Babcock International Group PLC is a FTSE250 company and a global player in engineering-related services. My thanks to Jason for alerting me to the following excerpt from their last (2011) Annual Report:
Board Diversity We recognise the value to the effectiveness of boards and board committees of their being able to draw upon a diverse range of skills, experience and outlook from amongst their members so as to bring a wide range of perspectives to the oversight of company strategy, risk mitigation and management performance. In order to achieve long-term success in a competitive international environment, companies need to draw upon a diverse range of perspectives and competences that are relevant in that environment. .As Babcock grows in size and complexity and increases its activities around the world this is likely to become even more important. Diversity in this respect is very much about the personal approach, qualities and experience of individual directors and not about simply who or what they are.
We note the views of Lord Davies in his Review into Women on Boards published earlier this year as to increasing gender diversity on boards and in senior management roles. We recognise that gender, like other attributes and experience, can contribute to the diversity of perspective that we seek and that in selecting for board appointments this is something of which we need to be, and are, conscious. That said, our overriding criterion for appointment must always be merit and the best candidate for the role.
We, like others, are sceptical of quotas for the numbers of women (or any other persons based on group characteristics) on boards or in other senior management roles as they do not necessarily deliver the individuals with the best skill set or experience and can lead to tokenism. We note that Lord Davies’ review does not set quotas as such, but encourages companies to state their aspirations as to the numbers of women on their boards and that his report (and others) recommend specific targets to be aspired to by certain dates. We understand the good intent and motivation behind this, but believe that stated aspirations as to targets of this kind can easily become self-imposed quotas. They also inadequately allow for the fact that companies in different sectors have different challenges in this respect. The traditional engineering sector in which Babcock primarily operates is inevitably going to find that it is more challenging and will take longer to find women candidates with the right experience and background to move into senior management roles and board positions than those operating in some other sectors.