Deloitte’s ethnicity pay gap remains static

Big Four accounting firm Deloitte has reported a slight improvement in its ethnicity pay gap, as it declined from 43.9% in 2018 to 43.5% in 2019

The study takes into account earnings for the whole firm, including equity partners, and is produced on a voluntary basis as part of Deloitte’s commitment to transparency and encouraging change.

Two years ago Deloitte published a target to ensure that 10% of its partners would be from an ethnic minority by 2021, in line with the Parker Review. It also set out that its executive committee will have at least one BAME member, and each of its business leadership teams will include at least one BAME member.

The 2017 Parker Review considered how to improve the ethnic and cultural diversity of UK boards by setting objectives and timescales for the FTSE 350 to aim towards to improve ethnic diversity.

The ethnicity pay gap shows the difference in the average hourly rate of pay between black, asian and minority ethnic (BAME) and non BAME employees and is expressed as a percentage of average non BAME earnings.

Deloitte’s executive board has agreed an ethnicity action plan setting clear actions focused on attracting, developing and retaining ethnic minority employees. This is underpinned by an ongoing focus on ensuring an inclusive workplace culture.

In June 2019 just over 10% of those promoted to partner were from an ethnic minority. While people from an ethnic minority made up 25% of Deloitte’s overall workforce in April 2019, only 6% of partners and 11% of directors (the grades attracting the highest levels of remuneration) were from an ethnic minority.

Dimple Agarwal, managing partner for people & purpose at Deloitte UK, said: ‘Deloitte’s ethnicity pay gap is due to the lower proportion of ethnic minority people holding the most senior positions within the firm, an issue that we are continuing to address.

‘We believe that transparency, combined with targeted action and engagement in the public debate around inclusion, can make a real difference in tackling some of the challenges we face around diversity. We want to ensure the firm is representative of the society in which we operate and the clients we serve.

‘Since 2017 we have had a dedicated ethnicity action plan to address this imbalance. Meaningful and sustained change takes time but we are starting to see the results of some of our actions. This year we’ve seen a rise in the proportion of ethnic minority promotions at partner level and an increase in the number of ethnic minority students applying to join our firm, both encouraging signs that our actions are starting to have an impact.’

Last year Deloitte piloted a reverse mentoring programme, pairing junior women and employees from an ethnic minority with partners from a different business area. The pilot programme received very positive feedback and the programme has been doubled in size in 2019 and also extended to LGBT+ employees.

Agarwal said: ‘The pay gap report shows that we still have some way to go and that’s why we are fully committed to providing an inclusive working environment, alongside the targeted actions to help achieve the balance and diversity of thought we want to have in our firm.

‘We are proud to have been one of the first organisations to sign the Race at Work Charter developed by the government and Business in the Community in October 2018 and to have contributed to the government consultation on ethnicity pay gap reporting.’

The Race at Work Charter was announced during PM Theresa May’s term in October 2018, and aimed to commit businesses to a bold set of principles and actions designed to improve the recruitment and progression of ethnic minority employees.

The five principles for the Race at Work Charter consists of appointing an executive sponsor for race, capturing ethnicity data and publishing progress, committing to zero tolerance of harassment and bullying at board level, making clear that supporting equality in the workplace is the responsibility of all and taking action that supports ethnic minority career progression.

Race equality in the UK will potentially bring a £24bn per year boost to the economy, at 1.3% GDP which works out at £481m a week, according to the Business in the Community statistics.

Deloitte continues to focus on increasing its disclosure rates, in particular among new joiners to the firm, in order to ensure that its calculations are reflective of the whole organisation and they can better track year-on-year trends.

They have received awards for their efforts, including UK chairman Nick Owen who was named top advocate executive at this year’s EMpower awards, a body which showcases business leaders who are breaking down barriers at work and playing a big part in breaking barriers for ethnic minorities in the UK.

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