If you take a walk through the Square Mile’s streets you will see people coming together from a range of backgrounds, and will hear a vast spectrum of accents and languages. This diversity and openness are major assets for the City. They help create a melting pot of different ideas, encouraging innovation and an entrepreneurial spirit. Yet, much more still needs to be done, to ensure a level playing field for all.
Fewer than one in ten management roles in financial services are held by black, Asian, or other ethnic minority people and research last year found that employees from less privileged socio-economic backgrounds take 25 per cent longer to progress through each stage of their careers, with no link to performance.
Related research by the Social Mobility Commission shows that people from working class backgrounds in professional jobs earn on average £6,000 less a year than colleagues from more privileged backgrounds, with UK employers favouring polish over performance.
Clearly, we need to work to ensure that talented people from diverse backgrounds can not only get their foot on the corporate ladder, but also climb to its top rungs. That is what the Socio-Economic Diversity Taskforce – commissioned by the Government and run by City of London Corporation – is aiming to achieve. Data collection and setting targets will be a major part of this effort.
It’s not easy or quick to drive change, but we’ve seen advances in other areas – for example in the proportion of women on boards and executive committees since the Treasury launched its Women in Finance Charter in 2016. Results show signatories to the charter surpassing their non-signatory peers significantly when it comes to delivering gender diversity at the top.
Target setting and measurement may not give us a “silver bullet”. Still, they are vital mechanisms to track progress.
The Socio-Economic Diversity Taskforce is working with businesses to ensure that the financial and professional services sector provides equal opportunities for everyone. KPMG recently took a bold step by announcing a target for the proportion of its partners and directors to come from working class backgrounds. PwC also recently announced their class pay gap. My hope is that other employers will follow this lead.
It is vital to engage with employers to identify ways to put an end to an unjust pay gap which is sadly still present.
Last week the Department for Opportunities launched “Class Polish”, a new campaign aimed at doing just that, by calling on employers and Government departments to measure, report and close their Class Pay Gap. The Government should include similar measures in its forthcoming Levelling Up White Paper.
There is real momentum for change and we must seize this through the work of the taskforce, through our industry consultation and our productivity analysis, to build that all-important business case and take steps which will drive change.
While it is true that the adage “what you can’t measure you can’t manage” is an oversimplification, it is even more true that to address a problem you need to know its scale.
Data, measurement and targets will be key tools to find a solution. Success and progression in the City should depend on performance, not background.