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High-growth start-ups worse than FTSE 100 for gender diversity

sexismThe start-up sector is worse for female representation at board level than the FTSE 100 firms, new research reveals. The UK’s fastest growing new companies are a sea of male suits. Gender diversity, such as it is, has been getting progressively worse since 2010.

The UK index of the fastest growing companies, the Fast Track 100, compiled by the Sunday Times, includes a meagre 8.37% female directors, according to the new research by business to business services marketplace, Approved Index.

The report highlights the growing gap between gender diversity in the leadership of PLCs and private businesses. Since 2010 the gap between the FTSE 100 companies and start-ups has quadrupled. The FTSE 100 and FTSE 250 companies have witnessed incredible growth in female directors (22.8% and 15.6% respectively), driven by both the threat of potential legislation on the one hand and mounting evidence of the bottom line business benefits of gender diversity on the other.

The evidence is now clear that increasing the number of women on corporate boards improves performance, increases innovation, helps mitigate risk and keeps businesses in touch with their customer base. A Credit Suisse analysis of 2,400 companies found that diverse boards earned higher returns for their investors. Thomson Reuters research warns that firms with entirely male boards are also likely to be more volatile.

Trilby Rajna, of Approved Index said: “ It seems that despite start-up firms being heralded as the pioneers for innovation and technological advances, the inherent culture is far from progressive.”

The UK’s entrepreneurial performance is being held back by poor conditions for female entrepreneurship according to the Global Entrepreneurship and Development Index. We need to do much better in supporting women into management roles and science and technology careers. In the meantime, companies that care about their bottom line and long-term prospects need to reach out, recruit more creatively and make more of an effort to ensure their boards are diverse.

Female start-ups infographic

Image: sexism via Shutterstock

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