Published
LondonThe City wants more leaders of modest origins in the world of finance
A report on diversity in London’s financial district published on Wednesday recommends an action plan to tackle the overrepresentation of the wealthy classes in this sector.
The City of London, the financial district of the capital where the Stock Exchange is located, does not shine by its socio-economic diversity, according to a new report.
Photo d’illustration/REUTERS
Finance must have “at least half of senior managers from modest backgrounds” by 2030, demands the City of London Corporation, the body representing the interests of this powerful sector in the United Kingdom, where classes affluent are overrepresented. This recommendation is issued by a task force on diversity within the City, the financial district of London, which published a report on Wednesday commissioned by the Department of the Treasury and that of Business, Energy and Industry (BEIS) in 2020.
This group has prepared “an action plan to counter the low rate of social mobility in the UK and more specifically the lack of socio-economic diversity at the top of the service professions and finance”. “If around half of the employees in the sector do not come from upper socio-professional categories but from the working and middle classes, these employees have a 25% slower progression than their peers. Only 36% of them reach the upper echelons” of companies, notes the press release from the City, relating the results of the report. Employees not from higher socio-professional categories are also paid less on average, the statement said.
Breaking the glass ceiling has business benefits
The task force report recommends that “all organizations in the sector begin to collect data on the socio-economic origin of their employees”, and also encourages regulators, government bodies and sector federations to take measures to “encourage employers” to diversify their workforce. In its press release, the City underlines that it is “demonstrated that the profits of organizations which make efforts to improve socio-economic diversity are 1.4 times greater than those of their competitors”.
“It is essential” that companies in the sector “allow talented people to climb the ladder regardless of their origin. We have to break the glass ceiling linked to social class,” comments Catherine McGuinness, chair of the diversity task force. For her, having more leaders from humble backgrounds is not only ethical, but should boost “productivity, employee retention and innovation.”
“This working group sets important objectives, knowing that social mobility is lower in countries with high income and wealth inequalities, and the United Kingdom is one of the most unequal”, comments Louise Ashley, associate professor at the University Queen Mary of London. “My own research and data elsewhere show that elite firms in the City directly fuel these inequalities, through their daily activities, in a highly financialized economy and payroll practices that exacerbate the gaps between rich and poor,” adds- she.
(AFP)
