Who Gets Ahead: The Business Case
Who Gets Ahead: The Business Case
Foreword
Economic growth starts with individuals. Without personal growth, there can be no national growth. Yet for too many individuals, that personal growth is constrained either by their geography or their history. That is why issues around levelling up and social mobility are pressing public policy priorities if we want to grow people, places and economies.
In a great many respects, the Financial and Professional Services (FPS) sector is a leader on the international stage. Yet when it comes to representation at senior leadership levels the under-representation of those from non-professional backgrounds makes the FPS sector a laggard, not a leader. Now is the time to change that.
The case for change could hardly be stronger. As this report sets out clearly, unlocking the potential in people would ease recruitment difficulties, nurture diversity and innovation and thereby boost productivity and performance at the organisational level. As a matter of social justice, it is also quite simply the right thing for companies to be doing to maintain their social license.
As co-chair of the City of London Corporation Task Force on Socio-Economic Diversity, I would like to extend my thanks to the many colleagues from across the FPS sector who have contributed so passionately and expertly to this work. And I would like to extend a particular thanks to PWC as our core partners.
The fruits of these labours are contained in this report. It makes the business case for greater socio-economic diversity, particularly at senior levels, compellingly and comprehensively, grounded in evidence and experience. The report forms the analytical bedrock for the accompanying ambitious diversity recommendations and targets for the sector to meet in the period up to 2030.
Andy Haldane
Chief Executive The RSA
Royal Society for Arts, Manufactures and Commerce
1
The Business Case – It’s Really Time For Action now
The evidence is stark. Where you get to in your working life is tightly linked to where you start from; both advantaged and disadvantaged starting points tend to get entrenched, and certainly that is true when the data for the Financial and Professional Services sector (FPS) is examined.
2
The Cost of Wasted Talent
Talent is critical. Organisations can and must pay close attention to the factors that are impacting their workforce. The evidence shows that Socio-Economic Diversity can be a lever to gain competitive advantage.
3
Licence to Operate
In a fragmented world, characterised by mistrust and division, there is a growing acceptance that businesses need to be part of the solution, not the problem.
4
Socio-economic background – The Golden Thread
Focussing on Socio-economic diversity will benefit from a multiplier effect on other D&I characteristics such as gender & ethnicity. This is due to the intersectionality of Socio-economic background and the impact of multiple-disadvantage.
5
Innovation
Innovation thrives in diverse environments. Leaving out the perspectives and views of so many in society will lead to suboptimal outcomes for business, and they will be at risk of not developing the products and services that the whole of society need.
The Business Case – It’s Really Time For Action Now
The evidence is stark. Where you get to in your working life is tightly linked to where you start from; both advantaged and disadvantaged starting points tend to get entrenched, and certainly that is true when the data for the Financial and Professional Services sector (FPS) is examined.
Reaching a senior position is inextricably linked to your background rather than just being based on your ability. The evidence shows that those from an advantaged background are 43% more likely to reach a senior position in financial and professional services. There seems a systemic talent problem that narrows the opportunity for all.
The Cost of Wasted Talent
Talent is critical. Organisations can and must pay close attention to the factors that are impacting their workforce. The evidence shows that Socio-Economic Diversity can be a lever to gain competitive advantage.
The Taskforce looked at socio-economic diversity at senior levels. The research undertaken by the Taskforce shows that there is a progression gap for those from working class backgrounds. In this section, we will explore the impact using three focus areas; opportunity cost, attrition cost & performance cost.
Licence to Operate
In a fragmented world, characterised by mistrust and division, there is a growing acceptance that businesses need to be part of the solution, not the problem.
Employees are continuing to scrutinise how well their organisation is looking after the workforce, and doing the right thing by society at large, especially in such uncertain times. The past two years have provided a period of introspection that has left many questioning whether the organisation that they work for is still a good fit.
Socio-economic background – The Golden Thread
Focussing on Socio-economic diversity will benefit from a multiplier effect on other D&I characteristics such as gender & ethnicity. This is due to the intersectionality of Socio-economic background and the impact of multiple-disadvantage.
Unlocking the often hidden characteristic of socio-economic background and using this data to uncover deeper insights into existing diversity data (such as ethnicity and gender) enables a shift to a “whole person” approach to DEI, instead of a single-lens approach which can lead to inequitable outcomes. This allows organisations to supercharge DEI efforts and accelerate progress, by acting as a multiplier and removing barriers for many underrepresented groups.
Innovation
Innovation thrives in diverse environments. Leaving out the perspectives and views of so many in society will lead to suboptimal outcomes for business, and they will be at risk of not developing the products and services that the whole of society need.
Organisations that have a socio-economically diverse workforce benefit from a deeper pool of experiences upon which to draw. These diverse teams are better positioned to unlock diversity of perspectives and new and forward-thinking ideas. Individual creativity is enhanced by the ability to integrate different points of view ensuring both better decision-making and problem solving ability within a team environment.
Innovation
Innovation thrives in diverse environments. Leaving out the perspectives and views of so many in society will lead to suboptimal outcomes for business, and they will be at risk of not developing the products and services that the whole of society need.
Organisations that have a socio-economically diverse workforce benefit from a deeper pool of experiences upon which to draw. These diverse teams are better positioned to unlock diversity of perspectives and new and forward-thinking ideas. Individual creativity is enhanced by the ability to integrate different points of view ensuring both better decision-making and problem solving ability within a team environment.
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