The FCA report on approaches to Diversity & Inclusion in financial services
Nick Goddard
The Financial Conduct Authority (FCA), who regulate the conduct of 50,000 firms in the UK, published a report in December 2022 on the approaches to D&I (Diversity & Inclusion) in financial services. In this report, the FCA observed how financial services firms are designing and embedding D&I strategies and detail initiatives that industry leaders can consider in reviewing their own strategies.
Some of their key findings that we found interesting are:
· Very few firms seem to have understood diversity and inclusion as a fundamental culture issue. Generally, the FCA found much less understanding of and focus on building inclusive cultures than on actions to measure diversity and address specific issues.
· The firms that the FCA spoke to are most focused on addressing gender representation, with ethnicity now starting to receive more attention. Other demographic characteristics receive much less attention. This is certainly in line with ABSTRACT’s own experience of working with clients in this sector.
· By and large, firms were open and candid about the challenges they are facing and are focused on achieving meaningful progress. However, they saw evidence that a compliance based approach, rather than a genuine commitment to diversity and inclusion, is driving some firms strategies.
The FCA found that some firms had launched numerous initiatives but had yet to see substantial improvements and suggested that possible reasons for this might be:
> Diversity and inclusion initiatives take longer to deliver a visible impact than expected.
> Diversity initiatives alone, without meaningful cultural change driven from the top to embed them and drive inclusion, will not tackle
diversity effectively.
> Some diversity and inclusion initiatives are not effective in delivering change.
It was the FCA’s view that firms are likely to struggle to make sustainable, meaningful change without greater attention to culture, including a long-term plan to deliver change, backed by senior level commitment.
At ABSTRACT, we are working with leading organisations to close the gap between good intention and desired outcomes through cultural transformation. We develop leaders to cultivate a new level of awareness and create an environment of conscious inclusion. We will help to reshape your thinking and inspire you to take action. Get in touch to find out how.
Resources:
FCA: Understanding approaches to D&I in financial services
ABSTRACT: Equality, Diversity & Inclusion Development
https://www.abstractuk.co.uk/equality-diversity-and-inclusion-development
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