Britain’s biggest companies are expected to have at least one Black, Asian or Ethnic Minority (BAME) member on their board by 2021, the CBI group of companies said.
Backed by companies like Microsoft and the Linklaters law firm, he said companies need to set “clear and broad goals” to improve diversity.
Currently, more than a third of the companies in the FTSE 100 are not represented by ethnic minorities at the board level.
The CBI said progress had been “extremely slow”.
The industry group said research by McKinsey consultants has shown that companies with greater gender and ethnic diversity are likely to be more profitable than their peers.
However, many of the largest companies listed on the FTSE had failed to boost diversity at the top, despite government recommendations made in 2016.
The CBI said companies must now publish more stringent targets within 12 months.
He called for FTSE 100 companies to have at least one board member of diverse racial and ethnic backgrounds by the end of 2021, and small FTSE 250 companies to have the same representation by 2024.
And he urged them to foster a “transparent dialogue” with employees, offer more mentoring and support, and work with a more diverse set of suppliers, including minority-owned businesses.
Lord Karan Bilimoria, the first president of CBI BAME, said: “The time has come for a concerted campaign on racial and ethnic participation in business leadership. Progress has been extremely slow. ”
Hugh Milward, Managing Director of Corporate External and Legal Affairs at Microsoft UK, said: “We are increasing diversity within Microsoft, and especially at our highest levels.
“But when more than a third of the main organizations still do not have representation on the board of directors of ethnic minorities, the pace of chance is too slow. Without commitment, there is no action.
Richard Houston, UK director of consultancy firm Deloitte, said the Black Lives Matter movement had “given a new sense of urgency to racial diversity in business.”
The movement, which began in 2013, has grown into a global phenomenon after black man George Floyd was killed by US police earlier this year.