Although U.K. money managers are increasingly working to improve ethnic diversity and inclusion, data are lacking on the topic and hindering evaluation of their efforts, a new report warns.
Among the findings of discussions with 24 firms, collectively managing about £5 trillion ($6.9 trillion) in assets, the Investment Association and law firm Eversheds Sutherland found data to be a particular issue when it comes to analyzing ethnic diversity and inclusion.
While 75% of firms currently collect or have begun to work on collecting data on the so-called protected characteristics of their workforce — including ethnicity — legal, data protection and trust issues are obstacles to full disclosure. These problems mean only a handful of firms obtain sufficient data to draw meaningful conclusions, the report said.
"A recurring theme this report highlights is how a lack of data on ethnicity in a wider workforce — both due to the complexities of gathering it and low disclosure rates — impinges on a firm when it decides to investigate issues," said Pauline Hawkes-Bunyan, director of business for risk, culture and resilience at the IA, in the report.
To address this challenge, the IA formed its Diversity Data Working Group last year, providing an opportunity for member managers to share experiences and challenges associated with data collection, storage and analysis.
The findings will contribute to a practical guide, due for publication in the summer, that will help the IA's wider membership through the process of successfully capturing and utilizing the data to drive meaningful change, Ms. Hawkes-Bunyan said.
However, data did show that 96% of firms run regular training to educate employees about diversity- and inclusion-related issues, including understanding racial bias, microaggressions in the workplace, everyday racism, privilege and belonging.
The same proportion of firms are also engaged and supporting at least one charity or organization that looks to open industry access to a more diverse cohort of young people, such as the IA's talent program, Investment20/20.
Almost half (42%) of firms are signatories to initiatives, pledges or charters that suggest or require action or targets to improve ethnic diversity; while 87% of firms have dedicated diversity networks, supporting employees and shaping, producing and driving change, the report said.
However, more needs to be done — particularly around data since "compulsory ethnicity pay gap reporting is on the horizon," the report concluded.
The report also featured a number of case studies from money management firms and how they have worked to improve diversity and inclusion. Highlighted efforts include by Invesco, which this year launched a global "Count Me In" campaign to give employees the opportunity to self-identify across race/ethnicity, gender identity, sexual orientation, neurodiversity and other demographic categories; and Natixis Investment Managers, which created a dedicated social justice matching gift program, designed to support the efforts of non-profit organizations that work to advance equality for minority groups and promoting social justice around the world.
The discussions with the 24 firms took place between October and December.