We can move further and faster to bring diversity to the board room

Conservative Party Vice Chairman calls for government action to expose disadvantage and discrimination in the hiring of non-white candidates.

In a move designed to put the focus on gender diversity in the workforce, the government recently published regulations which include the requirement for listed companies to disclose the number of women and men within their organisation as a whole and at senior and board levels. The government has now also called on all executive headhunting firms to publish the numbers of men versus women they place in senior positions.

But the government should look into going further. Whilst gender balance is one measure of workforce diversity, ethnicity is another. Championing workforce diversity should be about improving both.
The regulations should be extended so listed companies also have to set out the number of employees from both white and black and ethnic minority (BME) backgrounds within their workforce as a whole, as well as at senior and board level.

Just as there is under-representation of women at senior levels there is also under-representation of those from non-European ethnic backgrounds. The latest figures from the Office for National Statistics estimate that around 12 per cent of the population in England and Wales has a non-white ethnic minority background.

By contrast, the overall proportion of ethnic minority male and female directors on the board of FTSE 100 companies is only 4.4 per cent and 1.3 per cent respectively, according to analysis published this year by Cranfield University. And only seven of the 48 male directors from minority backgrounds, are known to be British.
It is a real concern that there may not always be a level playing field when it comes to applying for a job. The All Party Parliamentary Group on Race and Community has just published a report on ethnic minority female unemployment which concludes that discrimination can be found at every stage of the recruitment process - when assessing applications, during interviews, at recruitment agencies and also in the work place itself. Just having a non-European name may stop a candidate from getting an interview.
To throw light on this the government could consider introducing a further disclosure regulation with listed companies required to breakdown, by gender and ethnicity, the total number of job applicants, interviewees and new employees over the past year. This would certainly help to highlight companies and sectors where either, ethnic minority candidates and women are just not applying in any number, or where they are not getting interviews.

Some may explain a low level of interviews to minority background applicants by the fact that not enough qualified candidates are applying.
If this really is the stumbling block, it should reinforce the need for companies to undertake more outreach work and mentoring to achieve, over time, a workforce representative of today's society.

Appointing people to jobs on merit and experience is absolutely right. But the proposed new regulations are about taking companies one step further towards focusing on what they need to do to increase diversity in the workforce.

Companies with diverse boards are more effective and outperform their rivals. If a company's workforce and senior management are representative of its customers, it is more likely to make decisions which respond to their needs and hence ultimately benefit the business. And that virtuous circle is one which every company should be looking to square.

Alok Sharma is MP for Reading West and Conservative Vice Chair with special responsibility for BME communities

The way things were and often still are. All white men. Source: Getty

Alok Sharma is the MP for Reading West and Vice Chairman of the Conservative Party with special responsibility for BME communities.

Photo: Getty Images
Show Hide image

The Fire Brigades Union reaffiliates to Labour - what does it mean?

Any union rejoining Labour will be welcomed by most in the party - but the impact on the party's internal politics will be smaller than you think.

The Fire Brigades Union (FBU) has voted to reaffiliate to the Labour party, in what is seen as a boost to Jeremy Corbyn. What does it mean for Labour’s internal politics?

Firstly, technically, the FBU has never affliated before as they are notionally part of the civil service - however, following the firefighters' strike in 2004, they decisively broke with Labour.

The main impact will be felt on the floor of Labour party conference. Although the FBU’s membership – at around 38,000 – is too small to have a material effect on the outcome of votes themselves, it will change the tenor of the motions put before party conference.

The FBU’s leadership is not only to the left of most unions in the Trades Union Congress (TUC), it is more inclined to bring motions relating to foreign affairs than other unions with similar politics (it is more internationalist in focus than, say, the PCS, another union that may affiliate due to Corbyn’s leadership). Motions on Israel/Palestine, the nuclear deterrent, and other issues, will find more support from FBU delegates than it has from other affiliated trade unions.

In terms of the balance of power between the affiliated unions themselves, the FBU’s re-entry into Labour politics is unlikely to be much of a gamechanger. Trade union positions, elected by trade union delegates at conference, are unlikely to be moved leftwards by the reaffiliation of the FBU. Unite, the GMB, Unison and Usdaw are all large enough to all-but-guarantee themselves a seat around the NEC. Community, a small centrist union, has already lost its place on the NEC in favour of the bakers’ union, which is more aligned to Tom Watson than Jeremy Corbyn.

Matt Wrack, the FBU’s General Secretary, will be a genuine ally to Corbyn and John McDonnell. Len McCluskey and Dave Prentis were both bounced into endorsing Corbyn by their executives and did so less than wholeheartedly. Tim Roache, the newly-elected General Secretary of the GMB, has publicly supported Corbyn but is seen as a more moderate voice at the TUC. Only Dave Ward of the Communication Workers’ Union, who lent staff and resources to both Corbyn’s campaign team and to the parliamentary staff of Corbyn and McDonnell, is truly on side.

The impact of reaffiliation may be felt more keenly in local parties. The FBU’s membership looks small in real terms compared Unite and Unison have memberships of over a million, while the GMB and Usdaw are around the half-a-million mark, but is much more impressive when you consider that there are just 48,000 firefighters in Britain. This may make them more likely to participate in internal elections than other affiliated trade unionists, just 60,000 of whom voted in the Labour leadership election in 2015. However, it is worth noting that it is statistically unlikely most firefighters are Corbynites - those that are will mostly have already joined themselves. The affiliation, while a morale boost for many in the Labour party, is unlikely to prove as significant to the direction of the party as the outcome of Unison’s general secretary election or the struggle for power at the top of Unite in 2018. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.