The Financial Conduct Authority has been accused ‘taking an activist approach’ to its diversity policies by a group of Conservative MPs.
The FCA is consulting on a new diversity strategy that says firms can report on “either the demographic characteristic of sex or that of gender”.
The aim of the consultation is to “boost diversity and inclusion to support healthy work cultures, reduce groupthink and unlock talent”. Tougher rules around misconduct and what constitutes bullying or sexual harassment in the workplace was a major part of the consultation paper.
Parts of the strategy, said the MPs, would put women’s rights at risk by urging banks to collect staff data based on self-identified gender rather than biological sex.
The 40 MPs and peers have written to chancellor Jeremy Hunt, and allege the FCA is promoting “pseudoscience and gender ideology” to the detriment of “science, reason and women’s rights”.
They said the proposed new regulations could also skew data such as the representation of women on boards.
The letter, signed by former leader Iain Duncan-Smith among others including former home secretary Priti Patel, claimed that the proposed regulations could lead to companies de-listing from the London Stock Exchange.
Finance sector news
Tesco bank to transfer staff to Barclays
Lloyds of London boss urges greater return to the office
It added that the FCA strategy went against the instruction from business secretary and equalities minister Kemi Badenoch that data should be collected on the basis of biological sex and not self-identified gender.
“The FCA’s proposals promote pseudoscience and gender ideology to the detriment of science, reason, and women’s rights while taking an activist approach to equality, diversity and inclusion,” the letter stated.
“The FCA proposes new reporting and data-collection categories that have no basis in the Equality Act. It suggested that firms collect data on gender identity, a concept that has no basis in science or law.”
They added: “A government quango surely has no remit to promote contested ideology. On what basis?”
The FCA’s consultation on promoting diversity and inclusion, which has now closed, stated: “We propose that firms would be required to report on either the demographic characteristic of sex or that of gender, in line with our requirements for reporting on the diversity of boards and executive management.
“Firms could choose to report on both characteristics on a voluntary basis.
“We propose that firms only have to disclose either sex or gender in order to remain consistent with the listing rule and reduce any additional burden.”
In January, a gender-critical group of campaigners based in the financial sector, who want the FCA strategy to be ditched, wrote to the chancellor to ask him to investigate the watchdog’s move.
The group, Seen In The City, said it feared the salaries of biological men could be recorded as belonging to women, potentially skewing data.
The letter from Seen In the City said: “If the FCA goes ahead with [its] proposals… more companies may abandon collecting sex data and move towards a gender identity approach.
“We believe this would not be consistent with protecting the rights of employees and in particular understanding and tackling structural sexism in the financial sector.”
An FCA spokesperson told Personnel Today: “Our consultation on diversity and inclusion … is aimed at tackling misconduct such as bullying and sexual harassment and supporting a well-functioning, internationally competitive financial sector, through reduced groupthink and unlocking talent.
“We are grateful for all feedback. We will consider responses and the conclusions of the Treasury Committee’s Sexism in the City inquiry and will report back later this year.”
Latest HR job opportunities on Personnel Today
Browse more human resources jobs
Sign up to our weekly round-up of HR news and guidance
Receive the Personnel Today Direct e-newsletter every Wednesday
