The Female FTSE Report 2014, compiled by Lord Davies, highlights progress made on the proportion of women in boardrooms. It shows that women now account for a fifth of FTSE 100 executive board members, which is up from 17.3% last year.
Lord Davies (pictured) said that while the target of having women make up 25% of FTSE 100 board members by 2015 is on track (if past year growth continues the target would be reached in late 2015), companies could no longer ignore boardroom gender inequality.
"A company that doesn't get the mood of society on this issues deserves to go out of business," he said at the launch of the report today.
"The message for heads of HR is: you need to fix it and fix it quickly, or you are going to be out of sync with society and your investors."
Business secretary Vince Cable said the figures showed businesses were starting to get the right mix of talent in the boardroom.
"The [25%] target is going to be met, but it still requires more effort. It's not enough to appoint the odd woman here and there and leave the issue. [Businesses need to look at] issues like succession planning, transparency [and] having good metrics."
Heather Jackson, founder and CEO of women's professional group An Inspiration Journey, echoed Lord Davies' belief that companies that do not embrace diversity "will not be around in 10 years".
"We need to stop looking at small percentage changes and make real progress," she said. "What this does show is that companies are finally realising the benefits of having diverse boards."
The call for further progress is supported by the fact that in the FTSE 250 there are still 48 all-male boards. Also, while boardroom diversity has improved, very little progress has been made on senior executive female representation; women still only make up 6.9% of executive appointments compared to 6.6% in 2012.
Maria Miller, the minister for women and equalities, said: "The mindset of corporate culture needs to catch up with today's society. A career for a woman is not a nice to have, it's an economic necessity for many of us.
"I don't think more regulation is required. What needs to change is corporate culture. And corporate culture isn't set by machines, it's set by people."
Despite the improvement in board representation, Robert Half director Estelle James doubts many women are seeing an improvement in opportunities to progress to senior ranks.
"According to our research, more than a third of women have experienced barriers to advancement during their career, but nearly half (47%) of HR directors believe women are in fact advancing their careers on par with men," she said.
