Strategy & Operations » Governance » Drop in leading female CFOs raises concerns

A ten year rising trend in the number of FTSE 100 female CFOs has come to an end with a fall in the last few months.

According to research undertaken by Financial Director, confirmed by headhunters Egon Zehnder, only ten firms in the elite group of UK listed companies feature female finance chiefs, down from 12 last year.

The 17 per cent fall will be a massive blow to government-backed efforts to deliver boardroom diversity. At the same time there are growing concerns that gender pay gaps in many organisations are being distorted by a high proportion of well-paid senior roles being dominated by men.

It will also provoke questions from equality campaigners as to whether large corporates and major accountancy firms are doing enough to support women into top finance positions.

Over the last decade, the number of female FTSE 100 CFOs grew from just one to 12 by 2017, the highest number recorded in the Cranfield School of Management’s Female FTSE Index.

But in recent months Helen Weir, the former CFO of retailer Marks & Spencer, and equipment rental group Ashtead’s previous CFO Suzanne Wood have been replaced by male colleagues, and Merlin Entertainments – where Anne-Francoise Nesmes is CFO- was ejected from the FTSE 100 at the end of last year.

Only the promotion of Penny James to the top finance role at insurer Direct Line last March offset what would have been an even more dramatic picture. James is the only female CFO to be appointed to a FTSE 100 company since housebuilder Barratt Developments promoted Jessica White to CFO in June 2017.

Although there hasn’t been a formal investigation into the shortfall in female FTSE 100 CFOs, there has been a growing desire to improve the situation. In September 2014, Egon Zehnder’s CFO practice announced it’s 25 by 25 initiative to get women to occupy a quarter of top flight finance roles within a decade.

Accountancy giant PwC, one of the Big Four firms which many top CFOs gravitate from, has just announced it will no longer run all-male shortlists for roles.

An attempt to develop wider boardroom diversity has resulted in significant improvements- there are very few FTSE 100 boards without some form of female representation.

Campaigning by the 30% Club, led by Dame Helena Morrissey (now Head of Personal Investing at insurer Legal & General), to achieve an aim of a third of all FTSE 100 board positions held by women is moving closer to that target.

But the limited number of executive roles on top boards filled by women in that time has raised questions as to whether a quota system for C-suite roles, such as the approach taken by Norway, should be imposed in the UK.

In the meantime, the government-commissioned Hampton-Alexander Review has said FTSE 350 companies should aim to fill at least a third of their boardroom positions with women by 2020 and has urged them to submit their gender data by the end of June.