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Parker Review sets new ethnic diversity targets for FTSE 350

Following results from the 2022 Parker Review, FTSE 350 companies have been asked to set their own 2027 targets for ethnic minority representation in senior management positions.

The Review's 2022 census found 96 FTSE 100 companies had met the target of having at least one minority ethnic director on their boards. This is an improvement from last year's results, in which only 89 companies met the target.

FTSE 250 companies have made slower progress, although 67% of responding companies had at least one ethnic minority director on their board in 2022, up from 55% in 2021. 

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Is chief diversity officer a ceiling for black employees?

Ethnicity pay gap persists regardless of high company pay levels

The survey results are a valuable reminder for HR professionals to continue to work towards equality of opportunity in their companies.

David Tyler, chair of the Parker Review, said an important way to do this is to collect relevant data.

Speaking to HR magazine, he said: “If companies are to be successful in creating equality of opportunity, they’ll need to know who’s joining the business, who’s leaving, who’s progressing, who’s not, and why.

“So, companies and their HR directors really need to encourage as many of their employees as possible to self-declare their own ethnicity. If this data is available to guide decision-taking, companies are likely to be more successful.”

To maximise ethnic diversity across all levels in business, rather than just board positions, the Review committee has now broadened its focus by recommending target setting for senior management positions, covering executive committee members and the senior managers who report to them. 

By avoiding a one-size-fits-all target, the committee hopes to account for variation in ethnic diversity across the country.

Laura Whitcombe, global campaign manager of gender diversity campaign group The 30% Club, said the results were promising.

Speaking to HR magazine, she said: "The 30% Club is pleased to learn of the progress being made for ethnic minority directors and senior managers. It was particularly encouraging to hear that gender balance is almost being achieved among ethnic minority directors, standing at 48% across the FTSE 350.”

However, she warned, there is still a lot of progress to be made before companies achieve true equity.

In addition to collecting more and better data, Whitcombe suggested taking part in reverse mentoring.

For example, The 30% Club’s Leaders for Race Equity programme matches CEOs with ethnic minority executives, encouraging them to learn from each other's experiences and challenges.

Whitcombe said: “We hope this initiative will help our CEO members deliver impactful leadership in race equity throughout their organisations to ensure a wide pipeline of diverse talent progressing and thriving right to the very top."

The Parker Review Committee was commissioned by Department for Business, Energy and Industrial Strategy in 2015 to consult on the ethnic diversity of UK boards. This edition of the Parker Review Report was conducted through a voluntary census of all FTSE 100 and FTSE 250 companies. 

Companies provided data on the ethnicity of all directors who were members of their boards on 31 December 2022.