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In the 1970s there were job ads that said things such as ‘Come and join our organisation; we have careers for the boys and jobs for the girls’,” recalls diversity expert Binna Kandola. “Looking back, it seems shocking to the point of being comical”

It’s precisely because those advertisements now seem ridiculous that Kandola, a consultant who has been working in the diversity field for more than 20 years, thinks they illustrate perfectly how far we have come in encouraging difference in the workplace. And he believes we could see a similar culture change in the years ahead. “In 30 years’ time we may look back at current adverts and practices and think how strange it was that we could ever stipulate an age range in an advert,” he says.

Attitudes towards diversity have undoubtedly changed, but it has been a slow process. While this month marks the thirtieth anniversary of the Race Relations Act 1976, race laws were actually introduced in the UK way before then – 11 years before – in an effort to stamp out routine discriminatory practices in public life, such as barring “blacks” from restaurants or pubs. In 1968 the law was strengthened to make discrimination in areas such as employment illegal. That legislation in turn was replaced by the 1976 act, which had more teeth.

Laws addressing gender diversity have been in place since 1970, when the Equal Pay Act came into force, to be followed in 1975 by the Sex Discrimination Act. Since then, a whole raft of laws have brought protection against discrimination on grounds of disability, sexual orientation, religion and belief and, most recently, age – the first discrimination law with relevance to everyone, rather than a substantial minority (see below). So, in theory, if not always in practice, for more than 35 years now businesses have had to think about how they manage and treat groups that don’t fit into the dominant white male category.

And that time has seen no shortage of controversy around equality issues. Events hitting the headlines have ranged from the Macpherson inquiry into the Stephen Lawrence murder investigation – which branded the Metropolitan Police institutionally racist – to a series of high-profile sex discrimination cases, such as that of Julie Bower, who won a payout of £1.4 million from her former employer, Schroder Securities. More recently, the issue of wearing religious clothing or symbols at work has been front page news, with the case of Aishah Azmi, the Muslim teaching assistant who refused to remove her veil in class, being one notable example.

Away from the glare of the media, what progress have organisations made on the ground? One important shift since the 1970s has been in the reasoning behind attempts to ensure that minority and marginalised groups are not excluded from the workplace. While, at first, the emphasis might have been on mere legal compliance, the past 15 years have seen a radical reshaping of attitudes, with organisations starting to recognise that there is real business value in having a heterogeneous workforce.

As Kandola explains: “In the early days it was about equal opportunities (EO), quotas and targets, mainly to increase ethnic minority and female representation because legislation existed to cover these groups.

“Then in the 1990s from the US came diversity. At first, for many it was nothing more than a change of name. But actually it provided an opportunity to refresh thinking to enable organisations to take a better perspective.”

Kandola says that while public-sector bodies led the way in the EO agenda, it was the private sector that took up the mantle of diversity, which was business-case driven. “Diversity is not about legislation, nor a numbers game. It is about a change of culture and environment,” he adds.

Dianah Worman, CIPD adviser, diversity, agrees that managing diversity is very much a cultural issue. Rather than it being about trying to achieve “fairness” at work for certain groups of people, she believes it is about valuing each person as an individual.

“We talk more about inclusion now, which is a dynamic, she says. “It is not about visible or non-visible traits or characteristics such as race or gender, sexuality or disability, which can all be stereotyped. It is about celebrating difference as an asset, since everyone is unique, and recognising that everyone can make a contribution.”

The benefits that a diverse and inclusive workplace culture can bring have been well-documented by the CIPD. It can aid recruitment and retention of talent as well as enhance competitiveness, since different perspectives can open up new market opportunities and broaden an organisation’s customer base. Encouraging diversity can also improve corporate reputation because – business considerations aside – it is the ethical thing to do and helps to create unique mixtures of talent, skills and experience that can contribute to business performance.

Practitioners, academics and managers report another key advantage to creating an inclusive culture: people who feel accepted at work can achieve higher performance levels. This was one of the key findings of a study published this summer of lesbian, gay and bisexual workers among 16 “good practice” employers.

The study, Lesbian, Gay and Bisexual Workers: Equality, Diversity and Inclusion in the Workplace, revealed that managers from all sectors recognise a link between people feeling accepted at work and their performance. Rather than staff putting their energies into hiding their true selves or dealing with stress, they are more relaxed and better able to get on with the job. In the case of the LGB workers, the issue was around employees feeling secure enough to “come out” at work. As one senior manager from the voluntary sector taking part in the study, said: “If you are not out, how do you share anything about your personal life? How can we get our lesbian and gay staff to be higher performers if they are so unable to open up, [which is] a key part of what makes them good performers.”

Fiona Colgan, co-director of the Comparative Organisation and Equality Research Centre at London Metropolitan University (LMU), which carried out the study, told PM that this was about “people feeling comfortable to be themselves at work” – something that applies to all employees, not just certain groups.

The business case for diversity may have become well established, as has an understanding of the theory behind the concept. But how far organisations are taking it seriously and realising the benefits themselves is another matter.

The Workplace Employment Relations Survey 2004 (WERS), a DTI-sponsored national longitudinal survey of people at work published this year, reveals that 73 per cent of workplaces now have a formal written equality or diversity policy, compared with 64 per cent in 1998, when the last WERS study was carried out. The most commonly covered grounds are sex and race, where the laws are long-standing, but there has also been an increase in the number of workplaces with policies on religion, sexual orientation and age since 1998.

However, Linda Dickens, professor of industrial relations at Warwick Business School, points out that “despite employees in Britain being diverse, this is not fully reflected in British workplaces”. The Wers survey shows that in 58 per cent of workplaces with at least 10 workers, three quarters are of the same sex; 56 per cent of these workplaces do not have any ethnic minority employees and 81 per cent have no disabled employees.

“Such employees are unevenly distributed across sectors, as are women and older and younger workers,” says Dickens.

Other statistics make equally gloomy reading. According to the latest government figures, the gender pay gap (measured by the difference between men’s and women’s hourly pay), though shrinking, is still 12.6 per cent. At the same time, unemployment is twice as high among people from ethnic minorities as among the wider population, despite there being more Chinese, Indian and black African graduates than white graduates. Similarly, only 50 per cent of disabled people of working age are in employment, compared with 81 per cent of people who are not disabled. As for lesbian, gay and bisexual workers, the LMU study revealed, for example, that respondents are allowing their careers to be influenced by geographic location since some areas are deemed more “gay friendly” than others.

Yet the pressure to be more inclusive is set to intensify, as society becomes more and more heterogeneous (see panel, above). Dickens, who is currently researching the development of British anti-discrimination law since the 1970s and its impact on employment practice, admits: “There has been some progress towards workplace diversity, but the pace is slow.”

Professor Naina Patel, who heads the Policy Research Institute on Ageing and Ethnicity (Priae), agrees. One of the institute’s current projects, Cemesme (Contribution of ethnic minority employees to SMEs), aims to promote racial equality in employment and help British firms become more sensitive to the diversity agenda.

The initial findings of research into 297 SMEs show, however, that “SMEs do not perceive that ethnic diversity has any positive effects on business”.

“If we had started the journey on race relations only a few years ago, I would say organisations were doing well. But this issue has been promoted for more than 30 years,” says Patel, whose organisation is to produce an HR toolkit on CD-Rom next year to help employers manage diversity.

Some of the barriers to faster progress are all too obvious. “Diversity is a very complex area, because it works at so many different levels,” says Worman, who cautions that things won’t improve overnight.

The complexities around this issue include the fact that people cannot be neatly categorised into one or other group: in reality, people have multiple identities. At grassroots level, diversity is also often seen as being simply about “political correctness”.

Equally worrying are the interim findings from a CIPD report, Diversity in Business: How Much Progress Have Employers Made?. These show that one reason for the slow rate of progress is that much activity is still driven by legal compliance, rather than business-related reasons. Of the 285 individuals involved in diversity management questioned in this survey, 68 per cent admitted that legal pressures were the key driver for work on diversity in their organisations. These pressures were also the top reason for progressing the diversity agenda, as cited by 32 per cent of respondents. Only 17 per cent said the most important reason for progressing diversity was because it “made business sense”.

The survey also highlighted gaps between policy and practice. While 93 per cent of organisations said they had a diversity policy in place, activities used to promote diversity in the workplace were mainly centred on training, which has a limited effect in bringing about lasting culture change. “Activities that would help to make diversity management a mainstream business issue are less common,” the report said. Most respondents admitted that diversity achievements were not rewarded and recognised and were not built into organisational goals.

The report concludes that: “Having a diversity policy is neither a signal that organisations understand the inclusive nature of diversity, nor that it’s a mainstream business issue that goes beyond people management policies and practices.”

Despite these findings, there is still a lot to be hopeful about. “It isn’t all doom and gloom,” says Ashley Norman, head of equality and diversity and employment partner at law firm Pinsent Masons. “The laws have facilitated and sped up organisations’ action on diversity. When employers face new laws, the initial response is only about compliance. But we have found that when they become absorbed into the way the business operates, managers do see the business benefits. The age laws may puzzle and perplex people now, but in a few years the benefits will be realised. Employers are making some progress.”

Hilary Wiseman, former head of diversity for UK and Europe at HSBC, and now managing director of Wiseman Consulting, says that while the pace is slow, she is “heartened in many cases” by some of the work going on. She gives the example of British Gas, where a focus on age is being replaced by one on capability in its traineeships and apprenticeships. She notes that at HSBC, inclusion has left its mark not only on the employee side but also right the way through the company’s advertising campaigns.

Sarah Churchman, director of diversity and student recruitment at PricewaterhouseCoopers, points to a number of initiatives complementing the compulsory diversity training that every one of its UK employees has to take. For example, the firm has set up network groups for people of different faiths and for parents, women and gay and lesbian people. The chairs of these networks work with the diversity team, feeding in action points or ideas.

In a bid to bring about further cultural change, PwC has just begun a trial of a reverse mentoring scheme, jointly run with consultants Brook Graham, which involves a senior member of staff being mentored by a more junior colleague from a minority or marginalised group.

“Our staff are aware of diversity, but it means nothing if people don’t see any manifest change as a result,” says Churchman. “This voluntary scheme will, I hope, help us to deliver greater behavioural change; it is about getting people to relate to others who aren’t like themselves. We anticipate that it will help people to better understand the value of difference.”

Just under a year from now, the new Commission for Equality and Human Rights (CEHR) will go live, bringing together the work of the existing commissions for race, gender and disability. The new body’s remit will also include sexual orientation, gender reassignment, religion or belief, age and human rights. Arguing that “diversity management activities in organisations remain at a very superficial level” and that organisations are failing to see how diversity can enhance business performance, the CIPD has urged the CEHR to address these weaknesses through more support and education.

There are concerns that this new institution will dilute the work of the specialist bodies. But others see great potential. Warwick Business School’s Linda Dickens says it heralds a new way of tackling employment inequality, replacing the existing piecemeal approach and moving towards greater “inclusiveness, integration and intersectionality”.

“There is an opportunity that may or may not be grasped fully to address the limitations that remain in British equality law, while potentially also providing a better fit with the contemporary nature of employment and employers,” she concludes. It’s a tough goal.

A short history of anti-discrimination law

  • 1970 – Equal Pay Act
  • 1975 – Sex Discrimination Act
  • 1976 – Race Relations Act
  • 1995 – The Disability Discrimination Act
  • 2003 – The Employment Equality (Sexual Orientation) Regulations and the Employment Equality (Religion or Belief) Regulations
  • 2006 – Employment Equality (Age) Regulations

The changing face of society

  • The labour force is ageing. In 2020 there are expected to be 21 million people in the “prime age” category (25-49 years), the same number as in 2005, while the number of people aged 50 and over is expected to rise from 19.8 million in 2005 to 24.5 million in 2020 – an increase of 23.5 per cent. (Source: National Statistics)
  • The rise in female participation in the labour market is set to continue, although by a declining rate. By 2020, the labour force will comprise 53.3 per cent men and 46.7 women. (Source: National Statistics)
  • Between 1991 and 2001, Great Britain’s ethnic minority population grew from 3.1 million people to 4.6 million. (Source: National Statistics)
  • 2005 saw the largest ever influx of foreign workers to the UK, totalling some 400,000. Foreign migrants made up 5.4 per cent of the employed population last year. (Source: Migration Research Unit, University College London)

Further Information

  • Managing Diversity: Words into Actions, a CIPD briefing based on case studies, is available from the institute’s HR and L&D Database
  • The survey, Diversity in Business: How Much Progress Have Employers Made? First Findings, is also available from the institute’s HR and L&D Database
  • The Policy Research Institute on Ageing and Ethnicity: www.priae.org
  • The Commission for Equality and Human Rights: www.equalityhumanrights.com