Just one in four directors of small firms is a women

Gender disparity is still rife – not only on the FTSE-100 boards, but in the grassroots businesses that drive the UK economy. Mark Leftly reports

Only a quarter of directors at Britain's medium and small-sized firms are women, according to research produced for The Independent on Sunday today.

The gender disparity in the UK's biggest listed companies is well-known, but the survey shows that the problem is also rife in the grassroots businesses that drive the economy.

Analysing 619,000 firms with 500 or fewer employees, database company Blue Sheep found that 70 per cent of their directors were men, 25 per cent women and 5 per cent unknown.

The news piles further pressure on Lord Davies of Abersoch to come up with an effective strategy to get more women on company boards when he reports his plan to the Government in February. The former Standard Chartered chairman was asked by the Department for Business last summer for ideas to tackle the inequality.

The Federation of Small Businesses (FSB) will launch a report this month highlighting the success of US initiatives to encourage women into business. "We need to look at things like developing female mentors to help women start businesses and women-only networks," said an FSB spokesman.

The FSB's concern rose after it found that only 15 per cent of sole traders among its membership are female, down from 16 per cent a year ago. The spokesman said that the two-thirds of the 500,000 public-sector workers likely to lose their jobs will be women.

The federation believes that getting these women into business roles could contribute £23bn to the UK economy. "Women are a hugely untapped area of entrepreneurship," said the spokesman. "The Government launched the £12.5m Ascent fund to support women-led businesses [in 2008] and the coalition is continuing with it, but only £2m has been spent supporting just seven businesses."

Blue Sheep chief executive Iain Lovatt said the problem is less acute in younger age groups, with women taking 30 to 35 per cent of directorships in the 18 to 30-year-old bracket.

This could be because this age group focuses on digital and online-related industries that have only been set up in recent years. Louise Burgess, who with her husband co-founded digital agency Equi Media 11 years ago, said: "Men haven't got a historic advantage in our industry, it's brand new so there is a level playing field for both men and women. In fact, it is dominated by young people."

The research, which was divided by post-code area, shows that there remain geographic strongholds for male businessmen. The City of London has the worst imbalance (see map), with only 14 per cent of 66,200 directors being women.

The City figures are unsurprising given the difficulties that women have had getting on to the boards of major listed firms, many of which are based in the Square Mile. Earlier this year, The Independent found that not one FTSE 100 company had a 50:50 gender balance, and that there were only 120 individual female directors out of a pool of 1,100.

Two postcodes covering London's West End and Manchester were also in the bottom six of this survey, with Kingston Upon Thames also faring badly, showing that women are struggling for recognition in England's commercial hubs.

Some of the most remote areas of the UK showed some of the greatest gender equality. The Outer Hebrides and Caithness in far north-east Scotland were the only regions where 40 per cent or more of directorships were held by women.

In England, the only area where at least a third of directors were female was Hereford, and in Wales there was just the Llandrindod Wells post-code area, which is around Brecon, on the English/Welsh border.

Despite the findings, there are signs that women have gained prominence in recent years. West Ham United Football Club vice-chairman Karren Brady has become well known for her role in The Apprentice television show, while entrepreneurs Deborah Meaden and Julie Meyer star in the broadcast and online versions respectively of Dragons' Den.

In November, Ana Patricia Botin was named the chief executive of the UK arm of bank Santander. She has been entrusted to oversee a flotation of the business that could raise £3bn.

Already in the FTSE 100, Anglo American boss Cynthia Carroll has proven herself a tough cookie in the macho world of mining, and Katherine Garrett-Cox oversees several billion in assets as chief at Alliance Trust.

They follow in the footsteps of Dame Marjorie Scardino, who became the first female FTSE 100 boss when she took over publishing group Pearson.

There are women executives included in the survey who believe that appointments such as these show that sexism is a thing of the past.

Elly Woolston, director at direct marketing agency DMS, with responsibility for 100 people, says: "I'm surprised the figures [of women] are so low. I don't buy gender bias – in our sector we just look for the best person for the job."