However she expressed concern that a third of Britain's leading companies still have no women on their board according to figures published today.
According to the Female FTSE Report 2004, published today by Cranfield School of Management and sponsored by the DTI and Shell, good progress has been made in many companies, but women are still under-represented in corporate Britain.
The report's other main findings are that:
- 17% of new FTSE 100 board appointments have been women this year, up from 13% last year and 10.5% in 2002.
- The total number of female directorships in the FTSE100 is 110, up from 101 last year.
- The number of boards with more than one female member has risen from 22 to 29 this year.
- But 31 of the FTSE 100 companies are run by men-only boards.
- Of the new women appointed in 2004 33% already had FTSE experience and incoming non-executive directors are also far more likely than the directors they replace to have public or voluntary sector experience.
Patricia Hewitt said:
"It's very good news that almost 1 in 5 new board appointments have gone to women, up from just 1 in 10 just two years ago, but we still have much further to go.
"It's not about putting women on boards for the sake of it - we want companies to promote the best people for the job, but with almost a third of companies without a single woman on the board, my concern is that companies are not drawing from all the available talent."
Ms. Hewitt announced that the Government itself would examine its own record on senior appointments to ensure its recruitment policies were drawing on a widest range of talent.
Ms. Hewitt said:
"Just as businesses should cast their net widely to get the best people into their boards, so should the Government. We want to lead by example, so I am announcing today that Government headhunters, who recruit for most of the 4,000 vacancies a year across Government, will have a new requirement to present more diverse fields of candidates."
Professor Susan Vinnicombe, the author of the Female FTSE report 2004, said:
"The UK is taking a unique position in the world in the way it is endeavouring to modernise its top 100 boardrooms without resorting to legislation or quota systems. We see Government, chairmen, existing women directors, academics and others working together in innovative ways to create momentum."
Ms Hewitt was speaking as she published "Building Better Boards", a best practice guide produced with businesses, which offers recommendations and tools to help companies improve recruitment and performance in the boardroom.
"Building Better Boards" builds on the recommendations of Derek Higgs and Laura Tyson for more diverse and effective boardrooms. The new guide:
- sets out the business case for effective diversity and better practices in the boardroom;
- cites the benefits for companies, with evidence from some of Britain's best-known businesses and names; and
- outlines Government and business-led initiatives to develop the talent pool of women.
Ms. Hewitt said:
"The Government has a clear role to play in encouraging good governance, but the main response has to come from directors and investors themselves."
"Our best companies work proactively to recruit from more diverse sources and to improve their boardroom practices.
"Building Better Boards" sets out the steps that the Government and some of our leading firms see as vital to better corporate governance.
"In the UK we have an effective corporate governance framework we can be proud of, but there is no room for complacency. We have already acted on directors' liability, to remove the disincentives to high quality people joining company boards and we have also given shareholders greater power and the information they need to monitor companies' performance.
Miles Templeman, Director General, Institute of Directors, said:
"In recruiting to the board, companies should have the confidence to look at candidates from a wide range of backgrounds and not just those who have come through the 'traditional' route. At the end of the day, companies need to be open-minded in looking for those people who can add value to the board.
Digby Jones, Director General of CBI, said:
"It is important that boards, beside having the right skills, reflect their organisations, their customers and the communities they serve as well as possible. That means achieving active, non-tokenist and competent diversity".
