Revealed: the trust managers putting their money where their mouths are

Board diversity has improved over the past year across UK investment companies, both in terms of gender and minority ethnic backgrounds - but there are 13 all-male trust outliers, Investec Securities can reveal.

In the latest 121-page Skin in the Game Report, covering 298 investment companies and 1,445 chairpersons and directors, Investec Securities' research found that two-thirds of companies in the report met the target to have at least 40 per cent female representation on boards. 

It also highlighted a significant boost in the number of trust managers and directors putting their own personal money to work in the trusts they run, signifying they are aligning their interests with those of their investors (see below for more details).

In terms of hitting the Financial Conduct Authority's targets, a total of 217 companies - equating to 74 per cent of those within the scope of the research - met the regulatory target of having at least one woman senior board member.

Some 84 companies disclosed they had met the target of having at least one member from a minority ethnic background.

Enhancing transparency at Board and executive management level will help hold companies to account and drive further progress.Sarah Pritchard, FCA, 2022

The 2023 report has been compiled by Alan Brierley and Ben Newell, who have hailed significant progress towards diversity targets.

However, they highlighted that only 22 per cent (64 companies overall) could meet all three of the regulatory targets.

The research also named and shamed 13 companies that have all-male boards. This is a significant drop from 2010 - when the Skin in the Game report was launched.

At that time, the number of investment companies with all-male boards stood at 159. 

In the 2023 report, the authors said: "We believe the majority of these companies are challenged."

It listed the all-male boards as per the image, below:

Annabel Brodie-Smith, communications director of the Association of Investment Companies, told FTAdviser: “It’s been great to see the progress made by investment companies towards more diverse boards, particularly when it comes to gender diversity.

"The AIC supports diversity on boards and this topic has been a regular feature of our director conferences and roundtables."

It also has a website, called Pathway, which aims to encourage a wider range of people to consider becoming investment company non-execs.

But, as she commented, "there is still more work to do".

In 2022, the FCA set out its approach sets positive diversity targets for listed companies, stating that "If they cannot meet them, they need to explain why not".

These are within the FCA's listing rules.