Equality, diversity, and inclusion (EDI) in the workplace are increasingly recognised as topics that need to be acknowledged and addressed by businesses. Recent movements such as Black Lives Matter have made it harder for businesses to shy away from reviewing their EDI policies. Increasingly, candidates and customers are asking for business’ EDI statistics and policies before accepting a job or buying from them. It is, therefore, important companies address these issues if they are to stay relevant and successful.
This article shares highlights from the session where guest speakers, listed below, joined Gareth John to discuss the importance of diversity in the workplace. Including how it can benefit businesses, the impacts of the pandemic, and what businesses can be doing to improve EDI.
Speakers and panelists
- Richard DeNetto, Associate Director at CBI and Campaign Lead for Change the Race Ratio
- Sharon Critchlow FCCA, APFS, Chartered MCSI, FRSA, Wellbeing and Emotional Intelligence Evangelist and Trainer
- Rachel Blackburn MBA, Executive Coach at US2U Consulting
- Representatives from the awarding bodies AAT, ACCA, CIMA and ICAEW
You can watch the recording of the forum by clicking the button below.
Change the Race Ratio
Richard DeNetto, Associate Director of the CBI, has helped lead the Change the Race Ratio since its launch in September 2020. The campaign uses the CBI platform to improve diversity in businesses, specifically for board and senior management representation where the gap is bigger.
The Change the Race Ratio campaign was set up to emulate the progress made in gender disparities at board level. Executive groups and board level employees are targeted as this is where the culture is set in a business. The campaign aims to accelerate progress in diversity in businesses by working together rather than apart.
Change the Race Ratio was originally founded with 15 businesses who bring their different expertise and resources to help the programme. Now there are around 100 signatories including businesses of all sizes.
The programme consists of four commitments:
- In line with the Parker Target, to have FTSE companies put one minority member on their board by the end of 2021, and by the end of 2024 for the top 100.
- Other businesses to set goals to include minority members of staff on their board – related to their size and location.
- Make data on EDI statistics readily available and publicise all pay gap information by the end 0f 2022.
- For businesses to set action plans to fill gaps where there is a lack of representation and where the organisation does not align with the communities they are serving.
Once signed up, signatories have access to resources and support to help them continue to make progress. This includes monthly events and briefings as well as access to one-to-one consultancy from a team of race expert ambassadors.
Why is EDI important? How can it benefit individuals, businesses, and society?
Sharon has personal experience and consulting expertise in the issues surrounding EDI. She believes EDI is a matter of not getting the most out of people. Businesses should ensure the right people are employed in the right jobs and are allowed to grow. Not allowing employees to be their whole self at work is stifling them and in turn, impacting the business and profession.
As a result of social media, whatever a company does that is unfair or unethical will get out via posts or reviews. Companies are therefore already unofficially being forced into transparency. Not giving people the right encouragement or putting things in the way will eventually get out to investors and customers. This will impact how your business is perceived by the world and affect people’s buying decisions. Sharon states that if you are not proud of your actions then you as a business should not be doing them.
Rachel believes businesses should all know the Equality Act 2010 inside out. If they stick to the principles of that legislation they can’t go too wrong. Legislation is glue and an enabler for businesses to make necessary and worthwhile changes. They can also help businesses address problems before they surface and something goes wrong.
Richard agrees that equality is about fairness, this is what has driven recent social movements. If you are running a business it is right that the employees and leadership represent and reflect the community that you serve. This will help make better choices as you will have more diversity of thought that will understand and accelerate the product. For unfairly representative boards, it is a matter of when businesses notice as opposed to if. This will likely be when sales are significantly impacted, as consumers are already making buying decisions based on diversity policies.
Comments from the audience
As well as following legislation, enforcing EDI policies is about the moral responsibilities of inclusivity we have as business owners. Businesses don’t know what customer and client base they are missing if they don’t reach out to them.
For a lot of companies up until now, it has been a case of willful ignorance. However, there needs to be a point where something has to be done by businesses to take action in order to move forward.
Businesses acknowledge that changes are needed to ensure a fairer workplace. However, there is a lack of understanding of what can be done to change things and whose job is it.
What progress has been made towards EDI in the workplace over the past decade, particularly towards increasing ethnic diversity, gender inequality, and social mobility?
Progress has been made but there is always more a business can do. 5 – 10 years ago businesses didn’t even know key terms related to EDI. Today businesses and leaders are better at talking about diversity but are not yet comfortable. Professionalism and support of EDI are pushing businesses in the right direction, targets that have been made and are being met. Targets and mandatory reporting mean that what gets measured gets done. For example businesses with over 250 employees are reporting their gender pay gap. 120 businesses in the UK are reporting their ethnicity pay gap.
Reporting has helped shine a light on where businesses have problems so they can’t shy away from them. However, one-fifth of FTSE 100 firms don’t have ethnic minority representation on their boards. Whilst there are no black chairs, chief execs, or CFOs on any of the FTSE 100 companies, a backward step from 2014.
How do you think the pandemic has affected progress made towards equality and ethnic diversity in the workplace?
The pandemic has led to multiple EDI webinars taking place whilst people have had more time to attend them. However, there is concern whether any action will actually come of them. Organisations are still confused about what they can do to help. Some organisations have done their best to implement changes whilst others have used the pandemic as an excuse to postpone addressing the issues. Many have said they need to wait until business is as usual or that they will address it when they next need to recruit.
Rachel notes that when a company is actively recruiting it is less likely to be inclusive. Particularly if there are a high number of applicants. If there are more people to choose from businesses will automatically have higher standards. Businesses are therefore less likely to consider EDI, whereas with a smaller pool of candidates they may be more lenient on qualifications and background etc. It is important to be mindful of these positives and negatives when recruiting.
Rachel is concerned that businesses are not aligned as an organisation. There needs to be a conjoined effort and approach to EDI in large companies to ensure every part of the business is aligned. As well as making efforts to implement changes as opposed to just ticking a box.
Flexibility and hybrid working are great for some, however, certain minority groups may be living in smaller housing. Companies implementing mandatory working from home are often making assumptions everyone has a nice and safe space to work. Working in poor conditions can make it harder for people to reinvent themselves, something they can do in the office. Furthermore, it might be harder to work effectively in poor working conditions and therefore progress. This should be considered when businesses are implementing their plans for future working.
However, the ICAEW notes that an effective hybrid working model needs to have true flexibility and that in some cases the pandemic has acted as a leveller. The virtual work experience offered by the ICAEW has meant some students feel more comfortable working from home. They have not had to worry about dressing the part if this is something they are not used to. It has also made work experience more accessible for those who do not live in the immediate London area and may not be able to afford the commute into the office. You can find information on how to get involved in offering virtual work experience here.
Businesses may be making excuses not to change because of the pandemic, however, it is always easy to find excuses to delay something that makes you uncomfortable. It is really about culture and what you want to be known for. The little decisions businesses make affect the bigger decisions and assumptions down the line. Businesses should consider what a decision is going to give them and whether it reflects what they believe. Is employing candidates from Russell Group universities going to give them people from minority groups if that is what they need? These decisions ultimately lie with senior management, they need to break down moulds and assumptions of what ‘good’ looks like.
What is a business’s case for driving diversity and what are the implications for a business that does not reflect the customer base they serve?
As things have become more computerised, businesses have taken on people for lots of different reasons and roles. The case for driving diversity comes from what we want businesses to look like moving forward. Humans offer ideas and creativity that technology cannot so more people are needed in order to reach more markets. Particularly at the moment when contact with others is more reduced than ever, how are businesses going to hit hearts and minds if they don’t have experience and input from different societies.
Sharon believes that the wider people we have around the table, the easier it is to get it right, to get more sales, and see new opportunities. If a business can’t benefit from talent because they can’t see past prejudice, then a competitor will.
What is your advice for businesses to effectively engage in EDI?
Three suggestions for organisations to consider to effectively engage in EDI:
- For an organisation to change it has got to come from people at the top. They need to provide the resources and time, then the right strategy and policies. Businesses can start by looking at their website and ensuring equality policies are up to date and images are inclusive. Does the marketing strategy tie in with the business’s values? Businesses also need to make sure their social media content is diverse. Not everything is common sense so invest in training and education to engage staff.
- Businesses need to prepare for uncomfortable conversations to be able to move forward. It is okay to have uncomfortable conversations if you are serious about progressing and changing. Unlearning is as good as learning but it can be challenging to question people’s values and language they have grown up with from respected family members. As well as question their beliefs of what is right and appropriate.
- Make sure staff do understand the equality act, particularly leaders. You can tell if someone understands through their language. People should know the difference between racist, antiracist, different biases, and what is appropriate. Businesses need to give staff the tools and resources to teach them so they know what language is acceptable and how not to cause offence.
Businesses need to think about what it is to be inclusive. If you are a white middle-class male you are still a part of diversity, you are just the majority. Telling people’s stories from right across a company is powerful as it connects on every level from all parts of the business. Leading from the top is where you get real buy-in and see alternative leadership in the space. If you are a small organisation make sure you have an EDI network, whilst bigger businesses can split this up further to ensure all voices are heard. This is also a great development opportunity for the people in those networks to support them in their own development.
Remember white middle-class males might feel under attack and blamed for something they don’t feel they are responsible for. It is important businesses understand all voices from all groups. Although policies and structures are important, understanding and connections on a personal level are also vital. If people feel empowered to speak out and help then change is more likely. Mentoring can play a part in encouraging someone to step up when they see something wrong. It also helps with understanding different perspectives around the table because you know that person and understand on a personal level.
Why do you see EDI as an important issue for members of your organisation and for the organisation itself?
AAT has 130,000 members worldwide and is an entry-level qualification. It is therefore important to remove as many barriers as possible and be diverse both internally and externally. The AAT has tried to lead in this and started doing their own gender pay gap reporting before any legislation came in. They were also the first accountancy body to sign up to the women in finance charter. Internal targets helped drive this action, for example, gender diversity at senior level is linked to bonus rewards.
Currently, the AAT doesn’t have much data on ethnicity, internally they are trying to learn more but will only be able to make inroads if they have the data. Since a lot of their business comes through different avenues they do not always have access to background data. This is something the AAT is currently working on fixing.
Internally, as the office is based in London, AAT has a more representative demographic than the UK average. However, looking at different data shows that in fact there are parts of the business that have never been looked at or monitored that indicate it is not performing well in diversity. For example who is progressing at different levels and what appraisal rating staff are getting? It indicated that at some levels the company is doing very well and at others not. What is evident is that companies need the right data and they need to unpick it to be able to see where there is an issue.
Having EDI champions internally and lots of different awareness-raising events help towards creating an inclusive culture. However, it is the actions that are going to create change whilst reports will measure progress. The AAT aims to deliver their learnt lessons externally once they have been addressed internally.
ICAEW is also working on member data and where to get it from. A lot of work needs to be done amongst members and society to explain why they are collecting this data and what they are doing with it. Effective communication will build trust between consumers and organisations using their data.
There is a lot of untapped talent because of the stereotypes of what a successful accountant looks like. The ICAEW is trying to break these barriers. Clients may want to see accountants who look like them and can relate to them. However, there will be a point where others notice this and won’t work with companies that do not look as diverse as their client base. Furthermore, the quality of the work suffers without a diverse team. Boards or teams make better decisions with more diverse people that have different experiences and perspectives.
The ICAEW has been focusing on ethnicity and engaging with supporting black heritage students. They were the first professional body to sign up to the Black Talent Charter committed to raising black heritage senior leadership in the next 5 years. They have also focused on participating in events for black heritage students and the 10,000 black interns initiative.
Recruitment is another important area to look at and invest in for EDI. Diversity and inclusion are definitely becoming more important in attracting clients and employees. 6 out of 10 job searches are asking about diversity and inclusion in interviews. Whilst 4 in 10 would turn down a job if they were not happy with the company’s EDI policies. This shows how relevant it is for companies to polish their policies if they want to keep attracting top talent.
EDI is at top of the agenda for CIMA and from what they have seen, effective policies and implementation work. There is some resistance to EDI in certain ‘conservative’ areas and it will take some time to overcome this. However, eventually, it will become normal practice. Members have the opportunity to encourage EDI in practice, so it is important to CIMA that they lead by example.
There needs to be a clearer understanding and distinction between being inclusive and being a global organisation. The awarding bodies are working on this as well as on progression and collecting data. However, what is acceptable data to collect here in the UK may not be acceptable elsewhere. This is a massive challenge for global organisations in how to collect data sensibly. A solution is to embed data collection for diversity purposes into the culture of the profession. This again comes back to implementation from the top and the individual responsibilities at the bottom. We are not yet at a point in the pandemic where we can say what the impact has truly been in terms of EDI. Some early surveys suggest it has negatively impacted EDI. There are many topics to unpack surrounding EDI in the workplace and it is important to keep at it for change to incur.