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Finance industry urged to hire more working class managers

Economy Aug 11, 2022 01:56
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© Reuters. FILE PHOTO: Catherine McGuinness poses for a photograph in London, Britain, January 17, 2018. REUTERS/Hannah McKay

By Huw Jones

LONDON (Reuters) - Financial services companies should set "stretching targets" for appointing people from working class backgrounds to senior positions, a UK government-sponsored report said on Thursday.

The finance industry is already making efforts to appoint more women, Black and ethnic minorities on to boards and into roles like chief executives and chairs but targets for socio-economic background have featured less in corporate diversity efforts.

A taskforce commissioned by the government and led by the City of London Corporation surveyed more than 9,000 employees across 49 financial and related professional firms and found the sector is out of kilter with society.

The taskforce said that 49% of all levels of seniority in the finance industry were from a professional background, rising to 64% for senior leaders. For the UK population as a whole, 37% of working people are from a professional background.

Socio-economic background can amplify other inequalities, particularly related to ethnicity and gender, it said.

Working class employees, who are also female or an ethnic minority, are even less likely to hold senior level positions and less likely to feel included in the workplace.

White men from a professional background account for 45% of senior roles, compared with 23% for their female counterparts while just 13% of senior roles are filled by white men from working class families.

The survey defined working class as having a parent working in a routine and manual occupation, such as receptionists, van drivers, plumbers and electricians.

(Graphic: Graphic on Socio-Economic Diversity, https://fingfx.thomsonreuters.com/gfx/mkt/akvezkmbypr/Graphic%20on%20Socio-Economic%20Diversity.PNG)

The lack of inclusion of people from working class backgrounds poses a risk to employee retention and productivity in what is already a tight UK labour market, the taskforce report said.

"This data provides a robust baseline by which the sector can begin to track its progress on socio-economic diversity and address gaps," said Catherine McGuinness, who chaired the taskforce.

"We urge firms to collect data, set stretching targets and ensure they provide a level playing field for all."

The report urged firms to join, Progress Together, launched in May and which sets out best practice guides and benchmarking to drive changes in socio-economic diversity.

Accountants KPMG became one of Britain's first companies to set a target for staff from working class backgrounds to help close a pay gap and diversify its staff.

Finance industry urged to hire more working class managers
 

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