FT BOARD DIRECTOR PROGRAMME NEWSLETTER

‘We know about the “butterfly effect”, the idea that a flap of the insect’s wings in Brazil might ultimately trigger a tornado in Texas. When it comes to diversity policies, a more direct “Trump effect” is being felt across continents.’

One of the most important reads of the week was Andrew Hill’s comment on how recent changes at the Australian Securities Exchange (ASX) represent a wider rollback of diversity initiatives on a global scale. 

The changes stated that ‘gender targets for female board directors would be frozen, those for executives removed, and progressive ideas about expanding the goals to cover race, sexual orientation, religious beliefs and socio-economic background would be shelved. 

It’s easy to say this is just one company, but Hill is right - the effects of Trump’s rollback of DEI policies is having a ripple effect all over the world. For companies based in the US or with US counterparts, the change is obvious - a lack of funding for previous equality programmes and a widespread change in attitude towards targets to increase female representation. Some have been scrapped altogether while others, such as the Australian Securities Exchange have lowered targets (in the case of ASX, the target for female board representation is down to 30 percent rather than the recommended 40). 

But the change is having a far wider effect. Both in the c suite and at board level, women and ethnic minorities remain underrepresented. As scrapping or lowering targets becomes more normalised and programmes to support future female leaders are shelved, this will have a knock on effect on company culture, and how safe and supported minority employees feel. 

As Hill concludes: ‘I like to hope that earlier efforts to embed corporate diversity policies will mean they continue, even at companies that now dare not speak their name.’

The changes stated that ‘gender targets for female board directors would be frozen, those for executives removed, and progressive ideas about expanding the goals to cover race, sexual orientation, religious beliefs and socio-economic background would be shelved.