Building a better business through diversity and inclusion
26 August 2020
Since the introduction of mandatory gender pay gap reporting in 2017 there have, rightly, been calls for similar regulations to help address the ethnicity pay gap.
In light of several shocking events over the last few months, conversations about diversity and inclusion are happening more often. The groundswell of support for the Black Lives Matter movement has pushed the call for change further up the agenda. Introducing ethnicity pay gap reporting is a very tangible way for employers to ‘walk the walk’ on diversity and inclusion matters. It will allow them to measure progress and drive meaningful change.
At the time of writing this, an online petition lobbying the government to introduce mandatory ethnicity pay gap reporting in larger organisations has reached over 130,000 signatures. The government has already run a consultation on this topic and are due to respond by the end of the year.
Who’s doing it?
Many businesses have already taken the lead, with some reporting their ethnicity pay information for at least two years. Our colleagues at Deloitte have been voluntarily publishing their ethnicity pay gap data since December 2017. Their continued focus on improving representation of ethnic minorities at all levels of the business has helped deliver a smaller median pay and mean bonus gap in 2019 (7.9% in 2018 to 6.7% and 45% to 42.9% respectively)
In 2017, a government-backed review recommended that Britain’s biggest companies should have at least one person from an ethnic minority background on their board by 2021. Some within the FTSE 100 such as Barclays and HSBC have a truly diverse board, both in terms of ethnicity and gender. To date though, many still don’t. To be precise, as of December last year, 47% of FTSE 100 companies have no ethnic minority representation at board or executive committee level.
Why do it?
By reporting and publishing your ethnicity pay gap data you’re visibly taking steps to ensure your organisation is tackling barriers ethnic minority people face in recruitment and career progression. You’re demonstrating a willingness to confront the issue of representation head-on and make it a priority for your business. For companies, it’s not only a matter of fairness to ensure opportunities are there for people of all backgrounds, it’s also a creative and commercial imperative.
Reporting on your ethnicity pay gap will be a springboard to talk actively about race and ethnicity in the workplace. It’s important that all employees feel seen and heard. Having open discussions about your ethnicity pay gap will be vital to delivering meaningful change. Even if your initial figures make for uncomfortable reading, the fact they are visible will encourage action.
How to prepare
Whenever and, just as importantly however, the government decides the data should be reported, there are a number of things you can do to begin addressing potential ethnicity pay issues within your organisation.
- Appoint senior leaders who will drive conversations about ethnicity at board level, keeping it at the forefront of company thinking
- Offer inclusive leadership training for managers and directors as a key part of talent development programmes
- Engage senior leaders in reverse mentoring and reverse coaching
- Make diversity and inclusion a standard item on board agendas to ensure regular review of performance against targets
- Create diversity allies, a network of individuals who are able to support under-represented employees by giving them a voice at board level.
Take action which shows you are being open and transparent on the matter; action which demonstrates your commitment to implementing initiatives that will drive positive change in behaviours and results.
Delivering the message
Here at Stitch we’ve been helping our clients communicate gender pay gap information to employees for a few years now. Key to delivering those results effectively has been ensuring the data is presented in a clear and transparent way, demonstrating a tangible commitment to improve.
When delivering your ethnicity pay gap results to employees the thinking should be no different.
- Acknowledge the importance of the topic – include a message of endorsement from senior management
- Give the subject online prominence. Consider publishing your results on a public facing website as well as your intranet
- Ensure the key data is presented clearly and explained well – a branded and engaging animation is especially effective
- Show evidence of the initiatives you have in place to drive change
Delivering a suite of innovative and engaging communications to your employees that show you are invested in addressing your ethnicity pay gap will be a big step towards improving your results.
Get in touch if you want to discuss ways we can help deliver your ethnicity pay gap data in a way that will enlighten, educate and motivate your employees.