Nearly half (47%) of decision makers think there is a difference in the average pay of White and ethnic minority staff in their company.
Figures are even higher in certain industries, with 52 percent of decision makers in the IT industry believing their company has a pay gap, and almost two thirds (64%) in the accounting and finance sector.
This is according to research by Involve, which also shows a lack of diverse senior leadership in UK businesses which may also be responsible for the ethnicity pay gap.
INvolve’s founder, Suki Sandhu OBE, calls for UK companies to step up by collecting ethnicity data from employees and publicly reporting their ethnicity pay gaps.
The research comes as INvolve, the consultancy and global network for diversity, equity and inclusion in business, releases its annual Empower Role Model Lists of individuals in global business who are opening up opportunities within the workplace for people of colour.
Diversity, equity, and inclusion (DE&I)
“The existence of the ethnicity pay gap is a fundamental sign that not enough has been one to improve ethnically diverse representation across senior leadership,” says Sandhu.
While the Government has refused to make ethnicity pay gap reporting mandatory, the research found that almost all employees surveyed (95%) are willing to disclose their ethnicity to their employer.
These overwhelming numbers show that the data needed to collect and report on the ethnicity pay gap is well within companies’ grasp, even without Government mandate.
While awareness of DE&I in business has generally improved, there is still a distinct lack of diversity among the UK’s business leadership. This is thought to be a key driver of the ethnicity pay gap in many companies; where there are fewer leaders who come from diverse ethnic backgrounds, the average earnings level compared to White employees is undoubtedly impacted.
What can be done?
“The first, and critical, step to drive progress and accountability for change is honest, transparent measurement to create clear benchmarks for progress,” suggests Sandhu,
“While there is currently no legal mandate, businesses taking DE&I seriously should be stepping up and reporting their ethnicity pay gaps. It’s incredibly encouraging to see how many employees are willing to share the data needed to report this and suggests an appetite for change and transparency across businesses. We’ve seen progress made on the gender pay gap – it’s now past time to address ethnicity,” adds Sandhu.
“Our Empower lists celebrate role models in business who are smashing barriers and doing the work to advocate for people of colour across global businesses. These Role Models have made it their mission to make a real difference and we must look to them as examples of how we can all contribute to the removal of barriers and create businesses where everyone can thrive,” says Sandhu.
Tiger Tyagarajan, CEO at Genpact LLC says: “Embedding true diversity of perspective – across gender, ethnicity, race, and cognitive ability – into the fabric of an organisation is critical to creating meaningful client outcomes and unlocking competitive advantage. For Genpact, it is an agenda that is inextricably linked to our business strategy. I am honoured to be recognized as an Empower Role Model and to spearhead our journey in driving innovation that matters for the world.”
Crystal Sai, Executive Director, Chief of Staff, Global Online at Estée Lauder Companies says: “I am honored and very humbled to be named #1 to Empower’s 100 Future Leaders Role Model List and to be recognized for this critical work. I believe that DE&I should be embedded in everything that we do – every time we walk into a room without diversity, we are leaving innovation, creativity, and diversity of thought/experiences on the table. This work is tough, I couldn’t do it without the help of my community, both personally and professionally.”
Mark Read, Chief Executive at WPP who has been named the leading Advocate for Ethnic Minority individuals in the 2022 honours, says: “For WPP, a diverse and inclusive culture is a business opportunity as well as an imperative. Building teams from different backgrounds and experiences helps us to understand our audiences better, deliver innovation and produce the best work for our clients. Ultimately, our success is driven by our people and I’m proud of what we’re doing together across WPP to create a culture where people feel they belong and want to be a part of.”
INvolves research celebrates businesspeople playing a central role in breaking down barriers at work for black people and other ethnic minorities; using their positions to keep diversity and inclusion at the top of the agenda.