- Black people are 12-times less likely to be Executive Directors in the UK’s biggest companies than their percentage of the population would suggest, and make up only 1.5% of boards and 0.4% of execs
- The problem is even worse than in the US, with Black people in the UK more than five-times less likely to be represented on boards – and less than eight-times as Executives – than their US peers
- A skills-based, inclusive and fresh approach to recruitment can rectify these biases and improve performance by drawing on overlooked talent
Research published this week shows just how impenetrable the glass ceiling is for Black people in the UK’s largest companies. Figures released by inclusive recruitment specialist Ruebik and Operation Black Vote reveal that just one in 200 of FTSE100 Executive Directors are from Black communities, with them 12-times less likely to be represented at this level than the overall population.
The figures show that only 9.2% of the blue-chip FTSE100 board members are from the broader Black, Asian and ethnic minority (BAME) community. Given that 13.8% of the UK population is from a minority ethnic background, that leaves these communities underrepresented by about one-third. At Executive level, disparities are more extreme, with only 7% BAME representation (see Fig 1, below).
This situation is thrown into starker relief by the fact that these firms are largely headquartered in London, where 40% of the population is BAME, indicating an ignored pool of talent right on their doorstep. Taking London as the base population, rather than the UK overall, members of BAME community would hold more than 450 seats on FTSE boards; of the execs, just over 400. Instead there are 89 and 67 respectively.
There has been little progress towards having at least one ethnic minority representative on each FTSE board by 2021, as recommended by the Parker Review Committee, chaired by Sir John Parker of the Department of Business, Energy & Industrial Strategy in 2017. An update February 2020 found that 37% of boards (31 out of 83 companies surveyed) still had no BAME representation. This is in line with Ruebik/OBV data demonstrating that 34% of FTSE boards have no BAME members.
Source: Ruebik and Operation Black Vote
However, the Ruebik/OBV research provides a more granular insight than the Parker Review, which didn’t look at the more extreme underrepresentation of Black people. Black people make up 3.3% of the population, but only 1.5% of boards and 0.4% of execs – of which, Black women are just 0.1%. Black people are therefore 12-times less likely to be represented at exec level.
UK blue chips trailing US on progress of black leaders
While the US’s chronically dysfunctional race relations have been, after Covid-19, the main global news story this year, the UK scores even worse for representation of Black people at senior blue-chip level. In the US, Black people only have 73% and 37% of their ‘fair’ weight on boards and Execs respectively: however, in the UK those figures are just 18% and 12% (Fig 2).
The higher up the corporate ladder one goes, the less diverse, whiter and more male it becomes. Not only is this inegalitarian, argues Ruebik, but companies are overlooking a vast untapped reserve of diverse skills that would otherwise enrich a business’ capabilities.
The biases that people from minority backgrounds face continually were exemplified by the comments in June by Wells Fargo CEO Charles Scharf, that the bank had trouble reaching its diversity goals because there “was not enough qualified minority talent”.
Leading corporate sector veteran Lord Hastings commented on the significance of this information for the services:
“This fresh data underpins the imperative businesses now face to stop writing business cases for Black inclusion and to just get on with including more Black people in the professional opportunities they present.
At a time where economic outlooks could not be more turbulent, optimising ourselves for success is not a nice to have. Ruebik offers all organisations a rare chance to break down these barriers that have until now held so many back.”
Lord Woolley further explained why we need to radically rethink how we are involving and elevating Black talent if we are to see any change:
“This research paints a stark picture for the prospects of Black talent in the UK. The fact that you are at a significant disadvantage to succeed if you stay on home soil, means as a Black professional you are more likely to leave the country to get ahead. Therefore, Britain is at great risk of haemorrhaging the very diverse talent and skills that are needed to help us through this deeply challenging time.
“We already send our movie stars to the US in order to succeed. We should learn from our mistakes to ensure business doesn’t continue following suit.”
Ruebik CEO Christina Brooks explained the company’s distinctive approach:
“Ruebik offers businesses the right skillset, not performative ‘the right thing to do’ hires. We exist not because companies just need more diverse employees, but because companies are setting up diverse talent to fail by trying to attract and retain it in the same way as those who are systemically included. If you keep doing the same thing, drawing on the same narrow cohort of people, you will get the same results. And those results aren’t solving the problems that face today’s businesses.”
Alongside a unique approach to executive search, Ruebik offers a range of services, including executive coaching and onboarding, inclusion consultancy and is taking a lead in important thought leadership programmes and thinktanks addressing these issues, such as The Lion’s Share and Race On.
Now is the time
While blue chips show a deficit of Black talent, they are also reliant on the importing Black leaders from markets such as the US and South Africa, rather than nurturing the considerable domestic skills base drawn from local BAME communities. This shows that the existing recruitment model is more than wasteful – it’s broken.
Today, in the context of the questions posed by the latest wave of the Black Lives Matter movement, and how businesses are strategically and structurally rethinking as a result of Covid-19, society stands at a crossroads. There has never been a more opportune time for businesses to address these issues. As Christina says:
“At a time when organisations are seeking to ‘build back better’, Ruebik offers a way to achieve this centred around inclusive opportunity for all.”
This data covers a broad spectrum of organisations, chosen because they are largest in the UK and the USA as dictated by their position in the FTSE and the Fortune indexes. Gender has been categorised in binary ‘sex’ terms, meaning does the Leader in question present as male or female. BAME (Black, Asian and Minority Ethnic) has been categorised by UK standard terminology and excludes those from a Hispanic background as sometimes seen when BAME is referred to in an American context.
In our findings, we have summarised data based on the gender and ethnicity of company executive and board members. In order to ascertain ethnicity and gender, we reviewed multiple data points against each individual analysed. This included, but was not limited to, company websites, Wikipedia, the Wall Street Journal, Bloomberg and BoardEx online company listings. We examined historic reports on ethnicity and gender including The Parker Review, The Colour of Power and The FT Global Diversity Indexes. We also looked at schooling records, blogs and media coverage and outlets focusing on narratives from BAME leaders.
To the best of our assessment and knowledge, figures cited above correct as of 12 October 2020. This methodology has been used previously when identifying people for and publishing The Colour of Power, The Leadership Diversity Indexes and The FT Ethnic Minority Leadership Lists.
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