Ethnic and Gender Diversity: An Exploratory Analysis of UK Directorships
Posted: 26 Feb 2015 Last revised: 29 Oct 2015
Date Written: February 25, 2015
There are two major strands of debate on the issue of diversity in the corporate sector. The first concerns diversity (ethnicity, gender) within the boards of directors of UK companies and the second concerns the incidence and contribution of migrant ‘entrepreneurs’ or ethnic businesses across the UK corporate business population. However, the evidence base on diversity within the population of UK companies is scant. Taking a snapshot of all directors and companies in a unique data-base at the beginning of 2014 provided details of 8,870,881 directors. The individual directors could be matched with 7,404,463 individual company registration numbers and associated company characteristics. The Cultural-Ethnic-Linguistic (CEL) classifications of directorships in the study uses both the recorded nationality of the director and the ONOMAP classification algorithm based on given and surname. Around 87% of the directorships analysed were individuals of UK/European roots or nationality and white. Between 4-5% were Asian (Indian, Pakistani, Bangaldeshi) and around 1% Black African or Black Caribbean and just over 1% of Chinese origin. Around 5% were of Central or Southern European origin. These figures are in line with population demographics based on Census 2011. The picture that is revealed of directorships is more one of ethnic concentration in ethnic businesses focused on industrial sectors and location than ethnic diversity within company boards. Female directorships account for around 33% of the total and the proportion of female directorships declines with size of company (around 12% in listed companies, one average over the time period.). A large proportion of the directors who record a non-UK nationality are associated with UK subsidiaries of (large) foreign parent companies and these should not be classified as 'migrant entrepreneurs'.
Keywords: Directors, Diversity, Ethnic, Gender
JEL Classification: G34, L00
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