Green Park Business Leaders Index 2021 (link)
A review of the gender and ethno-cultural diversity composition of UK’s most senior leadership
- “One of the most significant findings from our 2020 survey was that for the first time since we began our analysis in 2014, at the UK’s largest companies there are no Black Chairs, CEOs or CFOs.”
- “Executive Director roles are lagging behind and have failed to increase Black executive leadership, which remains at 0.6%, unchanged over eight years.”
- “… we find that ethnic minority and female leaders are being sidelined in Non-Executive Director roles or functions that hold less influence and are less likely to lead to a C-Suite promotion.”
- “… where change is happening, it is often within the corporate sidelines – roles and functions which are far less likely routes into the top tier of leadership than those travelled by their white, male counterparts.”
Top 20 Executives and Non-Executives (Board and Executive Committee)
- While representation across all ethnic minority groups in the Top 20 marginally increased, Black leaders remain the least represented overall (1.6%), only a 0.3% rise since 2014. Amongst executive directors (as opposed to NEDs), the Black ethno-cultural group has made the smallest gain at 0.1% and remains the least represented group at 0.6%.
Top 40 Executives (Senior leaders who report to the Board and Executive Committee)
- The ‘Top 40’ “represents the internal pipeline of tomorrow’s senior executive and non-executive leaders.” Ethnic minority representation in the Top 40 has fallen backwards to 9.3% in 2021, compared with 10.7% in 2019. This is now lower than in 2018 (10.6%) and 2016-2017 (10.7%).
- Except for the Chinese and other Asian ethno-cultural group, which remains unchanged since 2019, all other ethno-cultural groups saw a decrease in representation throughout 2021.
- “At this level, our analysis of job functions also shows clearly how female and ethnic minority leaders are more likely to be sidelined into Human Resources and Marketing & Communications job functions; roles which are traditionally, less likely to lead to the top executive leadership spots than the white male dominated sectors of Digital, Data & Technology, Commercial & Procurement, Governance & Operations and Finance.”
New Financial Report: Accelerating Black Inclusion, April 2021 (link)
- A qualitative analysis focusing on the progression of Black professionals into leadership positions across the UK financial services industry.
- Just over half of the sample of more than 50 financial services firms made some kind of public statement within the two months following the death of George Floyd, but only a quarter committed to action, largely led from the US, indicating the unease of the UK corporate conversation on race.
- Black employees, particularly the few Black leaders, were called on to lead the corporate response, effectively taking on a second job. While they were willing to contribute, and benefitted from raising both their own profile and that of the Black inclusion agenda with senior leadership, the work was exhausting and the exposure was not without risk.
- Two-thirds of interviewees said they had experienced racism at work and for most, the incidents were subtle rather than egregious.
- Where racism and discrimination were acknowledged, interviewees rarely raised it at the time or reported it afterwards. Most did not feel their complaints would be taken seriously, and they tended to deflect with humour or ignore it. Many felt it was difficult to evidence such incidents, and that occurrences are largely written off as being personal between the individuals involved. When they did raise incidents with colleagues, there was a general assumption that the Black person misunderstood what was said or misread the situation. While each separate event may appear minor and can be shrugged off, a sense of injustice, racial trauma and exhaustion accumulates over time.
- A further layer of racism comes from unconscious or implicit biases, which effect what is and, crucially, what is not expected from Black colleagues, e.g. being perceived as a risk and as not marked out for success. “A manager might be happy to allocate a smaller task, but the higher profile complex work and promotions go to members of the in-group. This manifests in career stagnation, and Black employees languishing in support and administrative functions with little opportunity to move across into core front office roles.”
- The main thematic barriers to progression include striving to fit in; the consequences of the lack of representation of Black people and the related ‘tall poppy syndrome’, where Black professionals who reach senior positions face the risk of exposure and have to accept that everything they do is examined under a microscope; accusations of tokenism; and lack of affinity bias and familiarity with the unwritten rules to get ahead. The way these barriers overlap and compound each other make them uniquely challenging to Black employees in financial services.
The ‘Middle’ Report, 2nd Edition, Black British Business Awards (link)
A report on how to address racism and advance ethnic minority professionals at work
- “We asked HR Directors and D&I Practitioners how often their company board and executive committee receive management information about the progression of BAME talent in their organisations. Only 4.3% of HR and D&I respondents answered ‘always’, and 23.9% responded ‘often’. It is striking that 42% of HR Directors and 27% of D&I Practitioners did not answer this question concerning management information, suggesting that they may not know or may be unwilling to disclose the extent to which they share information with their senior leadership. This also raises the question of whether senior leaders either do not notice that they are not receiving information about the progression of BAME talent, or do not insist upon better reporting.”
Report on the Race Fairness Commitment, November 2021 (link)
A report on data collected from 35 UK law firms which are signatories to the Race Fairness Commitment
- Black and ethnic minority trainees account for 32% of the trainee population. However, “[a]ttrition for junior Black lawyers is significantly higher than for other ethnic minority and White lawyers. There are clear spikes in the attrition of Black lawyers at qualification, 1 PQE and 3 PQE. By 7PQE there are very few Black lawyers left, even when we accounted for there being fewer Black lawyers who joined the profession as trainees 9 years ago.”
- According to the Financial Times (21 Nov 2021), the report showed that “Across the 35 firms surveyed, there were fewer than 10 black fifth, sixth, seventh and eight-year associates. There were 543 white fifth-year associates, and 120 other ethnic minority associates in that cohort.”
Bar Council of England and Wales: Race At the Bar – A Snapshot Report, Nov 2021 (link)
- “Data in the report categorically and definitively evidences, in quantitative and qualitative terms, that barristers from all ethnic minority backgrounds, and especially Black and Asian women, face systemic obstacles to building and progressing a sustainable and rewarding career at the Bar… [and] particular inequalities are faced by Black barristers and students.”
- “Black and Asian women at the Bar are 4 times more likely to experience bullying and harassment at work than White men.”
- “Even when factoring in practice area, work volume, region and seniority, women earn on average less than men; Black men earn less than White men; and Black and Asian women earn less than Black and Asian men, and Black women earn the least. The income differentials vary between practice area but are significant.”
- “Black and Asian barristers are under-represented in taking Silk (becoming Queen’s Counsel). There are just 5 Black/Black British female QCs and 17 male Black/Black British QCs in England and Wales. There are 16 male and 9 female Silks of Mixed ethnicity. There are 17 Asian/Asian British female QCs and 60 male Asian/Asian British QCs. This compares 1,303 White men and 286 White women.”
- “It is clear … that candidates from ethnic minority backgrounds are less likely to obtain pupillage than candidates from White backgrounds, even when controlling for educational attainment [university ranking, BPTC grade and degree class].”
- “Data taken from the Bar Council’s CRM database indicates that, at all band levels, White male barristers earn the highest fee income. This is especially stark from the higher income bands – Band 5 to Band 8. Asian/Asian British males earn the most after White males and female barristers. Further breakdown can be seen in the table as follows which shows the percentage of the self-declared income in each band and how the income band is distributed according to ethnicity and sex. Each band is measured out of 100%.”
Breakdown of the 2021 self-declared income in each band by ethnicity and sex (%) as of 1 June 2021
In the six main practice areas (Crime, Family – Children, Family – Other, Commercial & Financial Services, Employment and Personal Injury), some have no QC representation from barristers of different ethnicities. The table below highlights the gaps in representation.
Number of non-QCs and QCs in the 5 main practice areas based on ethnicity and sex for 2021 as of 1 June 2021
Reboot. Report, Race to Equality: UK Financial Services, October 2021 (link)
A survey of mid-to-senior level white and ethnic minority employees in the financial services sector
- Employees in the financial services sector earn 29% more than the rest of the UK on average, excluding bonuses. However, around half (48%) of ethnic minority employees believe their career progression is lower than that of their white peers, compared with 12% of white employees who believe that theirs is lower than ethnic minority colleagues. Conversely, more than half (55%) of white employees believe their career progression is “about the same” as their ethnic minority peers, while 24% and 9% say it is higher or significantly higher, respectively.”
- The data to paint a complete picture of the makeup of the UK’s financial services sector does not currently exist. Accurate data on representation within the industry provides much-needed context on a range of issues, including the ethnic pay gap, and allows for a more focused view of the experiences of specific ethnic groups. The experiences of ethnic minorities are not uniform and data should be reflective of that.
- The findings of the survey confirm that traditional concepts of ethnic minorities facing a ‘concrete ceiling’ have been replaced with the notion of the ‘labyrinth’, i.e. “the continuous difficulties, complete with dead-ends and complexities, faced by minority groups in achieving the end goal of a senior leadership role”.
- Ethnic minorities are more represented at entry-level roles for most financial services organisations, but struggle to navigate to senior leadership roles.
- White peers identify organisational culture as the most common barrier to progression for their ethnic minority peers, showing recognition for the constraints existing corporate structures place on their colleagues.
- Regarding factors that help employees with career progression, a greater diversity of people at senior levels was identified as a key factor by both white and minority ethnicity people.
- Of those surveyed, eight out of 10 white peers think it is important for their organisation to have a more diverse workforce. White respondents identified a range of benefits behind a more diverse workforce, including a greater variety of perspectives and access to more talent. Additionally, one in four recognise the reputational boost a company may experience by embracing D&I.
- “Seven in ten financial services organisations have policies on D&I yet only one-third (36%) of financial services employees believe their companies are “fully committed” to enhancing D&I, suggesting that while efforts have been made to address the issue by the boardroom, there needs to be a more open dialogue with ethnic minority employees in terms of what they want, as such, long-term positive results are yet to materialise across the sector.”
Tech Nation: Ethnic Diversity in UK Fintech, October 2021 (link)
Report by UK Government-sponsored tech network into the role and participation of ethnic minorities in UK fintech
- Ethnic diversity in fintech has increased from 12% in 2011 to 20% in 2021. However, the proportion of Black people working in fintech has remained static, at 3.1%, while the proportion of Asian people, and people from other underrepresented groups has increased.
- The earlier the stage a fintech company, the more diverse its workforce. Seed stage companies have approximately 15% representation in the workforce of Black, Asian and other underrepresented groups, whilst exited companies have 9%. The proportion of Black, Asian and other underrepresented groups declines with each stage of company growth.
- Of the early careers population, 77% were White, 12% Asian and 3% Black. The population with 5 to 10 years of experience rose to 81% White, 10%.
- Asian and 3% Black. With 10 to 15 years of experience, combined ethnic minority representation fell to 11%, and with more than 15 years of experience, it fell further to 8%. “This implies the proportion of underrepresented groups drops from early careers to senior executives and C-suite populations.”
- Black, Asian and other underrepresented groups are marginally more likely to have a degree than White people working in fintech.
- Black fintech employees are most highly represented as a proportion of all employees within a function in HR (4%) and Asian employees are most highly represented in IT & tech (12%) and finance (12%) as a proportion of all employees in those functions.
Bank of England Review of Ethnic Diversity and Inclusion, July 2021 (link)
- While the Bank has also attracted an ethnically diverse pool of experienced-hire applicants, there is a ‘leaky pipeline’ in recruitment: the share of minority ethnic candidates fell substantially between application and appointment.
- “After joining the Bank, White colleagues have tended to receive higher performance ratings. They have also typically been afforded greater opportunities for career development and progression than minority ethnic colleagues. Promotion rates for White colleagues, particularly those in more junior roles, were also generally higher than for minority ethnic colleagues. The level of pay and pay rises were equivalent for White and minority ethnic colleagues at the same pay grade. However, bonuses (measured as a percentage of base pay) were on average lower for minority ethnic colleagues than White colleagues. Most, but not all, of this bonus gap could be accounted for by lower performance ratings.”
- The inequitable allocation of opportunities tends to negatively impact other employee life-cycle outcomes, such as promotion rates and the likelihood of leaving the Bank. There is evidence for a dynamic at the Bank similar to the one in the Figure below.
“These findings for performance ratings, pay, promotion rates and resignations were common across all minority ethnic groups. There were however some pockets of differences for Black colleagues. Across both the Graduate Scheme and experienced hires routes, the Bank attracts relatively fewer candidates coming from Black or Black heritage backgrounds relative to their representation in the population compared to, for example, minority Asian applicants. Black colleagues were also more underrepresented relative to other minority ethnic groups among those receiving a subset of the high-profile or career-advancing opportunities in the Bank.”