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Almost six in ten of the U.K.'s biggest companies have no board members from ethnic minority backgrounds, new research has claimed.
In a U.K.-government-backed report published Wednesday by consultancy EY, researchers analyzed responses from FTSE 350 companies. It followed on from a preliminary report published in 2017.
The FTSE 350 index is comprised of the U.K.'s 350 most valuable publicly-listed companies. The 100 firms in the index with the highest market capitalization are also categorized within the more famous FTSE 100.
Across all of the FTSE 350, 256 firms gave data that showed 150 (59%) had no ethnic representation at all on their company boards.
Of the 83 FTSE 100 companies that volunteered to submit data, 37% had no ethnic minority representation on their boards. That meant just 52 FTSE 100 firms were able to confirm that at least one board member had come from an ethnic minority background.
For the top jobs, just six ethnic minority directors held the position of chair or CEO across the FTSE 100, according to EY's report.
When widening the analysis to the FTSE 250, boards were even less diverse, according to the report, with almost 70% reporting no ethnic diversity on their boards. Just nine people with ethnic minority backgrounds held CEO or chair roles at FTSE 250 companies.
New jobs ‘Challenging' target
In 2017, the first report made a series of recommendations for FTSE-listed firms, including a target of having at least one director from an ethnic minority background by 2021. However, according to the 2020 findings, reaching that target would be “challenging” for most FTSE companies.
The report suggested companies take steps such as reporting their ethnic diversity policies, publishing data on their boardroom diversity, and developing a pool of “high potential ethnic minority leaders” through mentorship programs.
Giles Gibbons, CEO and founder of ethical business consultancy Good Business, told CNBC via email that there was still “a striking lack of diversity among boards and CEOs.”
“We're simply not making progress,” he said. “The power of diversity is indisputable, and it's clear that it is good for business as well as society.”
However, he noted that that achieving a representative workforce wasn't easy, adding that “superficial efforts are worse than doing nothing.”
“No one wins if tokenism becomes the answer,” he explained. “To build a genuinely diverse organization you need to make it an explicit priority, and in the short term that has to include the introduction of controversial measures such as quotas. You need to reach a critical mass so that the culture and makeup of the organization changes.”
“Companies that don't prioritize ethnic diversity at the highest level risk turning off job seekers and disengaging their workforce — not to mention falling foul of increasing regulation and scrutiny around diversity of boards,” added Jo Cresswell, careers expert at global jobs site Glassdoor.
However, she noted that diversity shouldn't be treated as a tick-box exercise, suggesting that firms implement measures such as hiring a head of diversity and inclusion.