Behind the mission to triple the number of female CEOs by 2025

Tara Cemlyn-Jones is a woman on a mission. The former investment banker wants to help almost triple the number of female CEOs in Britain’s largest companies – and fast.

A quarter of a century ago, Dame Marjorie Scardino was appointed CEO of media company Pearson, making her the first female CEO in the FTSE 100. Today, nine women run the country’s 100 largest public companies. Cemlyn-Jones wants it to be 25 in total by 2025.

She is not alone. Under the umbrella of the 25×25 Initiative, a nonprofit she founded in March 2020, she is supported by a dozen world-class companies including GSK, NatWest and Unilever.

Cemlyn-Jones argues that diversity among CEOs, as the “public face” of companies, is immensely important in setting expectations and articulating aspirations. If corporate leaders “look all male — or white, or straight, or able-bodied — you’re not going to attract the widest array of talent,” she says.

The 25×25 campaign is as much about building the business case for change as it is about ensuring fairness. Studies consistently show that diversity in leadership teams has a positive impact on long-term profitability. For example, an October 2021 study by US financial services firm Morningstar found that shares in UK and North American companies with an equal gender distribution at board level achieved a 7.52% return on investment over three years, compared to an average of 2.09%. .

Improve diversity and reduce groupthink

The reason it pays to have more female CEOs, according to Cemlyn-Jones, isn’t because women have different abilities just because of their gender, who are “very reluctant” to claim that women or men are anything but equal, it comes up their leadership qualities. Rather, the benefit of having more female CEOs lies in the greater perspective it offers.

Gender aside, the more diverse the top team, the broader their range of experience will be, reducing the likelihood of groupthink. (The fact that the FTSE 100 currently has no black CEOs is another clear sign of the ongoing lack of diversity among blue-chip boards and the risk this poses to the quality of their strategic decision-making.)

Cemlyn-Jones adds that the historically high representation of women in HR is also relevant. As the UK economy becomes more service-oriented, the need for CEOs to be masters of people management is increasing rapidly, she argues. Given her recent experience in the fast-growing fintech industry, she believes this factor is something that large companies, which have traditionally appointed executives with strong financial skills, have been slow to grasp.

“If you compare FTSE companies to technology companies, you suddenly realize that the requirements for a CEO have completely changed,” she says.

The appointment of former Unilever hiring chief Leena Nair as CEO of fashion house Chanel in December suggests things may finally be changing. If so, female HR leaders could be well placed to take advantage.

Nonetheless, meaningful change will not happen without impetus. Before the official launch in November 2021, 25×25 conducted extensive research among business leaders. It turns out that ingrained cultural biases about who is—and who isn’t—fit for the top job are still ingrained. Such attitudes persist despite successive government-led efforts — such as the Davies Review in 2010 and the Hampton-Alexander Review in 2016 — to improve the situation.

“There’s been a lot of work done in the boardroom about gender representation, but it hasn’t really changed the number of CEOs,” says Cemlyn-Jones.

Providing a way up

This is mainly because the responsibilities of the role are very specific, as are the paths to get there. Just because there are more women on boards doesn’t automatically mean there are more female CEOs. For this reason, 25×25 focuses heavily on the concept of “routes” to the top position – in other words, how companies select, prepare and develop high-potential candidates internally or recruit them externally.

Some improvements to the selection process would be relatively easy to make. For example, having an independent observer present at job interviews could alert the company to unintentional bias, suggests Cemlyn-Jones.

But in addition to any quick fixes, companies need to ask tough questions about their talent development and promotion processes, she argues. For example, think of a major oil company or a global engineering company. The CEOs of such companies typically have broad operational experience in multiple areas of the business, which is fine on paper. But is expecting candidates to fight back and rotate regularly from post to post really fair to women given the impact on family life and the precariousness of certain assignments abroad?

The 25×25 initiative has so far resisted proposing a set framework for business. Instead, she urges them to “continue to challenge traditional models that may not be appropriate for the CEO of the future,” says Cemlyn-Jones, adding that goal setting is also key. Hard targets can oil the wheels of institutions better and make change more likely. In a nutshell, she says: “If it’s left to chance, we know that nothing will happen.”

Against this background, the participating companies are encouraged to set clear goals for a balanced gender ratio at the top two to three management levels.

“It’s very easy for people to say, ‘Oh, I was looking for a good candidate and couldn’t find one,'” she notes. “Then if a manager tells them, ‘Look again because this is important,’ they will look again and they will find you. It happens every time.”

Another 25×25 priority is for existing business leaders to be vocal about greater representation of women. Currently, a “handful of companies” are vigorously pushing this agenda, she says. As welcome as that is, if we don’t follow suit, “we’ll just end up with the same problem.”

Cemlyn-Jones explains, “When a CEO comes up and says, ‘This is important to me,’ we find that a decent job is being done.”

It is clear that several male CEOs in the FTSE 100 will need to become prominent cheerleaders for the campaign if it is to be successful. BP’s Bernard Looney, Unilever’s Alan Jope and BAE Systems’ Charles Woodburn have already signed up as Lead Ambassadors for 25×25.

So fast forward three years and imagine that Cemlyn-Jones’ efforts to change the face of the FTSE 100 leadership were successful. What difference would it make? Perhaps the most obvious impact would be the sense of opportunity afforded to half of the country’s working population, she says. The more female CEOs there are, the more normal this situation becomes for everyone.

Cemlyn-Jones’ vision is one of a virtuous circle where “everything seems to fit together”: more open doors to talented women, more balanced leadership teams, happier employees overall, and so on. In addition, it would mean a more productive private sector in general. By encouraging greater diversity, companies will shake off old habits and benefit from an influx of new skills and perspectives.

“We do this because we really think [a higher percentage of female CEOs] will perform better,” she says. “If you open up the talent base, skills will surface faster and you can accelerate growth.”

Of course, being a blue-chip CEO isn’t for everyone. The hours are long, the responsibilities are huge and the expectations are colossal. But everyone should at least have a chance to reach the top of the tree. That’s only fair – and wise.