FRC wants more diversity at top of profession

The Financial Reporting Council (FRC) is calling on accountancy firms to prioritise increased diversity at the most senior levels of management, with partners being the least diverse when it comes to gender, ethnicity and disability, according to its latest report on the profession

The FRC’s Key Facts and Trends in the Accountancy Profession report, due out later this week, shows a mixed picture.

For the first time in five years, women now make up 50% of all students at the professional bodies and 37% of members.

However, at the largest firms (those with over 2,000 employees), less than 20% of partner positions are held by women, unchanged from the previous year.

The FRC notes encouraging signs that change is underway with women now making up 56% of manager roles at smaller firms.

The regulator said it found BAME individuals only made up 6.7% of partner roles at the largest firms and glaringly no firms with under 200 employees reported that they had BAME managers.

In comparison, the data for the previous year found over 3% of the smallest firms had BAME employees at this level. 

The percentage of BAME managers at medium-sized (200 - 2,000 employee) firms has also dipped.

The FRC’s analysis shows all of the professional bodies have diversity policies or statements in place.

However, three of the 20 audit firms questioned (15%) still do not have a diversity policy in place. The regulator said there is no valid reason for firms to not have a diversity policy and urgent action is needed on this front.

The FRC said a high percentage of accountancy bodies continue to collect data on the age, race and sex of their members and students, but there has been a decrease in the number of bodies collecting diversity data in respect of disability and race/ethnicity.

Sir Jon Thompson, FRC CEO, said: ‘Firms have a responsibility to ensure they are leading by example on diversity and inclusion and that they have appropriate policies in place to address any shortcomings.

‘While this year’s findings reveal that some progress has been made, firms without meaningful policies in place are dropping the ball.

‘It is clear progress needs to be fast-tracked so that the senior management of firms more closely reflects the wider workforce it represents.’

Accountancy Daily’s diversity survey, BAME 2020, revealed that there are currently only 17 black partners among the top eight accountancy firms (ranked by fee income) of PwC, Deloitte, EY, BDO, Grant Thornton, RSM and Mazars.

Further reading:

Click here for Accountancy Daily’s - BAME firm survey 2020 - which analyses ethnic diversity within the UK’s top accountancy firms, data reveal partners and staff remain overwhelmingly white while Black Lives Matter movement forces concrete action.

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