Ethnicity affects progression at work, say business leaders
BAME employees ‘not on the radar’ of boards, with unconscious bias and ‘old boys’ networks’ to blame
Almost three-quarters (71 per cent) of senior executives believe their ethnicity or race has had a significant impact on their career, according to a new report which lays bare the lack of progress on inclusivity at all levels of business.
The study, from networking platform Engage and recruiters Harvey Nash, surveyed 130 senior executives from various cultural backgrounds. Just over half (52 per cent) of respondents said CEOs and executives lack an understanding of the benefits of a diverse board, while 62 per cent felt people from ethnic minorities were “not on the radar” of leadership teams or executive search firms.
Leaders from ethnic minority backgrounds suggested that the unconscious bias of CEOs and boards – which are 95 per cent white among the FTSE 100 – is preventing BAME employees from reaching the upper echelons of business. Four-fifths (82 per cent) of all leaders felt that factors aside from their merits and qualifications had hindered their career progression.
The figures follow a recent investigation from the Equality & Human Rights Commission (EHRC), which found that only 13 per cent of FTSE 100 companies provide training on equality law or avoiding unconscious bias to those with board recruitment responsibilities.
Denise Keating, chief executive of the Employers Network for Equality and Inclusion (enei), said the outdated “‘old boys’ network” was still being used widely in businesses, and that too few companies are setting targets for BAME candidates or actively encouraging them to apply for roles.
“Perception is reality and if people believe [they are being held back] then there is clearly an issue which needs to be addressed,” said Keating. “Some employees can be ‘kept out’ through organisational culture and leaders’ negative behaviours, such as focusing on how a new board member may ‘fit in’ with them.
“There’s a wealth of research showing that diverse executive boards enjoy significantly higher earnings and returns on equity (ROE). For instance, an EHRC report found that companies with the highest levels of diversity had ROE that was 53 per cent higher than those with the least.”
The Engage/Harvey Nash report suggests a number of actions BAME leaders feel would improve diversity on boards, including: targeting recruiters to include diverse candidates on shortlists (36 per cent); educating CEOs and boards on the value of diversity (32 per cent); and insisting on transparency and reporting on both the full recruitment process and ethnic diversity at executive and board level (28 per cent).
Keating backed the call for greater accountability: “Diversity should be on the board agenda, and there should be targets for individual board members to achieve, including a requirement to regularly report progress. Boards also need to be trained in both inclusive leadership and unconscious bias, and communication needs to focus on progress, role models and the organisation’s commitment, as well as its overall intentions.
“Organisations with a lack of board diversity need to find out what is really happening, and set standards to achieve progress,” she added. “This includes using staff surveys, networks and focus groups to get feedback, and developing action plans to address them at every level in the organisation.”
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