A REPORT by the Pension and Lifetime Savings Association (PLSA) Diversity and Inclusion points to a lack of trustee board diversity in the UK.
It found that 83 percent of scheme trustees are male, 25 percent of schemes have all-male trustee boards, and 50 percent of chairs of trustee boards are over 60.
By comparison, 32.1 percent of FTSE100 board members are female, and 7.4 percent of board members are BAME, including 3.3 percent in the most senior positions.
According to McKinsey’s 2018 Delivering through Diversity report, there’s a strong business case for increasing diversity. Companies in the top quartile for gender diversity on executive teams were 21 percent more likely to have above-average profitability than companies in the fourth quartile. For ethnic/cultural diversity, top-quartile companies were 33 percent more likely to outperform on profitability.
Amanda Latham of Barnett Waddingham said the lack of diversity in boardrooms goes beyond the FTSE100. “Pension schemes are falling behind when it comes to trustee board diversity,” she said. “Yet they have the same corporate, professional, and personal responsibility to make decisions that will improve outcomes for their members. Inequalities are increasing in the UK, with some groups, like working mothers, disproportionately impacted by job insecurity, reduced hours or pay as a result of the pandemic.
“Improving the diversity of trustee boards can help address inequalities, limit unconscious bias and enable consideration of different experiences, such as caring responsibilities or family structures.
“But it’s clear that there are significant blind spots when it comes to understanding the relationship between performance and diversity, and the benefits in prioritising diversity and inclusion.
“If we’re serious about making change on pension boards, we should be following the lead of the corporate sector, setting measurable diversity targets. There’s no time to waste.”