(Bloomberg) -- The U.K.’s top investment-industry group plans to warn shareholders about companies that aren’t making enough progress on increasing ethnic diversity in their boardrooms.
The Investment Association, whose members manage about 8.5 trillion pounds ($12 trillion) of assets, said it will issue alerts about firms that don’t report the ethnic make-up of their boards, according to a statement on Wednesday. Three-quarters of companies in the FTSE 100 index failed to provide this information to shareholders in last year’s annual general meetings.
The industry group will also draw attention to companies that haven’t offered a credible plan to have at least one director from an ethnic minority background by this year.
“The U.K.’s boardrooms need to reflect the diversity of modern-day Britain,” Andrew Ninian, director of stewardship and corporate governance at the Investment Association, said in the statement. “Investors are now calling on companies to take decisive action.”
Public companies are coming under increased pressure from investors and lawmakers to hire and promote more people from ethnic minority backgrounds. BlackRock Inc., the world’s largest asset manager, said in December that it will push companies for greater ethnic and gender diversity for their boards and workforces, and will vote against directors who fail to act.
The Investment Association will also issue alerts on companies where female directors make up 30% or less of board membership, according to the statement. The group issues the warnings as part of a service to give shareholders independent information and help them decide how to vote at companies’ annual meetings.
©2021 Bloomberg L.P.