The governor of the Bank of England has pledged to do more to tackle systemic racial inequality after a hard-hitting review found the 327-year-old institution was failing to do enough to promote diversity.
In an article for the Guardian, Governor of the Bank of England, Andrew Bailey, conceded that a major structural and cultural change was required in the light of a report by the Bank’s governing court detailing a series of failings and weaknesses in Threadneedle Street’s approach to inclusion.
The review said staff from ethnic minority backgrounds were less likely to be promoted, earned less and were even more likely to feel they were being treated unfairly than their white colleagues.
Despite efforts to foster a more diverse and inclusive Bank, the review concluded that there was “still a long way to go” for one of the UK’s most high-profile employers.
Bank’s Strategy lacked Focus
The Bank’s overall strategy for racial and ethnic inclusion lacked focus and clarity, with diversity given a lower priority than other work, the report added.
It made sixteen recommendations, among them that senior managers should be held accountable through their pay packets for meeting inclusion targets.
Giving his response to the review, Bailey said the ambition to create a truly diverse and inclusive Bank was “mission critical” for his organisation.
“As a first step, we have made diversity and inclusion one of our core strategic priorities for the coming years. This means increased focus, effort and energy from me, my senior team and Bank colleagues more broadly. We have also agreed new and stretching targets to increase representation – including at our most senior levels.”
Making insufficient progress on Diversity and Inclusion
Bailey said the Bank’s record was not good enough. “It was apparent that despite the substantial efforts by the organisation over the past decade or so, we were making insufficient progress on diversity and inclusion, particularly in the area of ethnicity.”
Minority ethnic employees make up about one-fifth of the Bank’s near 4,600-strong workforce, according to the organisation’s latest annual report, but targets for representation in senior management posts have not been met.
The review led by Diana Noble, a court member, said that despite the Bank’s efforts, “there were still material disparities between the collective lived experiences, career opportunities and outcomes of minority ethnic and white colleagues”.
White employees tended to receive higher bonuses
After joining the Bank, white members of staff tended to receive higher performance ratings and were more likely to progress up the organisation than their ethnic minority counterparts.
Promotion rates for white employees were generally higher, especially in more junior roles, and while pay rises were the same, higher performance ratings meant white employees tended to receive higher bonuses.
“Minority ethnic colleagues were more likely to leave the Bank. That is not surprising given the disparities in their career experiences. These higher attrition rates, coupled with fewer opportunities and slower promotion rates, led to lower representation of minority ethnic colleagues at senior levels,” the report said.
The culture at the Bank meant that diversity and inclusion had often been under prioritized in favour of other work.
This resulted in managers generally not identifying and seizing opportunities to disrupt inequalities, and not typically recognising when they were unwittingly contributing to unequal outcomes.
Efforts to be made to attract a more diverse pool of Applicants
The report recommended efforts should be made to attract a more diverse pool of applicants, recruitment practice improved, and senior managers held to account for “robust and fair” performance ratings.
While senior leadership had often indicated a desire to make progress, the Bank’s overarching strategy for racial/ethnic inclusion lacked focus and clarity.
“The Bank’s leaders and staff were inconsistently and insufficiently held to account for their actions in advancing diversity and inclusion. That may reflect a lack of clarity around responsibility and accountability for racial/ethnic inclusion across the Bank.”
Bailey said: “Structural and cultural change will not happen overnight. And I dare say we will have the odd stumble along the way. My hope, however, is that, during my time as governor, the Bank will be increasingly seen not only as a national institution with rich heritage but also one that has upped its game in order to embrace modernity, diversity and change.”
Sounds like the old school tie syndrome is still rife in the city!