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Earlier this year the Financial Reporting Council reported that over half of FTSE 250 companies fail to mention ethnicity in their board diversity policy.
Just 14% of FTSE 100 and 2% of FTSE 250 companies set KPIs for board ethnicity. Even where objectives have been set, companies are not required to report progress against them.
The FRC has said that it expects much improved reporting by companies under the new UK Corporate Governance Code which promotes diversity in appointments and succession plans, including ethnic diversity.
To help accelerate the rate of progress, the 2020 Parker Review on ethnic diversity of Boards sets out additional recommendations which focus on measuring board level diversity and helping to build a pipeline of board-ready candidates.
The Black Lives Matter campaign has certainly put pressure on corporates worldwide to address inequality. Several large UK companies have recently acknowledged their historic links to slavery and have pledged to make donations to charitable groups in BAME communities, and high profile UK business leaders have written an open letter pledging to remedy systemic racism in their businesses.
These moves has been welcomed by both the Institute of Directors and the Confederation of British Industry, who highlight the lack of boardroom and executive level representation of black and ethnic minority workers and the disparity of pay between white British workers and those from ethnic minorities. Gender pay gap reporting came into force in the UK in 2017 and we expect to see mandatory ethnicity pay gap reporting soon, having been under consideration by the UK government for some time.
For more information on your company's Corporate Governance or Corporate Secretarial obligations, please contact:
Tel: +44 (0)7587 031 073