Employers must review progress on race and ethnicity commitments

The tragic murder of George Floyd in the US in 2020 and the subsequent growth of the worldwide Black Lives Matter movement accelerated the conversation about race and inequality in the workplace. But, perhaps in the face of financial pressure caused by the war in Ukraine and the Covid-19 pandemic, alongside the current cost-of-living crisis, many organisations are finding that progress has stalled.

Firms should honestly review what improvements, if any, they have made against the targets or goals that they initially set in relation to racial equality. Where the information is held, they should use data and analytics to keep their efforts on race and ethnicity inclusion current.

Reputational risk

Organisations of every size and from every sector of the UK economy must redouble their efforts on race and ethnicity inclusion to remain at the forefront of the issue and to actually champion any change. The difficulties faced by those from minority ethnic backgrounds have not lessened and companies that fail to address this risk real and justified reputational damage. In a tight employment market where there is a race for talent, tackling inequality in the workplace is essential to allow firms to recruit the very best candidates and to retain their best employees.

A company’s prior commitment to diversity and inclusion (D&I) goals do not go unnoticed by its workforce. Promises that are not subsequently delivered can damage staff engagement and impact on trust in the employment relationship more widely. Companies must hold themselves to account, because if they do not, others will and will do so in a very public way.

Using data to improve inclusion

Increasingly, firms are focusing on D&I as part of a wider effort to improve their environmental, social and governance (ESG) policies. This approach can help keep D&I at the centre of attention at board level, but demonstrating success requires the appropriate use of data. Without it, board members will struggle to get a sense of whether progress is being made – and in what areas. Data allows firms to show how far they have moved the dial.

Diagnostic tools

As a first step, employers can use a maturity assessment diagnostic tool to understand where they are on their D&I journey and examine different criteria to highlight particular areas where change is most needed. Diagnostic tools can also look for ‘acceleration points’ within a company – structural reforms that would allow it to move faster to improve inclusion.

Pay gap assessments

Some organisations are already carrying out voluntary ethnicity pay gap assessments. While such assessments are not currently mandatory, the government is expected to introduce requirements for them soon. Proactively conducting pay gap assessments means an employer can stay out in front of regulatory reforms and design effective initiatives to improve D&I.

There are targeted programmes that employers can build using data gathered from ethnicity pay gap assessments. Reciprocal mentoring, for example, partners individuals from minority ethnic backgrounds with white staff in senior leadership roles, giving the latter a better insight into the development needs of the former.

Continuous improvement

Ultimately, employers must understand that improving D&I is a continuous process, rather than a problem that can be solved through a short-term period of heightened focus. Instead, firms must employ the tools available to them to monitor their progress over time, for example using data to inform their decision making or run ‘employee pulse’ surveys, and to ensure that D&I efforts do not fall off their radar or become outdated.

When employees, board members or job applicants ask for proof of an employer’s commitment to race and ethnicity inclusion, an information-backed, evolving and organisation-specific D&I strategy is key. That strategy will then lead to initiatives that embed real, effective and lasting cultural growth.

Written by Shuabe Shabudin and David Shields of Pinsent Masons.