How the financial services industry can support black leaders of tomorrow

27 Oct 2020

Creating a diverse workforce has moved to the top of the agenda for companies around the world recently following long overdue discussions on systematic racism, argues Justin Onuekwusi, a co-founder of the #talkaboutblack campaign.

While some organisations have been trying to create a more inclusive environment for some time, it is clear that taking the necessary steps from good intention to real change has been a significant and common challenge.

Too often companies remain trapped in the enquiry and listening stage rather than implementing the recommendations that arise from them.

The financial sector, including the pensions and investments industry, has made some encouraging moves in awareness and representation but we must not see this as a fait accompli. Even with our breakthroughs, the UK asset management workforce woefully underrepresents the diversity of the UK population.

For example, 13.3% of Londoners are black. But at asset management companies – which are mostly London-based – only 1% of employees are black. To put these figures into something more tangible and shocking – according to a report by New Financial (Diversity in portfolio management) there were only 12 black portfolio managers in the UK in 2018. This surely begs the question: why?

Kinks in the hosepipe

Black people are underrepresented in financial services not because they are inherently less talented, intelligent or hardworking. That is clear. There are four drivers of this inequality – or ‘kinks in the hosepipe’ – that keep black people out of the industry, deny them of certain opportunities and stop them from progressing.

Pipeline – The socio-economic environment that many UK-born black people are in makes social mobility incredibly difficult. The poorer you are, the less likely you are to get a good education. The stats also show that the education system lets black people down with teachers expectations being low which manifests itself in black students being the most likely ethnicity to have their grades under-predicted by teachers and black British Caribbeans being more than three times more likely to be excluded from school.

In the UK, this affects black people significantly more than white people as they are twice as likely to live in poverty. All of this makes it even harder to secure professional jobs because they may not have the necessary requirements.

Entry – Black people who get a good education are still less likely to secure their preferred job and this problem is twofold. Not only are black people not getting through when they do apply, but they are also put off from applying to certain industries in the first place. This is because they don’t see people who look like them. Role modelling is a bit of a self-fulfilling prophecy in this regard – you
can’t be what you can’t see.

Progression – If black people do enter the industry, they typically end up in support functions and find it incredibly hard to progress to leadership or revenue-generating positions. Currently, I know of only three heads of distribution who are black and only two black professionals in Csuite positions.

Taboo – Whilst people are becoming increasingly comfortable discussing issues relating to gender and sexual orientation, race remains a taboo subject, which stifles discussion which is necessary for change.

Unwinding the kinks

To address these challenges, #talkaboutblack has created several initiatives, including events, panel discussions and media initiatives, to break the taboo and keep the conversation going. We are also building programmes and mentor schemes to help black school children and young professionals to enter the asset management industry and progress to Csuite jobs.

The #talkaboutblack ‘EnCircle’ mentoring circles for those that have up 10 years’ experience have been fundamental in helping career starters establish a sense of belonging in the industry, share experiences and receive advice from senior role models.

But we all have an important role to play. To genuinely embed diversity, I believe it is down to all ethnicities to build a more inclusive corporate culture. That begins by ridding ourselves of the much maligned BAME acronym and understanding the lived experience of different ethnic groups in the workplace; considering all ethnic minorities in aggregate risks ignoring the different experiences of each community and individual. Companies must also showcase role models from different backgrounds and can support communities that have historically been under represented in business and management.

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