At a time when racism and bigotry are making headlines, a report showing a sudden climb in the number of people from ethnic minorities in top City management jobs holds special significance.
Yes, a report published today shows ethnic diversity in leadership positions at FTSE 100 companies has reached a four-year high. Take that, Trump.
But though the figures are encouraging, they cannot hide the fact a lack of diversity, not just on boards but right across the strata of management, continues to be a thorn in the City’s side. While firms have made strides bringing women into top roles - between 2010 and 2015, there was a 137 per cent increase in the number of women on FTSE boards - progress for the black and minority ethnic workforce is much slower.
Figures published earlier this year by Baroness McGregor-Smith, the former chief executive of Mitie, underline this. Her Race in the Workplace review showed while 10 per cent of the UK’s workforce is made up by those with black and minority ethnic backgrounds, just six per cent have reached the top of the management tree. It also suggested improving progress for people from minorities could add £24bn, or 1.3 per cent, to UK GDP.
Meanwhile, research by Hermes Investment Management suggests investors are increasingly looking for an array of experience among board members: 30 per cent placed a particular importance on racial diversity (up from the year before), while 19 per cent said they valued a mix of socio-economic backgrounds. Even Warren Buffett has waded in on the subject, saying diversity is “critical” to a high-functioning board.
The challenge for those attempting to solve this is that, unlike with the gender issue, there is no definable moment when minorities suddenly vanish from the workforce: there are no babies to blame. It is more nuanced than that - partly due to candidates’ educational backgrounds, partly to do with unconscious bias from hiring managers. Occasionally, it is still due to lingering prejudice.
But time is also an factor. The people joining the senior echelons of FTSE 100 companies now may have joined after those firms implemented diverse hiring policies five or 10 years ago. Their progression up the ranks confirms the old adage: the first step to solving a problem is recognising that there is one.