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Ethnicity next step in UK financial sector diversity

Britain’s financial watchdog will publish requirements within a year for boosting ethnic diversity. This is among employees in finance, and by using targets and not quotas. The Financial Conduct Authority, Bank of England and finance ministry published a discussion paper last July. That is setting out how diversity and inclusion could be improved in one of Britain’s biggest economic sectors. It also suggested that senior managers could have their pay linked to progress in making workforces more diverse.

Georgina Philippou, senior adviser at the FCA, said that there will be proposals for public consultation in the second quarter. Philippou told a City & Financial conference on diversity in financial services stated that they never say quotas, they talk about targets. Targets tend to be more aspirational and take longer to fill, while quotas are mandatory. A Women in Finance project to improve gender diversity is beginning to bear fruit, with Philippou. Britain’s financial services minister John Glen urged financial firms to appoint a senior executive to be responsible for ethnic diversity and to set targets.

Britain’s Commission on Race and Ethnic Disparities has recommended that all employers voluntarily report pay gaps among ethnic groups. Glen said that there has been a testing exercise to understand the complexities of reporting such data and government was assessing the next steps. He told the conference that they will be very clear about what they want to do and why and how it will be implemented in a fair and reasonable way. He added that the focus on data is really important.

Diana Noble, who chaired the Bank of England’s review on ethnic diversity and inclusion, when asked if the diversity push will end up with a ‘zero sum game’, where one group’s gain could be negated by another’s loss of “white men missing out”, he stated that this reaction has to be faced. There is a whole community at the BoE who have had less opportunity over the past 5-10 years. This needed redressing over the next few years through targets and not quotas, according to him.

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