LONDON: Women should make up at least 40pc of boards at British listed companies and one director should be a person of colour, the country’s financial watchdog said on Wednesday as it set a range of diversity targets for firms’ top leaders.

At least one senior position such as company chair, chief executive or chief financial officer should be held by a woman, the Financial Conduct Authority said, largely confirming early proposals. The FCA said companies will have to make annual statements showing how they are complying with the new rules, or explain any divergences.

“As investors pay increasing attention to diversity at the top of the companies they invest in, enhancing transparency at Board and executive management level will help hold companies to account and drive further progress,” said Sarah Pritchard, the FCA’s executive director of markets.

In February the government-backed FTSE Women Leaders Review said female representation on the boards of Britain’s top 100 companies stood at 39.1pc.

The review raised a voluntary target to 40pc for the top 350 companies by the end of 2025, up from a previous target of 33pc.

“The new rules will be challenging for some companies,” said Delphine Currie, partner at law firm Reed Smith. “This is likely to lead to a fair bit of competition for diverse, non-executive directors.

A separate survey said in March that the majority of Britain’s top companies now have at least one ethnic minority board member.