A few months after Lloyds Banking Group made history by becoming the first firm within the FTSE 100 to “set a formal target to improve ethnic diversity among its top executives”, Legal & General Investment Management (LGIM) is pushing British firms to increase women on boards. LGIM is “one of Europe’s biggest asset managers” and the funding “arm of insurer Legal & General (LGEN.L), which manages nearly 1 trillion pounds ($1.4 trillion) in assets.”
Last month, the asset management company wrote to top executives calling for more support of women, parity among gender pay and business goals that reflect environment friendly solutions. This new lead has been noticed by many and is now expected to be furthered through upcoming votes from LGIM. To put it plainly, “LGIM said it would vote against British companies where women did not represent at least a quarter of the board, and wanted a full breakdown of any gender pay gap and plans to close it.”
LGIM, whose parent company Legal & General has a board which is 30% female, has been backed by the Investment Association, the industry’s trade body “which said it had written a separate letter to 35 FTSE 350 companies that it had singled out, calling on them to improve boardroom gender diversity.”
“The body of research is clear: firms with a diverse management team and pipeline make better decisions and drive innovation,” the Investment Association’s Chief Executive Chris Cummings said. The association’s members manage nearly 7 trillion pounds in assets out of Britain.
This new mandate comes at a time when the push for increased board room diversity is taking on global implications. We will see where this leads but expect this uptick in support to continue.