Black Leaders in Finance
We need more Black leaders in finance. But, where do we start?
In this article we’ll explore just some of the societal issues that act as barriers to entry for Black people trying to access the financial industry and also, illustrate specific workplace concerns that can hinder corporate progression.
Through our own research and commitment to improving diversity, equity and inclusion in our own searches and placements, we’ll outline the ways in which we believe we can help improve the current situation; but, of course we’re not in this alone.
At the end of this article, we have included our favourite organisations, run by some incredible Black leaders, that are already making a huge impact.
Representation Matters
It’s no secret that there is a lack of representation of Black people in the UK financial sector and the most recent data about Black leaders in finance comes from Green Park back in 2020.
Their study found that only 11 C-suite roles in FTSE 100 companies were filled with individuals from an ethnic minority background. However, none of those individuals were Black.
This statistic isn’t acceptable but unfortunately, isn’t surprising.
The Current Situation
A study by the Resolution Foundation (2020) found that there is a £3.2bn pay gap between ethnic minority workers in the UK versus their White peers. However, when you scratch beneath the surface of this statistic it becomes clear that there are some ethnic minorities that are impacted by this gap to a greater extent than others.
For example, per adult, Black African households in the UK typically earn just over £600 per week and Black Caribbean households typically earn just under £500 per week; in contrast, per adult, Asian Indian households earn just under £1,000 per week and White British households take home around £600 per week. There isn’t huge disparity between White British, Black African and Black Caribbean household incomes so, maybe that’s not the problem?
When we then compare White British household incomes to Black African and Black Caribbean household incomes it seems as though there isn’t a great difference between these figures. However, the safety net which generational wealth provides isn’t shared equally between these groups. The Resolution Foundation found that the average family financial assets owned by White British families in the UK is equal to £50,486, whereas, the average family financial assets owned by Black African and Caribbean families is equal to just £10,209. Furthermore, 60% of Black African families and, 49% of Black Caribbean families have less than £1,000 in savings compared to only 28% of White British families.
By having more financial assets and more savings, families are able to provide for and protect the safety of their loved ones with far greater ease than families that don’t experience as much financial freedom. When resources are scarce for a family, naturally it becomes far harder to pursue a career, move up the ladder or access the higher education necessary to win those top positions.
Discrimination in the Workplace
Runnymede (2020) found that even though people from Black and Minority Ethnic (BME) backgrounds are more likely than their White peers to have a university degree, the market value of those qualifications is seemingly less. Nearly 40% of Black African graduates are in non-graduate jobs; showing the obvious barriers that Black people experience when they enter the labour market after graduation.
In a study by EY (2021) it was noted that 87% of Black people in the UK believe that their ethnicity presents a barrier to entry in employment sectors. The same report specifically called out Banking and Finance industries as being sectors that Black individuals struggle to enter due to barriers relating to their ethnicity. So, although there are prominent societal issues that in themselves present as a barrier to entry for Black people looking to access the financial employment sector; the financial industry itself also has a duty to create change.
To further illustrate this point, a study by McKinsey & Co (2022) in the US found that whilst 19% of women of colour occupy entry level roles, only 5% of C-suite roles are occupied by women of colour. Similarly, 19% of men of colour occupy entry level roles, whereas, 13% of men of colour occupy C-suite roles. White men are the only demographic that don’t experience a severe drop off in representation when working their way up the leadership ladder; 33% of White men occupy entry level roles compared to 61% that occupy C-suite roles.
Therefore, aside from the obvious barriers to entry in the first instance, there is also a lack of psychological support available to Black individuals as they progress through the ranks of their financial careers. So, how can the financial industry make real change to support Black talent moving forward?
Inclusive Hiring
At Pearse Professionals, we have a responsibility to positively impact the diversity, equity and inclusion of the industries we service. We partner with our clients across the UK and the USA to create recruitment processes that will improve equal opportunity and diversity to create impactful change within their organisation.
We do this by:
Utilising Diverse Job Boards
Collecting and Analysing Data
Delivering Unconscious Bias Training
Using Blind CV Campaigns
We are committed to always improving our process to create real change in the financial services sector. You can find out more about our process by reading our Diversity, Equity and Inclusion Statement.
Making it Happen
Creating change within the financial industry isn’t going to happen overnight. However, there are organisations that are working to create change at a societal level; which will in turn improve diversity and inclusion across all sectors. Here are just some of these incredible organisations:
Stemettes is a social enterprise based in the UK that works to support girls, young women and non-binary people into Science, Technology, Engineering, Arts and Maths (STEAM) education and career paths. Stemettes was founded by Dr Anne-Marie Imafidon MBE, in 2013 and created a space for young women which is intentionally inclusive and empowers girls from underrepresented ethnic backgrounds. In their recent impact report, it was noted that 60% of Stemette alumni are now continuing to work in STEM fields.
Black Seed Ventures is a seed fund based in Brixton, UK, they are the first seed fund in Europe to only invest in Black founders and be led by Black investors. Black entrepreneurs are underfunded which leads 84% of Black founders in the UK to self-fund at least part of their venture; which disproportionately limits opportunities for Black entrepreneurs compared to their peers. This is why Black Seed Ventures seek to back 30 Black-led startups by 2026 across the UK.
Mission 44 is a charitable foundation founded by Sir Lewis Hamilton, which supports organisations and leaders to empower young people from underserved communities. The foundation focuses on education, employment and empowerment to ensure that young people experience an inclusive future.
Inclusivitii is an Oxford-based consultancy and training service founded by Aduke Onafowokan, a leading diversity and inclusion expert. They provide research-based and evidence-led change management for companies that are serious about fostering an inclusive culture, which promotes diversity and representation.
Target Oxbridge aims to help Black African and Caribbean students and students of mixed race with Black African and Caribbean heritage increase their chances of getting into Oxbridge. Since launching in 2012, Target Oxbridge has helped over 350 students to secure Oxbridge offers; by securing more places for Black students at Oxford and Cambridge, Target Oxbridge believes that more black people will reach the top of our society.
Are you looking to promote diversity in your own company?
To discuss the hiring process with Pearse Professionals, contact us at info@pearseprofessionals.com.
Alternatively we can arrange to meet with you and map out a strategy to fulfil your hiring needs.