Skip to Main Content

Board composition

2021 UK Spencer Stuart Board Index

2021 Snapshot

 18 %

of board members are newly appointed

 51 %

of new non-executives are first-time listed company directors

 27 %

of first-time non-executives have a background in financial services

New directors

In the 12 months covered by this report, 264 new board members were appointed to the top FTSE 150 companies. The proportion of newly appointed board members (18%) is the highest since 2015.

Twenty-three per cent of non-executive directors (198, excluding chairs) were appointed in the past year; 52% (103) are women, 19% (37) are minority ethnic directors, and 48% (95) are non-UK nationals. More than half (61%) have portfolio careers while 39% are current executives, inverting last year’s trend when 53% of NEDs were executives and 47% portfolio. The majority of new NEDs (52%) have at least one other board role.

When looking only at new executive directors on the board, 15% (51) were appointed in the past year, 18% (9) are women, and 6% (3) are minority ethnic executives. Nearly all newly appointed women and minority ethnic executives are CFOs, the two exceptions being Milena Mondini de Focatiis, CEO at Admiral Group, and Jette Nygaard-Andersen, CEO at Entain.

This year’s new cohort of board members is the largest of the past five years for both executive (15%, 51) and non-executive roles (22%, 194).

New appointments

Out of the 23 new chairs appointed to the role this year (a replacement rate of 15%), seven are women and they all have portfolio careers. Three women are chairing a FTSE company for the first time: Thérèse Esperdy at Imperial Brands, Shriti Vadera at Prudential, and Jasmine Whitbread at Travis Perkins.

The 2021 cohort of female chairs is continuing the advances seen in 2020, when there were four new appointments, and three were newcomers to the role in public companies. In 2019, no women were appointed as chairs.

Sector background of new non-executives

First-time NEDs

Twenty-two per cent (194) of non-executive directors are newly appointed; of these, 35% (68) are first-time non-executives, a figure that has remained relatively constant for the past six years.

Proportion of first-time NEDs who are women
Proportion of first-time NEDs who are non-nationals

First-time NEDs are on average 54.2 years old, five years younger than the overall NED average (59.8). The proportion of women is the lowest of the past three years (43%, 29), whereas the share of non-nationals has increased to 53% (36). First-time directors with a minority ethnic background represent 25% (17) of the cohort, and most of them are men (11).

The financial sector provided the most significant number of first-time directors in the year (27%), followed by a tie between the consumer and industrial sectors.

First-time chairs

There are six new chairs leading a public board for the first-time, half of them are women: Shriti Vadera at Prudential, Jasmine Whitbread at Travis Perkins, and Thérèse Esperdy at Imperial Brands. Thérèse Esperdy joined the board in 2016, became SID in 2019 and chair in 2020.

Their three male counterparts are John Manzoni at SSE, Robin Budenberg at Lloyds Banking Group, and Paul Mason at Dr. Martens. Although chairing a public board for the first time, Paul Mason was chair of Dr. Martens before the company went public in January 2021.

Finding the Right Fit: Assessing First-Time Candidates for Non-Executive Directors

A framework to help boards determine the readiness of a new director.

Becoming a non-executive director

A guide for those considering a board directorship for the first time, expanded and updated.

Becoming a non-executive chair

A guide for directors who aspire to become chair of the board or are becoming a chair for the first time.

Board size

The average board size is 9.9, the smallest recorded in the past decade. The proportion of boards with eight or fewer directors fell to 25% from the 30% recorded in 2020, marking a level closer to the 21% seen in 2019.

The smallest boards are composed of six members, each encompassing two executives and four non-executives. The largest boards are InterContinental Hotels Group (IHG), with 15 members (three executives and 12 non-executives), and Berkeley Group Holdings, with 17 members (six executives and 11 non-executives).

At most companies the CEO (95%) and the CFO (89%) sit on the board; 23% also have regional or divisional chief executives and/or other C-suite occupants as directors. There are only four executive chairs in our sample, each of whom is a founder-owner: Micky Arison at Carnival, Said Darwazah at Hikma Pharmaceuticals, Peter Cowgill at JD Sports Fashion, and David McMurtry at Renishaw.

93% of non-executive directors are deemed independent — a figure that has barely fluctuated over the past decade.

Composition of executive directors

At most companies the CEO (95%) and the CFO (89%) sit on the board; 23% also have regional or divisional chief executives and/or other C-suite occupants as directors. There are only four executive chairs in our sample, each of whom is a founder-owner: Micky Arison at Carnival, Said Darwazah at Hikma Pharmaceuticals, Peter Cowgill at JD Sports Fashion, and David McMurtry at Renishaw.

Independence

93% of non-executive directors are deemed independent — a figure that has barely fluctuated over the past decade.

Length of service

Average NED tenure has been stable for a decade, at around 4.3 years. Other than among a small fraction of chairs, NEDs do not generally exceed the recommended term limit of nine years.

The average tenure of CEOs on the board has increased from five years in 2020 to 5.8 in 2021. Average CFO tenure is steady at 4.2 years.

Tenure
Average <1 year 1–3 years 4–6 years 7–9 years >9 years
Chairs 5.7 9% 31% 24% 21% 17%
Non-executives 4.3 22% 38% 24% 11% 6%
   Female 3.4 23% 42% 22% 10% 3%
   Minority ethnic 3.2 32% 40% 14% 7% 6%
   Non-UK nationals 3.5 24% 40% 21% 10% 5%
CEOs 5.8 8% 31% 16% 15% 33%
CFOs 4.2 23% 35% 23% 9% 11%
Other executive directors 6.6 15% 36% 11% 15% 23%

Age

The average age of non-executive directors (59) has held steady during the past five years. Among chairs, the average age increased slightly since 2017, only to fall back to 64.9 in 2021.

New NEDs are, on average, two years younger (57.7) than those they are joining on the board (59.8). The youngest new NED is ITV’s Graham Cooke (39), and the most senior is International Consolidated Airline’s Peggy Bruzelius (71).

Looking at gender diversity, new women NEDs are slightly younger (58.6) than their male counterparts (59.9), increasing last year’s gap from 1.3 to 2.5 years.

Average age of directors