Mid-sized UK businesses are slow to boost ethnic diversity on their boards, a new race representation report has found.

The government-backed Parker Review showed that while “significant progress” had been made, nearly one in five of FTSE 250 companies had not made improvements.

A total of 46 firms – which had a December 2024 deadline to appoint one or more ethnic minority director – ignored the survey or still had all-white boardrooms.

David Tyler, former Sainsbury’s chairman and current review committee chair, noted that the shortfall of some FTSE 250 companies in meeting the target is partly due to the number of investment trusts in the index, which often lack or have few senior managers. In general, he believes “it’s very much moving in the right direction”.

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Five FTSE 100 companies, including Hargreaves Lansdown, Persimmon and United Utilities, failed to appoint an ethnic minority director.

Ethnic minorities account for 11% of senior management in the FTSE 100 and 9% in the FTSE 250, falling short of the 17% in England and Wales.

Jonathan Reynolds, business and trade secretary, said: “The latest Report highlights significant progress: With the date of the 2024 voluntary target for FTSE 250 companies being reached this year, it is incredibly encouraging to see a 17% increase in the number of companies meeting that target compared to last year. This progress is a testament to the collective efforts of all stakeholders involved.”

Urging firms to follow the insights and recommendations set out in the guide, he said they could help organisations “cultivate a culture of inclusivity that empowers employees, drives growth, and ultimately, contributes to a more equitable society”.

He added: “Let us continue to build on this momentum, striving for a future where diversity is celebrated, and every individual has the opportunity to succeed.”

Established in 2015 and first chaired by Sir John Parker, the Parker review committee was tasked by the government with recommending ways to increase minority representation in senior British business roles. Its goal was to enhance business performance by utilising all talents, minimising the risk of group-think and ensuring equal opportunities for ethnic minorities.

At the time of its launch, more than half of FTSE 100 boards were entirely white.

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In 2023, the review asked FTSE 100 and FTSE 250 firms to set their own 2027 diversity targets. FTSE 100 companies aimed for 15% ethnic minority representation, and FTSE 250 aimed for 13%.

 

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