Green Park held a recent roundtable discussion on socio-economic diversity in Financial Services, along with our partners at Progress Together. Introductory remarks were made by Raj Tulsiani, CEO of Green Park, Michael Turner, Progress Together Board Member, and Nik Miller, CEO of the Bridge Group, with the session facilitated by Sharon Spice, CMVO at Green Park.
Key takeaways from the event include:
- In short, talent is the crux of the issue, with people from lower socio-economic backgrounds too often unable to reach their full potential within Financial Services.
- Financial Services is hugely important to UK economy. The industry has to put its best team forward and this can’t happen if talent can’t be accessed or developed.
- We need to level the conversation so everyone has an opportunity while ensuring others don’t feel threatened.
We need to take into account:
- Socio-economic background influences outcomes more than gender or ethnicity, with a stronger effect on women than men.
- Access for entry-level roles is improving but progression later in careers is not.
- There are four key ingredients to social mobility: entry level hiring, retention, progression and experienced hiring. Some companies are now publishing targets, which experts see as progress.
- Individuals from higher socio-economic backgrounds are more able to get ahead due to social connections, access to opportunities, or even clients’ preferences or “sponsors” within a company who subconsciously help people like themselves.
- Both individual action and societal change will be necessary to significantly move the dial.
- Research from one company showed that employees from lower socio-economic backgrounds often felt intimidated, lacked confidence, and struggled to progress. Almost half were non-white and they felt that their socio-economic background was more influential than their race.
The role of (or fixation with) data
Data clearly plays a large role in the journey toward greater diversity. Our speakers shared their thoughts on its role, with one stating “It’s important to collect socio-economic data because it can be hidden so easily. Data is vital to understanding how interventions are working.” However, others felt that a dependence on data inhibits action: “Don’t let data be a barrier!” was a sentiment shared by many.
The socio-economic challenge in numbers – the statistics behind the story:
- 90% of Financial Services roles are held by people from higher socio-economic backgrounds.
- Socio-economic diversity has been proven to be more influential on outcomes than gender or ethnicity, and has a stronger effect on women than men. This is known as a double disadvantage.
- People from lower socio-economic backgrounds progress 15% more slowly than their counterparts. This means it takes almost two years longer to progress from middle to senior manager, leaving a ‘progression gap’. This is proven to have nothing to do with performance in any sector, except for Legal where those with lower socio-economic backgrounds actually outperform their counterparts.
- Lateral hiring (from external sources) typically contributes negatively to diversity if you don’t use a specialist recruiter.
- On a macro-economic level, we find greater social mobility leads to greater productivity.
- Socio-economic background affects progression more strongly in the UK and US than in other developed countries.
Quotes from the session
“The journey is just starting; this will be a long-term change taking years if not generations. Sharing the business case is necessary because not all organisations understand. And a lot of people from higher socio-economic backgrounds feel threatened but this is about increasing the size of the pie. If talent can’t be accessed, you can’t put your best team forward and thrive.”
“You already know you have a problem; don’t let lack of data stop you. There’s massive over-emphasis on early careers – progression is where the problem is. Individual action and societal change are both needed.”
“DEI is designed to get the best person in the role. People should only fear it if they got in role without talent and hard work.”
“I’m from a working class background. I always had someone push me or give me a leg up, but what about those who don’t get the nudge and fail to reach their full potential?”
“We’ve seen clearly why data collection is so important. People need to know they can trust you and what you’re doing with data.”