The Equity Effect report - Henley Business School Finland

Businesses who treat employees unequally based on race, report up to 58% higher income

New research finds companies that have targeted measures specifically to support ethnic minorities record higher revenue and greater staff output and loyalty. Despite this, racial discrimination is still rife in British business with Black employees found to be worst off. White business leaders are significantly less likely to have recognised discrimination in their workplace compared to ethnic minority leaders.

More and more British businesses are providing targeted support to ethnic minority employees in order to bring them to an equal footing to their White counterparts and achieve racial equity; defined as striving to promote fairness by treating people differently depending on their need. According to new research from Henley Business School, these organisations are also recording on average 58% higher revenue than those who are not.

Along with this, the research showed that these businesses are also more likely to benefit from enhanced staff loyalty and creativity, also ultimately leading to value.*

Despite this progress however, Henleyโ€™s research showed there are still fundamental issues to address in eliminating racism in the workplace and Black employees remain the worst off. Theyโ€™re more than twice as likely to experience racial discrimination compared to Asians and mixed ethnic minorities (19% vs 9% and 8%).

In terms of how this manifests, the leading form of discriminatory action cited by ethnic minorities is discrimination in work allocation (41%). Verbal abuse is second (33%), and following this, for itโ€™s Inappropriate and unfair application of work policies or rules (29%).

When it comes to recognising the racial inequity, White business leaders are significantly less likely to have seen discrimination in their organisation in comparison to those from an ethnic minority background (30% vs 47%). It therefore doesnโ€™t bode well that 70% of those surveyed said their senior leadership was White.

โ€œRacial equity and business success should not be separate conversations. It is critical to any organisation wanting to achieve its aims and ambitions in this challenging world of work. Of course, we all want to say that racism has no place in business, education or society. But the experience of the pandemic and social movements like Black Lives Matter have shown us that we need to shift our organisational, cultural thinking to ensure we work on racial equity โ€“ not just because it is a good thing or seen as worthy, but because it is valuable and essential to organisational success.โ€

Lead researcher, Dr Naeema Pasha, Director of Equity, Diversity and Inclusion at Henley Business School

Research conducted by Henley Business School included quantitative research with 1,005 employees and 505 business leaders, qualitative research with business leaders and research of publicly available sources.

* Uncovered through Relative Importance Ranking (a statistical analysis) to assess the drivers of job satisfaction, creativity and loyalty

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