Considerations for an organisation’s quest for diversity gold.
CandidateX recently released our first research piece in the Diversity of the UK Fintech and Challenger Bank sector. If you missed it, it can be found on
I thank you, if you did take the time to read over and hope you found it suitably informative and interesting. To support our research, I also wrote the following to accompany the release.
Contrary to what you may expect in the following you will not find specific narration and commentary of the information provided. I decided against telling you, the reader, my own interpretation of the information. I feel my words specifically highlighting Bank A against Bank B’s numbers is not perhaps what you need. The data gathered should speak for itself and encourage you the reader to form your own opinions and ideas of where the industry and the reported organisations are in their diversity and inclusion agenda.
This is after all a snapshot in time and one without added context of why organisations have or have not taken certain steps. It is difficult to assess in full without willingness from the specific organisations to share and collaborate. (We hope the report will enable us to achieve this next time around).
I recognise each organisation has available to them different resources and are at different stages of discovery about their culture, hiring/succession strategy, processes etc and the specific impact these factors all have with creating a truly diverse and inclusive culture.
We believe the work we’re doing through such research pieces should ultimately provide organisations more context and understanding to do just that. In this spirit I will be sharing some of my own views on the value of D&I data to your organisations, site examples in other sectors for relevance in how it is used and whether its effective. I combine this with some wider considerations, including something I feel is key to the discussion, identity.
With subsequent new and follow up research pieces we hope to narrate and capture more companies and organisations — hoping they will collaborate in providing transparency and visibility of their make-up and initiatives. No use in signing up to different pledges but not be willing to disclose information. This only leads to the belief such actions are performative only and without true drive for change.
THE BUSINESS CASE
Why should organisations in the F&C sector care? Why should organisations in any industry care or concern themselves with Diversity and Inclusion?
Although many may point towards the notion of doing the right thing or moral duty, we should also acknowledge that has not always been the north star for commercial operations.
In any industry, three words are always mentioned when proposing or implementing strategy or initiatives. Return on Investment (ROI) — specifically what is the ROI of introducing and implementing any action for D&I? What does the organisation receive in return for its investment?
For the F&C sector not fostering an inclusive mindset and relevant strategy can limit and curtail commercial opportunities. Adopting inclusion to enable more diverse teams will expand a potential client base. Diversity in team will mean diversity of experiences, diversity of ideas and critical thinking of the needs of other members of that diverse community.
For the F&C sector, a clear example is the Unbanked or Underbanked market. Unbanked or Underbanked typically refers to individuals who can’t participate in more traditional banking services, who opt out of traditional money management and transaction options and are credit invisible.
These terms are in place to categorise those who may have bank accounts but struggle to make ends meet whilst the unbanked pay for everything in cash. With the pandemic creating more obstacles in using cash for goods these groups of individuals are hugely underserved.
The opportunity to provide banking to the world’s poor has been valued at $100 trillion! Angela Strange, a general partner at Andreessen Horowitz described this as the “greatest market opportunity in fintech — low cost, high tech financial services… This opportunity is massive. Depending on which numbers you believe there are anywhere from 2 to 3 billion people worldwide”.
Similarly, the size and scope of the market for the disabled community is huge. According to EquaLex, globally, the market is estimated to be 1.85 billion consumers. That’s a larger market size than the population of China!
Another factor is the emotional attachment friends and families have with the related needs of persons with disabilities. Combined, these groups have an estimated disposable income of more than $13trillion. (source — Design Delight from Disability, Return on Disability Annual Report 2020). Numbers of this magnitude cannot be ignored.
As with any emerging markets, businesses that do well are those that invest time and resources in understanding the unmet needs and providing products and services that respond to these needs. To achieve ongoing success and be ahead of the competition, businesses need to do and be more than just reactive. Actions resulted from complaints and changes in legislation is not enough. To secure a positive and sustainable ROI, businesses should look to actively engage new customers and be proactive in the market opportunities such as these underserved areas.
This means finding ways to create new revenue streams, expand existing markets and achieve a closer connection to more customers.
To do so, organisations need and should have members in their teams that reflect their current and potential customer bases. Lack of representation means a void in understanding the needs, experiences, and potential struggles of these groups in using their products or services.
Whilst we may have an ability to empathise or understand elements of what it is like to use products by a member from a specific group, we will not fully comprehend without an active voice to guide creation.
From books, stories, and conversations, I have a sense of understanding of some of the struggles the Black community faced post abolition of slavery in the US. But until you have been a member of a family that took four generations to reach the property ladder, you will not truly appreciate how products and services are not created with you in mind.
If you have a digital banking product that doesn’t consider accessibility a priority it is fair to say your organisation will not meet the needs of the disability community. Accessibility is often one of the last pieces of consideration worked on (begrudgingly). This can only change with voices in the decision-making process from disabled members who require specific consideration of their needs.
Sustainable companies consider the experiences of as many potential people as possible. An inclusive approach for when using their (digital) products, paying particular attention to the specific needs of the customers it aims to serve.
To do so they must ensure their processes, policies, suppliers, approaches, everything enables inclusion.
THE VALUE OF DIVERSITY DATA
It is important to understand the value of representation of diversity in organisations. Understanding data is key to diagnosing an organisation’s diversity, equity, and inclusion heartbeat. It is for this reason we wanted to conduct this research.
Data can enable more relevant, specific initiatives and strategy for applicant engagement, recruitment, addressing attrition and improving culture within an organisation.
The challenge is capturing the data.
Personal and sensitive data is important to the individual and there is a natural concern to the purpose of its request. With recent examples of company antitrust, misusing and mishandling of our data we have a right to be concerned.
Diversity research such as ours into ethnicity and gender in the workplace, requires an organisation to capture this. Understandably, many would fear, what this type of data would be used in conjunction for and with when they apply for roles and once they’re inside the organisation.
TIMES THEY ARE A CHANGING
A world changing event such as this pandemic intersecting with a cultural changing event, such as the tragedy of George Floyd heightens sensitivity and highlights inequality.
This awareness demands discussion and action, encourages change, and increases expectations from an organisation’s most important assets — its people (both customers and employees).
To enable discussions and actions which are relevant to the increased expectations, organisations must begin by understanding and being aware of diverse representation throughout their organisation — especially at decision- and money-making levels. Equity in the diversity and inclusion conversation is a MUST.
Only establishing this understanding can organisations begin to produce an effective strategy with impact. Diversity data has never been more important.
Transparency of organisational data and representation isn’t straightforward. As well as the aforementioned natural reservation employed by individuals, for others, specifics in diversity seems unimportant and is viewed as an indicator of our differences, which is unhelpful in equality, inclusion, and equity efforts.
We have all heard people say (paraphrased)…” to end racism, we simply need to stop talking about colour”.
Although the outcome above is what we want, there is unfortunately a long journey to get there.
Beginning with, understanding our diversity, where inequality of opportunity exists and the wider impact of how lack of representation affects the communities these organisations serve.
However often, the strategy employed, bypasses these steps in preference to more familiar solutions such as targets or quotas as a means of symbolic achievement.
TARGETS AND QUOTAS
Working towards targets is a very relatable concept for us as human beings. Unsurprisingly targets, even quotas are what several organisations have defaulted to and have in place as a firm action in their diversity and inclusion strategy. Organisations that see reports or research such as this one may react with implementing a quota-based strategy to address any negatively perceived shortfalls.
Numbers make results tangible and given how much pressure there is for organisational actions to exhibit results in diversity and inclusion, targets do make some sense.
Standard Chartered Bank (SCB) recently committed to targets addressing ethnic representation in their UK and US Senior leadership team. By 2025, SCB aims to have 20% representation from their current 12.75% of BAME Senior Leaders in the UK.
Other companies have reacted on gender diversity. In the US, organisations working towards for gender parity via targets of hires is very popular. This has been in place for some time with many companies striving to achieve gender balance within their senior leadership/board teams.
It is important to note that whilst there is a lack of legislation specific to the adoption of quotas mandating organisations of any size or nature to hire specific groups of individuals; external pressures do exist in other forms for them to do so. With McKinsey establishing and popularising the business case for diversity through their annual reports, it is events like Davos and organisations like Goldman Sachs who have placed pressures of not only acknowledging the importance of diversity for business’ but making it part of their hiring and general policies.
David Solomon, CEO of Goldman Sachs used the 2019 Davos event to announce their IPO rule — No more all white, all male boards, effective of July 2020 for US and European organisations.
Does it work?
Well, targets work in one way as you clearly understand where you want to be. Targets serve a great purpose to gauge your success which is particularly important as there is demand to see your organisation’s achievements and progress in this space.
Numbers and targets can also serve to galvanise your organisation, if members of the organisations all strive for this goal.
Despite the amount of focus in this report on numerical representation, it is key to state, over focusing on achieving numbers or quotas is short-sighted and potentially dangerous for an organisation’s diversity and inclusion strategy.
Why? Because like most things within diversity and inclusion, even numbers are not straight forward.
Changing the parity of representation is important, but simply changing a policy to ensure favour for representation of one group over another will see a rise of other problems.
I have sat at events where organisations announce the diversity aims focused on gender for the year, the year before perhaps was ethnicity and always there will be a group who feel overlooked. “When is it the year for LGBTQ or the year for disability?” I would hear.
In my role in the recruitment business, I have had clients state; “I want a BAME candidate for this role” or “…we can’t offer your candidate because we really need a female in this role”.
Well intended as these policies may be, they are proactively discriminating and can potentially destabilise your teams.
A positively impactful D&I policy should never be a zero sum game.
Tokenising hires allow existing team members to become sceptical of the individual’s credentials.
“She got the role, because we need to balance the numbers”
The ironic paradox of steps to inclusion through an exclusive approach.
As we say at CandidateX, prejudice cannot be defeated by prejudice.
Does adding more individuals from the Black community automatically change the culture of an organisation? Or will the organisation achieve more than demonstrating numbers?
Does adding more women into an organisation similarly have this impact? Perhaps yes, perhaps no. There is an argument that strength in numbers can create change. However only if the numbers are allowed and encouraged to speak out, form ideas and decisions. Many organisations unknowingly have systemic bias rooted deep into their processes which unsurprisingly impact their ability to advocate inclusion into the culture of the business.
Take a start-up for instance, they will naturally be working at great speed to build and create. Hiring practises as I have seen in many such cases cater for this pace but can be unstructured and often with a path to least resistance. Referrals for suitable candidates is preferred which generally means you hire who you know. As such everyone has similar backgrounds, experiences, and ideas. It is what I have seen happen time and time again BUT I can empathise with why.
It’s when they begin to grow and scale that things need to change, but is it clear when that is? And before they become too big and have to undo and reengineer layer upon layer.
Deep, systemic policy and process review combined with deliberate action and belief from the leadership team creates an inclusive culture that actually enables diversity to be truly powerful. Until that is the case, diversity will not become an asset. Simply adding in numbers of women or BAME candidates will only mean similar number of women and BAME candidates leaving the organisation if none of the other groundwork for inclusion has been laid.
In 2017, Pinterest like many other (big tech) organisations set a goal of 30% women in engineering roles. Last year, Francoise Brougher, their former COO, sued the company for gender discrimination. She was awarded $22.5 million.
If inclusion isn’t embedded into the organisation at the core, then any individuals brought in to meet quotas will be just for that.
“Innovative accounting” will only paper the cracks so much, if the culture is riddled with micro-aggression, inappropriate communication (like gendered feedback in the case of Pinterest), outdated hiring processes, exercises exclusion, does not engage and so on. Expressly focusing on targets and quotas is short-sighted because of this.
Numbers obviously do matter. We went to great pains to highlight figures, we felt were key and important in illustrating within the Fintech and Challenger space. Numbers can give colour to the landscape of individual organisations and establish transparency of which to build upon. But defaulting to only that will only achieve so much.
Standard Chartered Bank, who I mentioned earlier has looked towards targets as the next step as they have had a robust strategy for some time, encompassing various means for inclusion to manifest diversity. Such approaches wholly considered stand a better chance of success.
Capturing the correct diversity data has a wider impact on the importance we place on our identity.
How do you identify? Your personal understanding of your gender, faith, ethnicity, sexuality, ability/disability, your care responsibilities, social background etc are ALL important. These things are unique to you and in some cases define you. Given so much of our lives is within work, these definitions should be reflected and correspond accordingly in our careers.
During our preparation of this report, we debated and discussed the use of BAME as the most suitable acronym. As someone who is Chinese, BAME should apply to me. Afterall I am an “Asian, Minority Ethnic”. However, I don’t think it correctly represents who I am. I do not identify with it. I know I am not the only individual who would “sit” in this category but does not feel they should.
We debated taking the Parker’s review lead of “Persons of colour” but in discussion it was rightly flagged, “…well isn’t White a colour?”.
We settled on using BAME for no other reason than ease. But where CandidateX would like to arrive at, is specifics of ethnicity within roles. Truly reflecting and representing individuals in the organisation and highlighting where parity is absent and what work needs to be focused on most to enable change.
Lloyds Banking Group has the acronym REACH — Race Ethnicity and Cultural Heritage. In REACH we found this to be a more inclusive and considered description and phrase. We all have a cultural heritage, one that we are proud of and would be happy to share. Though sometimes in life and work we find it is sadly suppressed. Suppression can also exist for how you identify your gender, sexual orientation, disability, responsibilities, your faith, your age etc.
Until your identity does not need to be supressed at work, organisations will find difficulty in accurately tracking these specificities?
Many of us are still asking for permission to be our “true selves” at work. Has the virus helped or hindered this? One thing is for sure, we are talking about our identity, our responsibility to that identity and what matters to us more.
There are many that oppose the specific labelling of each and every aspect of an individual. They do not want to talk about it as it is seen to reinforce discrimination, prejudices and differences. There are some also perhaps unwilling to understand and put the time in as to why we need this?
Ellie Goldstein, an 18-year-old model with Down’s syndrome starred in a Gucci campaign. It was posted by Vogue Italia and was shared by The Female Lead. The post carried a tweet which read
“ This is the type of inclusion the industry needs. Hopefully more brands will follow in the same direction!”
This was shared on LinkedIn which I happen to read.
A conversation caught my eye, where a member was debating that posts like these are performative allyship, impact minimal and too populous. Basically, jumping on the bandwagon, or tokenistic. Whilst understandable, even relatable, the member’s position was very cynical.
My own view was that I understand why he would believe that this was a token effort or a stunt to virtue signal or sell more goods. Organisations have not always behaved in complete transparency. Have not always created for the greater good and not solely for the bottom line.
It is whether there is any faith in organisations doing more and being the best, it can be for not only shareholders and for profit but for what it can do for its people, its community and in some cases for our world. Organisations have that responsibility.
In the case of the post about the model Ellie, perhaps Gucci could do more. (We can always do more). Perhaps by using money. Equitable action is regarded as more committed after all.
Perhaps Gucci could invest in a more sustainable way to bring diverse models to the forefront. Perhaps they already are.
I believe these posts do have impact. At the very least children with Downs Syndrome who see it and have aspirations of their own in modelling can be lifted and inspired. Even if that is only one child surely that is worth it?
Representation matters as seeing is believing.
The power an organisation yields is immense. It follows an idea coined by Baratunde Thurston, an American writer, comedian, and commentator. Baratunde sees this power best used when organisations behave like citizens fulfilling civic duties. On a podcast I listened to, Baratunde uses the example of FedEx’s influence as sponsor to the Washington Redskins in requesting a name change due to the racial slur for Native Americans.
Despite consistent refusal from club owner Dan Synder, FedEx was able to action its influence and currently The Washington Football Team is the holding name for the team until 2021.
If we believe that impactful change can be made by organisations and demand they invest in doing so, we must in turn be ready to do our part.
Be ready to proudly tell them who you are, your identity. what matters to you and how you can help them shape approaches to achieve it.
Be ready to proudly tell them who you are, your identity. what matters to you and how you can help them shape approaches to achieve it. Together WE Can.
About me: I’m Man Wong, a father of two crazy kids and the husband to an amazingly supportive wife. I happen to be the co-founder of a diversity and inclusion business called CandidateX.
Diversity and Inclusion Progress is slow — CandidateX is here to accelerate matters by delivering innovative inclusion propositions unique to your organisation.
Contact CandidateX https://www.candidatex.co/work-with-us/