FCA finalises proposals to boost disclosure of diversity on listed company boards and executive committees
The Financial Conduct Authority (FCA) has finalised rules requiring listed companies to report information and disclose against targets on the representation of women and ethnic minorities on their boards and executive management, making it easier for investors to see the diversity of their senior leadership teams.
The FCA’s approach sets positive diversity targets for listed companies. If they cannot meet them, they need to explain why not. This approach allows flexibility for smaller firms or those based overseas. The rules also allow companies to decide how best to collect data from employees to show they are meeting the targets.
The rules will apply to listed companies for financial accounting periods starting from 1 April 2022. The FCA will review the rules in three years’ time to make sure they are working and to check if the diversity targets are still appropriate.