The Parker review committee, led by Sir John Parker, has published its final report re-emphasising the conclusions made last year that business leaders need to improve the ethnic and cultural diversity of UK boards to better reflect their employee base and the communities they serve.

The review team recommended that every FTSE 100 board should have at least one director from an ethnic minority background by 2021 and for each FTSE 250 Board to do the same by 2024. The report also recommends that companies develop a pipeline of candidates and plan for succession through mentoring and sponsoring and enhance transparency and disclosure to record and track progress against the objectives.

The Parker review committee consulted on the report launched in November 2016. The committee said that the feedback had been very positive, with stakeholders offering constructive suggestions to make the recommendations more impactful including the extension of the review’s recommendations beyond the FTSE 350 to apply to all companies and the third and public sectors.

The review found that as at the end of July 2017, only 85 of the 1,050 director positions in the FTSE 100 were held by people from ethnic minorities. Just 2% of director positions are held by people from ethnic minorities who are UK citizens, despite this group making up 14% of the total UK population (up from 2% in 1971). There are 51 companies in the FTSE 100 which do not have any ethnic minorities on their boards.

The steering committee said it would continue to track the progress made against the recommendations on an annual basis.

Sir John Parker said: “Today’s FTSE 100 and 250 boards do not reflect the society we live in, nor do they reflect the international markets in which they operate. Whilst we are making good progress on gender diversity in the boardroom, we still have much to do when it comes to ethnic and cultural diversity.

“Our report has identified clear commercial benefits in addressing this issue, and it is crucial to make progress in this area if we want Britain to continue to be at the forefront of global business. We also outline some business-friendly recommendations, which aim to not only increase the ethnic diversity of Boards in the near term but also develop a strong pipeline of candidates for the future. These recommendations received overwhelmingly positive feedback and we have now provided some practical tools to help Boards implement them.

“I look forward to seeing a change in the boardroom as we continue to track progress in the coming years.”