Challenge for change
The 30% Club UK Investor Group has issued a statement addressing the lack of racial and ethnic diversity in UK business and outlined the action it is taking to make positive change.
“As institutional investors, we can contribute to addressing these inequities by taking concrete steps to promote diversity and inclusion across our portfolios and within our organisations,” it states.
Members of the group who have signed up to the statement have more than £11 trillion assets under management.
The group has sent letters to the FTSE 100 companies its independent research suggests have still to meet the Parker Review targets of at least one board member and executive committee member from an ethnic minority background. They were meant to have done so by the end of 2021.
The letter warned the companies that investors may consider voting against companies at their annual general meetings if they fail to take action.
The Investor Group is committed to actively engage with UK company board chairs, nomination committees and executive teams on the issue of racial inequality in their leadership ranks and workforce.
The publication of the statement builds on the UK chapter of the 30% Club introducing race and ethnicity targets in July 2020. Those targets include members of the Club across the FTSE 350 having at least one person of colour at board and executive committee level by the end of 2023*. And as the 30% Club campaign is focused on gender, we expect at least half of those appointments to go to women of colour.
While the 30% Club works directly with CEOs and Chairs to encourage change, the Investor Group’s been working on improving the availability of data on race equity within the FTSE 100 by engaging with ESG data providers and supporting the creation of new data platforms, such as through its partnership with Diversio.
The Group is also running a race equity training programme for its members to ensure that all investors, big and small, are equipped to take action with the companies they invest in.
Diandra Soobiah, co-chair of the 30% Club UK Investor Group, said: “Diversity and inclusion in companies are integral to sound corporate governance and corporate culture. As long-term investors, we see the failure to take diversity seriously as a stark warning about the long-term sustainability of the company.
“Time is up for organisations that seek to simply tick boxes. The 30% Club Investor Group is putting FTSE companies on notice – the laggards need to do much better, and we’re willing to help.
“We all have an important role to play to ensure persistent race inequities in business and our society are addressed. As investors, we can have stronger dialogue with the companies we invest in, with a view to improving diversity and inclusion within companies in the UK.”
Ann Cairns, global chair of the 30% Club, said: “The 30% Club’s UK Investor Group issuing this statement is a significant moment for the UK investor community. With ESG rightfully gaining prominence in the board rooms and executive offices of the world’s biggest companies, addressing racial inequity is imperative for all asset managers.
“It could make a major contribution to delivering the change businesses, economies and societies so desperately need to see. I am tremendously grateful for the hard work done by the co-chairs and members of the 30% Club UK Investor Group to take a stand on racial inequality.”
*The 30% Club’s UK chapter set the 2023 deadline for the FTSE 350 as a stretch target for our FTSE 350 members to help meet the Parker Review target by the end of 2024.
Where we are
The 30% Club has come a long way from when it was set up in the UK in 2010.We now span six continents and more than 20 countries. We’re actively expanding into more G20 countries