There is increased awareness of ethnic diversity since the Black Lives Matter protests of 2020, but companies could do more to improve the transparency around the measures they are taking to make progress.
The conclusions come in a new report from watchdogs looking at the barriers to senior corporate positions for people from minority ethnic groups. It reveals their difficulties in attempting to move up the corporate ladder.
Interviews for the Financial Reporting Council (FRC) report revealed that candidates face a range of obstacles, including being overlooked for promotions; overt and covert racism; and having to demonstrate higher standards of performance than white colleagues.
But the review, Navigating barriers to senior leadership for people from minority ethnic groups in FTSE 100 and FTSE 250 companies, also found gaps in annual reporting on the subject. While a degree of reporting indicates commitment to achieving “diversity objectives”, FRC reviewers found a lack of detail in key areas.
Few companies detailed “race action plans” in any depth; targets were widely reported but there were “limited examples” of the initiatives designed to meet them; boards focused on recruitment, succession planning, talent mapping and working with headhunters, but the only activity with any “demonstrable impact” was external recruitment. In addition, annual reports largely failed to separate “specific diversity objectives” in their reporting.
Even when there are targets and objectives there are further problems, according to the report, which concludes there is “insufficient monitoring, measurement and accountability built in”.
The report adds: “Much greater emphasis should be placed on data analytics, and ‘equity goals’ should be built in to business strategies.”
Trust fund
Deirdre Anderson, director of the Gender, Leadership and Inclusion Centre at Cranfield University, and lead author of the report, says companies need to build trust with employees so they are more confident about self identifying which, in turn, helps develop more reliable information for monitoring progress. “This will help organisations expand on existing good practice and continue to dismantle the existing structural barriers.”
People interviewed for the report revealed how they encountered obstacles to moving on in their careers. Some described years of success without a promotion.
“I was the most qualified,” one interviewee said, “and had a list of successful deliveries behind me and an in-depth knowledge of tech and deep understanding of the industry, but things were not happening and there were times when I had to leave my organisations in order to move upwards.”
Another interviewee said: “You’re always wondering will somebody accept you, and you are always having to slightly change who you are, you can’t really convey your true self in these environments.”
People did use strategies to get on, which the FRC logged under five categories: assimilation, playing the game, celebrating one’s difference, paying it forward and creating one’s own brand.
But some of these strategies involved compromises. One said: “I deliberately hid that sort of, like the ethnic part of myself, to make me an easier sell, I guess, to others. … Then I came into [a senior role] with a lot more confidence than I had previously. And that has allowed me to be… I’m much more myself, I have to say, at work than I ever have been before.”
Sir Jon Thompson, chief executive of the FRC, says: “With the power of these personal insights and experiences that go beyond the data, I hope this report can help advance the conversation about how to successfully increase diversity in senior positions on boards and create sustainable pipelines of diverse talent to fill both executive and non-executive roles.”