Recommendation 4

The appointments process is not set up to encourage diversity amongst NEDs. In June 2019, the government launched a Public Appointments Diversity Action Plan to focus on broadening access and improving the diversity and quality of appointees. The plan included an ambition for 50% of all public appointees to be female and 14% of yearly appointments to be from ethnic minority backgrounds by 2022. The Cabinet Office did not meet those targets, reporting that in 2021–22 47% of all serving public appointees were female and 12% of all appointments and re-appointments went to people who were from an ethnic minority background. We recognise that the National Audit Office’s analysis found that the diversity of new appointees has improved: it found that in 2022–23, 53.7% of new appointees were female and 14.6% were from an ethnic minority background. But the Cabinet Office has not put in place a new diversity targets and has no plans to do so. Nor could it point us to convincing examples of how it deals with conscious and unconscious bias within the appointments process. Without checks on any bias, the current Non-executive appointments 7 process—in which ministers appoint the Advisory Assessment Panels who identify appointable candidates on which ministers then make a final decision—risks seeming insular and circular. While Ministers can only directly appoint a non- executive director in “exceptional cases” when making regulated appointments, there is no such restriction for unregulated appointments and it is not apparent if this has occurred or how frequently. Recommendation 4: In its Treasury Minute response to this report, the Cabinet Office should: a) state a date by when it will put in place a new diversity action plan for public appointments; b) set out the steps it has taken so far to review the feasibility and usefulness of compiling data on the diversity makeup of members of Advisory Assessment Panels, and the date by which it would report its conclusions to Parliam