The status of ethnic diversity on FTSE boards | David Tyler, Chair The Parker Review

The Better Boards Podcast Series

The status of ethnic diversity on FTSE Boards

It is five years since the 2017 publication of the first report into Ethnic Diversity of UK boards by Sir John Parker and the Parker Review Steering Committee. Over the last five years, we have seen changes in diversity and inclusion, and it is a huge success that as of today, 94 FTSE100 companies have met the target. But while much has been achieved, there can be no grounds for complacency, and it is clear that more needs to happen.

In this podcast, Dr Sabine Dembkowski talks with David Tyler, who has recently taken over from Sir John Parker as Chair of the Parker Review.

David Tyler is currently the Chair of Domestic & General, The White Company and Imagr. He is one of the most respected and admired Chairs in the UK, having also served in this role at several other companies, including Sainsbury's, Hammerson and Logica.

Some of the key takeaways of the conversation include:

"I hope listed companies can be a beacon for other organisations"
Since 2017, the number of FTSE 100 companies with someone from an ethnic minority background on the board has doubled, from 47% to 94%. In terms of directorship, this has also doubled, from 8% to 16% directors.

"What's important is the mindset's changed"
David outlines how diversity is important in a wider cultural sense. The benefits of diversity around the board table are now largely accepted, with many companies wanting to show their employees and outsiders that people from ethnic minorities can succeed.

"Only when you have the data can you do something about it"
Firstly, companies need to know their diversity data, which means that people need to self-declare how they identify. This enables a company to monitor percentages of any particular group of people, such as those at executive committee level. Without this data, it is impossible to measure your position and progress, understand who is leaving, progressing well in the company, and why.

"Show the direction you're going"
Secondly, targets for minority ethnic participation need to be set – and not just at board level, which the Parker review focussed on.

"You don't have to reinvent anything"
Third, David feels the heart of what companies need to do is to create if they don't already have it, an inclusive culture throughout the organisation. This is a culture where everybody feels safe, secure, and valued and where everybody experiences fair and happy working conditions.

"From little things, big issues can arise"
Fourth, David warns that 'microaggressions' must not be tolerated. Examples of these might include ignoring people from a different ethnicity, not looking them in the eye, interrupting them, and allowing inappropriate or even hurtful "banter," and so forth. Good companies should not tolerate such behaviours.

"Get the tone from the top set in the right way"
Finally, he advocates that management needs to be seen as driving this issue forward from the top, believing that if people in senior positions show they are working at this, others will follow their example.

The three top takeaways from our conversation are:

1. Companies that are more diverse are more likely to succeed because there is more room for debate and less potential for 'groupthink.'

2. A more diverse company reflects a more diverse society. It is not just about profit but also about contributing to society, showing that anyone can succeed, and encouraging more people to engage.

3. This can both enhance the economy and make companies more competitive.