Top companies urge firms to set ‘clear and stretching’ racial diversity targets


Companies should have at least one BAME board member and set ‘clear and stretching’ targets for increasing racial and ethnic diversity in senior leadership, the Confederation of British Industry (CBI) and a group of major organisations have insisted.

The CBI and organisations including Microsoft, Aviva, Deloitte, Linklaters and Brunswick are urging businesses to sign their Change the Race Ratio commitment, which will launch at the end of this month and commits signatories to driving tangible change at senior level.

It encourages firms to set targets for greater racial and ethnic diversity on boards, executive committees and at “ExCo minus one” level. They should also publish those targets and their progress towards them.

Earlier this year it was revealed that 37% of FTSE 100 companies surveyed by the Parker Review (31 out of 83 companies) and 69% of FTSE 250 companies surveyed (119 out of 173 companies) still did not have any ethnic minority representation on their boards.

“The time has come for a concerted campaign on racial and ethnic participation in business leadership. Progress has been painfully slow. We want to do for racial and ethnic diversity what the 30% Club has done so successfully for gender equality,” said Lord Karan Bilimoria, CBI president.

Richard Houston, chief executive of Deloitte UK, said: “The energy of the Black Lives Matter movement has given a fresh sense of urgency around racial diversity in business. Change the Race Ratio aims to grasp this moment to create real and lasting change.”

Signatories to the campaign must commit to the following:

  1. Increasing racial and ethnic diversity among board members and setting targets to achieve at least one racially and ethnically diverse board member by end 2021 (FTSE 100), or by 2024 (FTSE 250).
  2. Increasing diversity in senior leadership (executive committee and the level below the executive committee), by setting clear and stretching targets and publishing them within 12 months of making the commitment. They should also establish a separate target for black participation at both
  3. Being transparent on actions, by publishing a clear action plan to achieve the targets and sharing progress in their annual report or company website. They should also disclose ethnicity pay gaps by 2022 at the latest.
  4. Creating an inclusive culture in which talent from all diversities can thrive, by focusing on recruitment and talent development processes; data collection and analysis; fostering safe, open and transparent dialogue, with mentoring, support and sponsorship; and working with a more diverse set of suppliers and partners, including minority owned businesses.

Other founding members of the initiative include Cranfield University, City Mental Health Alliance, Business in the Community and Russell Reynolds.

Business in the Community’s race director, Sandra Kerr, said: “We know that the conversations in the boardroom set the tone for the rest of the company and more diverse representation around those top tables is long overdue.

“The shocking events of 2020 have led to some great-sounding promises from business – serious steps like capturing ethnicity data, publishing their ethnicity pay gap and setting ethnicity targets for improvement for executive level within their organisations show that a company is thinking about more than just jam tomorrow.”

In August, in a report looking at next steps following the Black Lives Matter movement, BITC urged organisations to form a network of “allies” who were willing to collaborate on solutions to help firms be more inclusive of their black colleagues.

Hugh Milward, general manager, corporate external and legal affairs at Microsoft UK, said: “We are on a journey to increasing diversity across Microsoft, and in particular at our most senior levels. But when more than a third of leading organisations still don’t have any ethnic minority board representation, the pace of chance is too slow.”

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