Business Sector is Failing Diversity
A recent report released by Green Park has exposed the failing diversity across the business sector, as the number of ethnic minorities and women gaining leadership has become a growing concern.
Despite a campaign by former business secretary Vince Cable to encourage at least one non-white director by 2020, there is still a decline in the number of diverse managers being promoted for the boardroom. While women are maintaining a steady growth in the competition for leadership, the ethnic diversity of those within FTSE 100 companies is nose diving at a drastic level.
Women now comprise 12.6% of executives, and hold 27.9% of non-executive positions, but little has really changed at board level with an increase from 18.7% from last year’s 18.2%. It’s a slow and steady rise of women at Top 20 and Top 100 positions, and although it offers some encouragement in the case of gender, there is still something of a pipeline for women to be able to gain more executive roles. As women continue to feature disproportionately as non-executive board directors, the true level of influence is far smaller than the numbers suggest.
“Regardless of the focus on increasing diversity within the UK’s FTSE 100 to help businesses become more competitive around the world, the research that has been found clearly illustrates that companies are getting less ethnically diverse rather than more in the past year,” Raj Tulsiani, chief executive of Green Park explained to The Guardian.
As discovered by the report there are no ethnic Chinese or Asian executive directors in the FTSE 100, even though there is a significant importance for businesses to embrace Asian economies as trading partners. In total the FTSE 100 lost the equivalent of 40 if its 480 non-white leaders, whilst the number of all white boards has grown by 11%.
Britain’s “widening diversity deficit” is putting the UK’s companies at a huge disadvantage when it comes to doing business on a global scale, as the deeper understanding of diversity is a tool that can develop a company’s growth.
Talent management is the only way forward to encourage the employment of the most successful educational demographic in the UK as it genuinely brings people of different outlook, experience and culture to the table.
The Financial Reporting Council has indicated that next year, the definition of ‘diversity’ should be expanded to include ‘and race’ in the UK Corporate Governance Code, which will have a momentous impact on reinforcing diversity including race and encouraging a future-proof workforce. Employers need to ensure that their performance and appraisal processes are fair and transparent so that all staff have equal opportunities for career progression.
Big companies now need to ask themselves why they are not drawing on some the most talented minorities that could provide them with a competitive edge.