Bank in the UK and Europe have the largest proportion of female board members; whilst US, China, and Japan lag behind.

The UK’s biggest banks have hit their targets for the representation of women on their boards, but bank boards globally are lagging behind, according to financial services recruitment firm Astbury Marsden.

The percentage of women board members in the UK’s biggest banks has risen significantly, up from 19% three years ago to 31% today. However, the drive to ensure better representation of women has not been reflected globally, with women making up less than a quarter of boards of the world’s largest 30 banks (by assets). 

Europe’s banks have the highest proportion of women board members at 35% compared to the global average of 22%. However, the growth in the representation of women on continental European boards has been slower than that on UK banking boards, rising from 26% in 2012 to 35% in 2015. 

Other countries such as China and the US have experienced a decrease in the number of women on their bank boards.

Astbury Marsden stated that the rise in the number of women on UK boards has come after a voluntary target was set by Lord Davies. He recommended that FTSE 100 companies should have at least 25% of women at board level by 2015. 

Adam Jackson, Managing Director at Astbury Marsden, commented: “[Lord Davies’] ‘Women on Boards’ initiative has encouraged all FTSE 100 companies to have a greater representation of women on their boards, but with all the public and political focus there has been on the banking sector, it has been under particular pressure to diversify.”

“For a long time banks were seen as an ‘old boys club’ but these statistics suggest that this mentality is changing. With 31% of board members in the UK’s biggest banks now women, women are finally breaking through the glass ceiling. But the biggest banks outside Europe are lagging far behind,” he added.

Astbury Marsden points out that other countries such as Japan and the US have had less pressure to diversify and have much smaller percentages of board members who are women. The boards of the USA’s top banks have just 23% female members and Japan’s only 7%. Two of Japan’s largest banks (by assets) have no women on their boards at all. 

China, a country which had previously performed well with women representing 21% of banking directorship in 2012, has fallen behind. Just 16% of the board members of China’s biggest banks are women. 

Astbury Marsden stated that many of the larger Chinese banks began as State Owned Enterprises and, therefore, might be expected to adhere more closely to a policy of equal opportunity than those in the private sector. However, the decrease in board members who are women might indicate an easing of government pressure on this issue. 

The big global investment banks fall noticeably behind commercial and diversified banks in terms of the number of women at the most senior level. Just 16% of board members of investment banks are women. 

Astbury Marsden said that often women find it easier to progress within retail or commercial banking than in investment banking. 

This could be due to the long working hour culture in investment banks and alienating trading floor environments. However, the relative lack of women may also reflect the underrepresentation of women across investment banks’ customer base at the leadership level of major corporates and asset managers. 

Mr Jackson added: “It’s important that the best people are hired to the board, not due to their gender but because they have the best skills and experience for the job. However, there is an argument that diversity is in itself desirable and that women can provide a different mind-set and approach to risk than men.”

“Whether this theory holds true, it’s generally accepted now that boards do need more women, not least because it helps to attract and develop the best talent at all levels. Having more women on boards will help encourage female talent. Junior staff are bound to look up to women such as Gay Huey Evans, director at Standard Chartered, who are evidence that it is worth striving to reach the very top.”

“Huge efforts have been made within the banks to mentor female talent and make sure they’re making full use of executive training. It’s clear that in the UK these efforts are paying off,” Mr Jackson concluded.