A major new initiative has been launched to improve social mobility when it comes to recruitment into senior jobs in the City.
A task force led by the City of London Corporation has created a membership body called Progress Together, which aims to encourage people from less privileged backgrounds into roles across the Square Mile. Its founding members include Accenture, Allen and Overy, Aviva, Axa Health, City of London, Corporation, EY, Fidelity International, Man Group, PwC, Santander, Paragon Bank and Schroders.
Progress Together will organise workshops, resources and mentoring schemes for people who have the talent but who may lack the social networks and more privileged background to reach the top-tier in financial and professional services.
The need for such a body was underlined by the publication of survey results that show of nearly 10,000 people from 50 financial and professional services firms, employees from non-professional backgrounds were 30% less likely to be working at a senior level compared with colleagues from professional backgrounds (defined by parental occupation at 14).
An earlier Bridge Group report showed that 89% of senior roles in financial services were held by people from higher socioeconomic backgrounds (defined by parental occupation at 14) compared with 37% across the UK working population.
The Bridge Group research also found that employees from lower socio-economic backgrounds progressed 25% slower than peers, with no link to performance. The class pay gap in financial and professional services is £17.5k, the largest by sector in the UK.
The City of London Corporation was commissioned by the Treasury and business department in 2020 to find ways to increase socioeconomic diversity in the financial sector.
Catherine McGuinness, former head of policy at the City of London Corporation and chair of the task force, said Progress Together would continue the important work of the Socio-Economic Diversity Taskforce. She said: “The task force conducted hundreds of hours of roundtables and interviews as well as extensive research to identify what steps could help improve socio-economic diversity at senior levels in the sector. The launch of Progress Together will advance our vision of a sector where performance is valued over ‘fit’ and ‘polish’.”
City minister John Glen said the body would work with employers to help them gain insights into the barriers to progress for staff, share best practice, identify emerging issues and push for necessary policy changes.
“Research tells us that the majority of senior roles in financial services are held by those from higher socio-economic backgrounds,” Glen said. “Financial services organisations across the UK, of all sizes, can benefit from this new membership body, ensuring that the government’s levelling up agenda is carried out, delivering equal progress and opportunity for all.”
Richard Rowntree, managing director for mortgages at Paragon, said: “There are too many talented people in the financial services sector that fail to reach senior levels, which is a detriment to the individual firms and the sector as a whole. As an industry, we have to change this.”
The City of London Corporation scheme mirrors initiatives such as the Bright Network’s campaign to get firms such as Lloyd’s Bank, British Airways and Nestlé to pledge to improve social mobility in recruitment.
Last year a study revealed that City law firms had made inroads in improving internal social mobility, while data analysis by organisations such as Pirical and RARE has shown a recruitment strategy based around prestigious schools and universities is not as effective as approaches that promote social mobility.