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Female board representation doubles in a decade

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The last decade has seen a consistent increase in the number of female faces in boardrooms across the (re)insurance industry – but a considerable majority of companies are still some distance away from parity.

Insurance Insider’s analysis of data provided by sister company BoardEx for a cohort of 81 large and listed carriers and brokers has shown that, as of last month, female directors make up 50% or more of the board at only five of those firms.

In aggregate, the proportion of board seats occupied by female directors more than doubled between January 2012 and January 2021 from 12% to 28%.

And, so far in 2021, that share has continued to increase: as of 12 October, the average insurance boardroom was made up of approximately four female and nine male directors.

The majority of this change, however, has been affected on the non-executive side.

While the proportion of male non-executive directors across this group of companies had fallen to 67% at the start of last month, the equivalent proportion of executive directors remained much higher at 85%.

One of the factors contributing to this disparity is clear.

Whereas companies were able to increase the number of non-executive directors on their boards over the last decade (from an average of 9.6 in January 2012 to 10.2 in October 2021), there was no such growth in the average size of the executive director class (which was 2.0 at both dates).

At an individual company level, only 12 of the 81 companies analysed increased the number of spots available for executive directors in their boardrooms, while 43 were able to increase the total number of non-executive directors.

On average, those 43 companies were able to add 2.3 female non-executives each over the course of the decade. In contrast, the other 38 in this cohort – which did not increase their numbers of non-executive seats – added only 1.6 female directors to their boards.

These findings come as the (re)insurance industry continues to push for gender parity at both the grassroots and leadership level. While progress has been made on this front, many in the market are still of the belief that the industry is not going far enough to attract and retain female professionals.

A clear geographical split is also evident in the data, with companies in Europe making changes to the composition of their boardrooms much faster than their counterparts in the USA – despite sitting at effectively the same level in 2012.

During the 2010s, governments in a number of European countries (Austria, Belgium, France, Germany and Italy) joined Norway in legally mandating boardroom gender diversity quotas.

These decisions appear to have had an impact on this observed trend in the BoardEx data, which is disaggregated by sex rather than gender – a classification that we have maintained in our analysis.

At companies analysed in these five countries, female directors held only one in 10.6 board seats in January 2012. By October of this year, they held one in every 2.8.

Meanwhile, in the UK, earlier this year the Financial Conduct Authority proposed new rules mandating listed firms to have 40% of senior board roles filled by women on a “comply or explain” basis.

Of the four UK-domiciled companies analysed, three – Aviva, Beazley and Admiral – already meet this benchmark, with Willis Towers Watson having only three women out of its total of nine directors.

The Lloyd’s market is excluded from this BoardEx data analysis, but its most recent culture dashboard showed that female representation at board level increased by seven percentage points year on year to 19% in 2021, while at executive level, female representation increased by six points to 24%.

Lloyd’s has set a target of 35% for female representation in leadership positions. At present, across the market, that figure is 29%, but 16 out of the 58 firms that provided data have already hit the target.

The Corporation has reached gender parity – between 45% and 55% female representation – among its own senior leadership, of whom 46% are female.

Also evident from the chart above is the fact that companies in the US have now fallen behind their Bermudian rivals.

Between them, the 11 companies headquartered on the island which were included in this publication’s analysis had only six female board members out of a total of 105 on 5 January 2012.

By 12 October 2021, this figure had risen to 32 out of a total of 113.

And female directors now make up more than 30% of the board at five Bermuda-domiciled companies: Axis, Assured Guaranty, RenaissanceRe, Lancashire and Hiscox.

For context, in 2012, Lancashire – with one female director out of nine in total – had the highest proportion of any Bermudian company.

Bermuda has seen this progress take place without the enforcement of sex or gender quotas – an approach favoured by the 30% Club, an organisation with the stated objective of reaching “at least 30% representation of all women on all boards and C-suites globally”.

It began as a campaign in 2010 to boost the number of women on FTSE 100 boards in the UK but has since expanded its focus.

It sees its 30% target as “a floor not a ceiling” and settled on the figure after identifying research suggesting that 30% represents a “critical mass from which point minority groups can impact boardroom dynamics".

Where only five of the cohort of 81 companies analysed had reached this statistical benchmark with respect to female board members at the start of 2012, as of last month 43 had done so.

More starkly, however, only 13 companies had reached a 40% threshold, and only five – Axa and Scor in France, Zurich in Switzerland, Admiral in the UK and Progressive in the USA – a 50% threshold.

For all the evidence of progress over the last decade, those figures are a reminder that there is a significant way left for the industry to travel.

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