· News

Ethnic diversity in FTSE 100 companies continues to grow

One in five working-age adults is from an ethnic minority background, according to Business in the Community

Nearly all (97%) of FTSE 100 companies now have at least one director from an ethnic minority background on their board, a study by Thomson Reuters Practical Law has revealed.

This increased from 84% in 2022.

The study findings, released yesterday (4 March), show that companies in the FTSE 250 have also improved representation by 55% from a year ago, as 73% now have at least one director from an ethnic minority background.

Sandra Kerr, race director at Business in the Community, reminded HR magazine that it is mutually beneficial for employees and employers to ensure that their organisation is ethnically diverse.

Read more: Lack of diversity more expensive than ever

She said: "With one in five working-age adults in the UK coming from a black, Asian, mixed race or other ethnically diverse background, it is essential that the UK workforce is representative of the wider population at all levels across organisations. 

“Having a diverse workforce can lead to significant business benefits, as research shows it is linked to greater productivity and innovation.”

Paul Sesay, CEO and founder of inclusion network Inclusive Companies, told HR magazine that having diverse leadership helps to attract diverse talent across organisations.

He said: “Having representation at the top level gives other people from the same diverse background someone to look up to, encouraging retention and recruitment.

“Meanwhile, having ethnically diverse talent at all levels of an organisation promotes a truly inclusive workplace and an enriched culture.“

Sesay added that employers should create an inclusive culture to retain diverse talent.

Sesay said: “Experience shows that representation without inclusion will see people from diverse backgrounds leave an organisation.

“Form ethnically diverse networks to bring a sense of belonging, and put in place mentors to encourage people to fulfil their potential.

Equity is key to retaining diverse talent. To achieve inclusion, people must not just be given a seat at the table, they should be given a voice and have their views both heard and considered.”

Read more: Building decent work for ethnic minorities, part one

Frank Douglas, CEO of HR consulting firm Caerus, warned HR magazine that better representation of diverse talent doesn’t ensure representation for all.

He said: “It is encouraging to observe an increase in ethnic minority representation, particularly among Asian communities, on corporate boards.

“However, a significant disparity persists at the C-suite level, where black executives remain scarce, representing a concerning gap in the pipeline for non-executive roles. 

“Currently, none of the FTSE 100 companies have black individuals serving as board chairs, CEOs, CFOs or CPOs.”

Douglas added that employers should ensure they tailor their DEI efforts to each ethnic minority group.

He continued: “It is imperative to recognise that 'ethnic minority' is not a homogeneous category; there are distinct experiences among black Britons, black Africans, Indians and Chinese staff, for example.

“To achieve balanced progress, organisations must segment their employees and implement equity-focused interventions tailored to address the unique challenges faced by each group.”