Investment banks are failing to hire working-class people – as well as those who wear brown shoes.
A new study out today from the Social Mobility Commission reports that investment banks favour middle to higher-income candidates from the country’s top universities.
The researchers, from Royal Holloway University of London and the University of Birmingham, also noted the importance of dress codes in the City.
Brown shoes and "loud" ties were identified by some as no-go areas.
Read more: Most people still identify as working class
The Social Mobility Commission said its researchers had found managers had opted to hire people in client-facing roles who fit the "traditional image" of an investment banker.
"Some still place as much importance on an individual’s comportment (speech, accent, dress and behaviour) as on their skills and qualifications," it said.
They note that this can disadvantage candidates whose upbringing and background means they are not aware of ‘opaque’ city dress codes. For example, some senior investment bankers still deem it unacceptable for men to wear brown shoes with a business suit.
One interviewee from a non-privileged background told the researchers:
He said you interviewed really well. He said you’re clearly quite sharp, but . . . . you’re not quite the fit for [this bank] . . . you’re not polished enough . . . he looked at me and said, “see that tie you’re wearing? It’s too loud. Like you can’t wear that tie with the suit that you’re wearing” . . . what kind of industry is this where I can be told that I'm a good candidate, I'm sharp, but I'm not polished enough?
Brown shoe complexities
Exploring the brown shoes topic further, the researchers noted that they are "generally (though not always) considered unacceptable by and for British bankers within the investment banking (corporate finance) division".
However, in continental Europe brown shoes are "permitted" among M&A bankers.
The report added: "Yet a further qualification is that some bankers in corporate finance may ‘get away’ with wearing brown shoes perhaps, for example, if they are sufficiently senior."
The report examined social mobility barriers in investment banking and life science professions, finding people from the most privileged backgrounds are over-represented.
Alan Milburn, chair of the Social Mobility Commission, said:
Bright working-class kids are being systematically locked out of top jobs in investment banking because they may not attend a small handful of elite universities or understand arcane culture rules.
While there are some banks that are doing excellent work in reducing these barriers, there are still too many that need to wake up and realise that it makes sound business sense to recruit people from all backgrounds.
It is shocking, for example, that some investment bank managers still judge candidates on whether they wear brown shoes with a suit, rather on than their skills and potential.