Financial-service firms are failing to understand diversity and inclusion (D&I) as crucial culture issues, according to research by the Financial Conduct Authority (FCA).
The City regulator argues that D&I, founded on a culture where it is safe to speak up, is vital to delivering consumer protection and market integrity. It says it wants to see “an inclusive industry where the most capable people are able to progress, no matter what their background, and where diversity of thought is valued”.
However, the FCA reveals many firms’ strategies lack “a clear articulation of purpose and actions oriented to achieving their goals”. Firms are not fully capitalising on the data they collect to identify or track the best remedies for delivering D&I.
“Very few companies seemed to have understood diversity and inclusion as a fundamental culture issue,” the study concludes. “We found much less understanding of, and focus on, building inclusive cultures than on actions to measure diversity and address specific issues.”
None of the firms the regulator looked at “had undertaken substantial work on the diverse needs of their consumer base, though a few had recognised the need for this”.
The regulator complains that few firms have actionable data beyond gender and ethnicity. It also criticises the tendency for them to focus most on improving representation at senior leadership level when the biggest gaps are in junior to middle management roles.