Seven in ten ethnic minorities in financial services firms have experienced discrimination at work in the past year, a new report has said.
The second edition of the Race to Equality in UK Financial Services report by Reboot, released today (December 5), showed that 82 per cent of ethnic minorities have experienced unwelcome comments based on their background this year and some businesses are not dealing with this effectively.
A quarter of respondents, 800 people working in financial services roles with a minimum of ten years’ experience, said they believed that racial jokes are still tolerated in their workplaces.
Furthermore, 47 per cent said they have raised issues around discrimination with their HR team, and three-quarters said they did not think the department was effective dealing with these issues.
Those who experienced discrimination said they also came under greater scrutiny with mangers and 48 per cent said colleagues treated them differently after speaking up.
Director of investment stewardship research at Morningstar, Lindsey Stewart, said in the current “war for talent”, many financial services firms are still turning up unarmed.
“Creating an inclusive culture is a key talent retention factor, a strategic advantage, and a governance imperative,” she said.
Oliver Bilal, head of EMEA distribution at Invesco, said the industry should take these findings very seriously.
“An equal opportunity to progress is not only morally right, but a cornerstone of good business practice and key to creating a dynamic, productive workplace,” he said.
He added that while there may be agreement on the nature of the problem, it will only be solved through action and accountability.
“In our view, equality of opportunity should be embedded in the institutional structure of an organisation, which is why we advocate tying diversity and inclusion progress to the annual performance goals of senior leaders and their teams.”
The research found this is having a direct impact on businesses with almost half (49 per cent) of those respondents experiencing discrimination over the last year stating they had to take time off work and a similar number have had to seek counselling to help recover from all the negativity in the workplace (56 per cent).
Co-chairperson, race and ethnicity workstream at Diversity Project, Dimple Mistry, said: “There is a call to action for all HR professionals to come together, educate themselves and create safe channels for staff to approach them, and for matters to be taken seriously when raised.
“I recognise that this is a journey that does not stop, this requires us all, no matter what your background, to come together to consciously work towards creating a truly inclusive industry and workplace cultures that enable professionals from an ethnically diverse background to feel a strong sense of belonging and thrive wherever they are.”
The research also revealed that almost half (44 per cent) of ethnic minorities said the speed of their career progression has been slower than that of white peers. Furthermore, one in three (32 per cent) respondents felt they do not have the same opportunities as white colleagues.
A lack of senior representation is preventing ethnic minorities progressing at work and prompting them to switch jobs, the report explained.
For instance, four out of ten (40 per cent) ethnic minorities said that they are likely to search for a new role in the next six to 12 months, with one in 10 (9 per cent) of these people blaming their organisation’s discriminatory culture for a potential move.
This is something that appears to be on financial services firms’ radars as half (46 per cent) of leaders recognise that the lack of ethnic minority role models within their organisation hinders career progression.
Call to Action: Reboot Three-Point Plan for Financial Services Organisations
While some areas of diversity and inclusion within the financial services industry have improved over the last 12 months, more still needs to be done to help ethnic minorities feel comfortable and progress their careers at the same rate as white employees, it said.
The latest report shows that organisations need to work on their ethnicity pay-gap, their human resources departments, and their career progression opportunities, for the benefit of all employees. Reboot has provided financial services businesses with a three-point plan:
- Challenge negative office cultures: Poor attitudes in the workplace are still hindering progression. Racism has no place in the modern workplace, and it is telling that ethnicity-related jokes are still heard in offices across the industry. These behaviours need to be challenged with a zero tolerance policy if we are to create a safe and inclusive working environment for those of every background.
- Leaders take charge: To remove barriers to progress, leaders have to set the tone and not outsource diversity and inclusion. By championing the cause from the top and sponsoring talent to develop within the business, it will help create more senior role models and an environment where all employees feel comfortable to talk about race, just like we have observed with gender diversity.
- Close the gap and be transparent: Three quarters of people (76 per cent) surveyed believe ethnicity pay gap reporting should be mandatory. More transparency on ethnicity data reporting will therefore mean companies will have to become more accountable – and this will help build a sustainable roadmap. Furthermore, organisations that can show that they are fair will be more attractive to employees, customers and investors.
Noreen Biddle Shah, founder of Reboot commented: “This year’s results are concerning – from the amount of discrimination ethnic minorities are experiencing, the lack of representation in senior roles, to a continued discomfort to speak about race in the workplace. We need to understand the issues raised in the latest report so that we can work together to drive positive change and create more inclusive working environments for people working within the financial services industry.
"It is fair to say most individuals believe in a fair and diverse workforce, but the systems in which they operate are flawed and we need to find a way to make real changes and measure the impact. We also need allies and leaders to speak up to help normalise what is still sadly so taboo.”
sally.hickey@ft.com
