Our mission is to create competitive edge by building diverse top teams. In order to work for it and for our clients' benefit, we want to understand and stay updated fact-based what is going on in Finnish companied in terms of diversity and equality. Especially the topic is interesting due to European Union directive which will govern the requirements in board gender diversity.
Legislation will concern only biggest publicly listed companies, but diversity is equally important source for competitive advantage to companies of any size. Therefore we have analyzed the situation in all (expect First North) Finnish publicly listed companies' boards and group leadership teams.
The outcome is not yet very encouraging. Only 27 % of companies meet the 40 % criteria of gender diversity in their board compositions. The amount of women members is stagnated to 32 % when comparing 2023 and 2024 board nominations.
One of the biggest bottle necks lies in leadership teams, where only 26 % of position holders are female leaders. 83 % of companies do not yet meet the 40 % diversity milestone, and 22 companies do not have a single female leader in their top leadership team.
When diving deeper to understand challenge better, we see a significant discrepancy on the profiles preferred in the boards and the representation of profiles in top leadership teams. Majority of leaders in boards have business or finance background regardless of their gender, almost 70 % of 283 women in boards having background either or. On the contrary to only 19 % of all 261 women in leadership team members holding such positions.
Something needs to be done differently;
Board succession planning: To further enhance the recruitment processes for board positions by ensuring transparent selection criteria, balanced, diverse lists of candidates, and building courage to think more out-of-the-box about profiles
Operative talent management: to create specific talent management and succession planning programs for female leaders in every ladder of career track, having focus and measures to create more balance pipelines to P/L positions.
So, there is still a mile to run. When looking at any research about benefits of diversity in top teams, for example McKinsey has found out (12/23 Diversity matters even more), that companies with diverse top teams have 39 % higher probability to exceed performance of their competitors.
It is definitely worth of running that last mile!