 56 in 2023.

The vast majority (79%) of the 222 companies in the bigger FTSE 250 index who responded said they met the target of appointing at least one ethnic minority director, up from 67% in 2022.

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For the first time proper data on the ethnic background on senior management in FTSE 100 companies was collated, showing 13% of FTSE 100 and 12% of FTSE 250 are from ethnic minority backgrounds.

Senior management roles include the chief financial officer and chief information officer.

Though progress is welcome, the review said, much more needs to be done to reach the December goal for FTSE 250 firms to have at least one director on their board from an ethnic minority background.

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Within the largest private companies (rather than publicly listed entities) 36 of the 50 provided data with 22 saying they had an ethnic minority director on the board. These businesses had been set a deadline of 2027 to hit the target.