Over the last 12 months we have seen an increased focus on diversity and inclusion across society, and particularly within the workplace. Increased scrutiny in this area has stemmed from the Coronavirus pandemic, the Black Lives Matter movement and the Parker Review, all of which have brought diversity and inclusion to the attention of the Board.
Diversity in the workforce has proven to improve profitability, business performance and morale. Fair and equal practices in the workforce are simply the right thing, for everyone. At Berwick Partners, we have spoken with numerous business leaders across several sectors to understand their plans to address the issue, increase their diverse talent pools, and the issues they need to overcome.
The Consumer Sector
Across the consumer sector it was clear that the importance of diversity and the need to address the issue had strong support from leadership teams. D&I is increasingly becoming a talent attraction and retention issue. To date, gender is the area most focused on, with the real breakthrough moment being Gender Pay Gap Reporting. Most companies we spoke to have made good progress in redressing the gender balance for leadership positions.
Larger companies have started addressing diversity more broadly. For others, the Black Lives Matters movement pushed aspects of diversity further up the agenda, moving the conversation beyond gender. Not many businesses have set targets, but most have developed an inclusion strategy and/or included D&I in their values to increase the focus and bring it into conversations more regularly.
The Healthcare Sector
Within the healthcare sector, the Coronavirus pandemic has highlighted inequalities more than ever, with a distinct need to support staff from ethnic minority backgrounds to develop further in the sector. There are initiatives in place in some organisations, including implementing a D&I strategy and appointing a D&I lead to the trust board specifically to lead on this. The resounding view is that more needs to be done and, positively, there is a real commitment and appetite to change. The business leaders we spoke with were very open about their training requirements and felt there was a need to improve insight and awareness in this area. The sector needs to focus on supporting ethnic minorities in their progression above middle management positions.
The Not for Profit and Charities Sectors
All the organisations we spoke to strongly agreed that diversity was important and matters to their business, but were also universal in their agreement that they were not happy with their current level of diversity. Across the Arts, Culture and Heritage sector the level of diversity within organisations did not reflect the level of diversity found within the wider society or the communities they served.
It was agreed that the sector requires a step change in how it attracts and selects staff, through creating more diverse talent pipelines for organisations and the wider sector, using apprenticeships, internships and secondment programmes. The need to speak to school age children about the careers that are available within the sector was highlighted, to educate individuals on the huge variety of roles and opportunities.
Many organisations are introducing agile ways of collecting, analysing and responding to feedback, continuing to encourage dialogue between staff at all levels and strengthening their staff networks. It was agreed that this commitment to people can only be achieved by leaders at all levels taking ownership and action to enable this to happen for their people and teams. Leaders and managers will need to have support to play their part in creating a culture and environment in which they and their teams can thrive.
The Manufacturing Sector
Most of the businesses we spoke to acknowledged the importance of diversity and were dissatisfied with their levels of diverse talent, however, it is not currently their top strategic priority. Their recruitment efforts do not support a diverse culture and the focus is on attracting the right capabilities, especially in engineering.
Typically, the cultures are very traditional across the industrial space and these organisations admit they are at the beginning of their D&I journey. They have no strategy, targets or change management programme in place and little accurate visibility of internal diversity statistics. There is consistency with virtually no females or younger individuals on leadership boards. A focus on development and training is required to initiate change in the mindsets of leadership teams.
The Social Housing Sector
The message was consistent across all the businesses we spoke to, without exception. Diversity and inclusivity are important but tackling this is still seen as a big challenge. At an operational level, most organisations feel they represent the communities they support, but this representation decreased dramatically when looking at the executive team. Post-pandemic, all businesses expect to return to the office under a more flexible regime, with this giving an opportunity for businesses to consider more diversity when hiring. Systems are in place to ensure a fair recruitment process, with most commonly requiring adherence to the ‘Rooney’ rule.
The Media Sector
The media sector appears to be extremely vested in this area with a lot of very positive initiatives taking place. Whilst positive progress has been made, many feel there is still a lot of work they need to do. They appear to be ahead of other sectors in having identified how they make positive changes, with a defined strategy and commitment from most CEO’s in improving D&I.
One organisation is in the process of launching sponsorship programmes for women and BAME talent. They have ensured the leaders of their business undergo regular training in this regard and believe the D&I agenda needs to cascade down from the leadership team. Improving awareness at leadership level has helped the business adapt its thinking, committing fully to the belief that a diverse and ‘inclusive’ workforce provides them with commercial advantage and innovation, an engaged workforce, an improvement in well-being and, most importantly, is the right thing to have.
The Public Sector
D&I is a key strategic theme for organisations/departments, partly due to central Civil Service targets, goals and priorities. However, a number also recognise that there are moral, ethical and compliance drivers as well as better outcomes in delivery terms. The tools already being implemented to help the sector reach its targets include industrial placements, apprenticeships and recruitment procedures and materials to help those such as neurodiverse/disabled applicants. It was almost unanimously agreed that there is a shortage of talent, and those involved in recruitment processes need more training.
The Finance Sector
Whilst diversity is clearly very important to the businesses we spoke to, they remain unrepresentative of the communities they serve. Circa 20% of the leadership teams are diverse within the sector, with the statistic mainly coming from redressing the gender balance. The reason for this was cited as a shortage of talent which makes it through to leadership positions; a focus needs to be placed on the talent pipeline. Mandatory targets are ineffective if there is no talent pipeline, and it doesn’t address inclusion issues. Many businesses are increasingly looking outside traditional candidate pools/their sector to hire diverse talent.
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