What advantages do FTSE100 firms believe they

can gain from workforce diversity?

Ragaam DashtiDated: April 2014.

Abstract: Diversity initiatives begin as to fulfil the governmental

regulations for anti-discrimination against the gender and

ethnic minorities in the USA and currently, gained momentum in

many countries as a business advantage. My research consists

of analysing around 20 FTSE100 companies to illustrate what

advantages multinational corporations do believe that they can

gain from having a diverse workforce. My conclusion on the

bases that these 20 companies do recognise that diversity does

have business benefit in one way or the other, however, there

were some companies which seems to have not diversity

initiatives in place.

ContentsAbstract:............................................................2Introduction:........................................................3Personal Interest:...................................................5Literature review:...................................................6Analysis of the FTSE100 companies website diversity statements:.....13Aberdeen Asset Management PLC:......................................13Admiral Group Plc:..................................................14Barclays Plc:.......................................................14BHP Billiton Plc:...................................................15BSKYB:..............................................................16Burberry Group Plc:.................................................17EasyJet PLC:........................................................17HSBC Holdings PLC:..................................................17Intertek Group PLC:.................................................18Standard Chartered PLC:.............................................18Wm Morrison Supermarkets PLC:.......................................19Lloyds Banking Group PLC:...........................................19Conclusion:.........................................................20Methodology:........................................................21References:.........................................................21

Introduction: In the United Kingdom organizational policies and attitudes

have traditionally been concerned to solve the issues of

inequality by the implementation of the procedures and legal

requirements for the employers to be applied uniformly to all

employees, regardless of gender, race, disability and so forth

(Kirton and Greene, 2010). In the UK the development of

equality policy thus date back to the late 1970s which was

highly influenced by the anti sex and race discrimination

legislation of that period. However, this equality policy

legislation seem to have played a very important role in

drawing attention to the then inequalities in the employment,

therefore 1970s legislation helped placing equal opportunity

policy in the issues on the policy agendas of the UK

organizations (Liff, 1995). This equal policy opportunity is

known as ‘equal opportunity’ (EO), which aims to ensure that

this law is being implemented by the employers, however, many

commentators in this flied argue that organizations actually

do very little to promote equality and diversity. According to

Liff, organizations usually produce a statement latter or

statements are posted on the companies’ websites claiming to

have a diversity policy in place but do no more than this, on

the other hand other organizations appears to develop

diversity policies and clearly articulates the policy aims and

objectives and intended benefits. Nevertheless, according to

Kirton and Greene, moving forward to this narrow authoritative

of the legal procedures and requirements, authors have come

across two broad policy directions, first is the social

justice case which seems to have a strong connection with the

EO policies and secondly, the business case which is more

recent and appealing is associated with diversity management

policies. This paper will elaborate the business case by

looking into FTSE100 companies’ corporate diversity agenda. I

will illustrate whether these multinational firms in UK

believes that they can gain advantages from having a diverse

workforce.

This shift from equal opportunity (EO) to diversity management

(DM) in practice means that EO approach is focused on the

social justice case, while DM appears to have shifted that

focus towards business case. Initially, EO has been concerned

with developing policies such as, non-discriminatory

employment practices, procedures and ways to tackle

discrimination in workplace. However, on the other hand,

diversity management has been portrayed as proactive way of

capitalizing on the different skills, qualities and the notion

that multiple viewpoints can offer better and more innovative

ideas (Lee and Nathan, 2010, and Kirton and Greene, 2010). In

1980s and 190s this shift from EO to DM appears to have gained

momentum the UK and US, therefore, the business case seems to

have crossed the traditional EO policies with diversity

management because at this time many organizations have

started to initiate Diversity policies in practice, rather

than EO policies (Kandola and Fullerton, 1998). According to

Kirton, (2010) this shift has accrued due to the changing

national and multinational rivalry and a fierce competition

facing many UK organizations which are seeking new competitive

advantages and this is perceived to be valuing a diverse

workforce.

Diversity management arose originally from the USA where it

all started a few decades ago which an attempt to meet the

legal requirements was known as, Equal Employment Opportunity

and Affirmative Action (EEO/AA). Therefore, diversity is often

used interchangeably with these two regulations. Early

literature on diversity seems to have a typical prescriptive

character which sees diversity as a tool to provide techniques

and to facilitate organizations’ ability to manage multi-

culturally. Thomas (2004) refers to diversity management as

"the systematic and planned commitment on the part of

organizations to recruit and retain employees from diverse

demographic backgrounds". The literature on early diversity

management in the USA seems to have rapidly recognised the

notion of a diverse workforce and the related proven and

assumed benefits and advancements in US markets in early

1990s. Similarly, the literature correspondingly claims that

by replacing the homogeneous skills base to a diverse skill

base and workforce involving a pool of talented employees

positively affects a company’s bottom line. As mentioned

above, for many companies this is because of global

recruiting, where companies have access to a pool of

exceptional candidates and they tend to choose the best talent

among them (Hubbard, 2004 and Morrison, 1996). In addition,

Morrison (1996) argues that those companies which have

effective diversity programs in practice appear to reduce

various types of personnel costs, for example, it is often

noted that minority workers in organizations which have such

diversity initiatives are likely to be satisfied where they

are and do not move to other firms, this as a result reduces

the turnover for the organization. However, many authors in

this field argues that diversity can be counterproductive by

introducing conflicts and other issues in the organization’s

efficacy and profitability and in addition to dividing the

nation (Jayne and Dipboye, 2004).

Similarly, the critics of the diversity management model

appears to be sceptical about the extent to which the

perceived benefits might be real (Rothman, 2003; Skerry, 2002;

Kirton, 2010). Many commentators sees “diversity as ‘process

loss’ argue that diversity incurs significant potential costs,

for instance, points out that racial and ethnic diversity is

linked with conflicts, especially emotional conflicts among

co-workers” (Nevitte, 2003; Jehn, Northcraft, and Neale, 1999;

Pelled, 1996; Xing, 1999 cited in Herring, 2009;p. 208).

Furthermore, Tsui (1992), claims that diversity impact on

group cohesiveness and this will also influence on the

employee’s absenteeism. There are also claims that diversity

is associated with lower quality which can occur due to high

positions being filled with unqualified or minority workers

(Williams and O’Reilly, 1998). Therefore, critics argue that

diversity has a dual character in the business case. In

contrast, the other notion suggests that group conflicts which

diversity introduces in the organization results in better

outcome and better performances. Diversity encourages

contestation of different groups, ideas, more creative and

superior solutions to problems, this all lead to competitive

advancement. Therefore, homogeneity may offer group cohesion

but less creativity, less innovation and less adaptability

(ibid).

In terms of historical development of the equal opportunity

legislation, the United Kingdom appears to be on the top of

the list for being most progressive within the European Union.

It is because UK seems to be concern about the workplace

discrimination and the fair treatment of the minority groups.

In the UK the current anti-discrimination regulation includes

a separate piece of legislation related to race and gender.

The Race Relations Act (RRA) was first implemented in 1976 and

then amended in 2000. This amended RRA legislation is to

tackle race discrimination and statutory duties for the

authorities to encourage racial equality in UK. Within UK,

London is one of the examples of a highly diverse city and it

remains one of the main centres of the global finance system

and it contributes almost 20% of the United Kingdom’s national

GVA (Gordon et al, 2007).

Key words: Diversity, Gender, Ethic, corporate, social,

discrimination, responsibility, Opportunity.

Personal Interest: As I come from a minority background in this country,

diversity and its organizational relations attracted me. I

wanted to know whether minorities are preferred or are being

considered for jobs in UK. Or whether do governments and

corporation realise the potentials benefits and experiences

minorities group can bring in to organizations.

Literature review:The birth-place of diversity management or managing diversity

arose in the USA a few decades ago because of the increasing

demographic complexity of the then labour markets. The early

notion of diversity in USA was an attempt to meet federally

mandated Equal Employment Opportunity and Affirmative Action

(EEO/AA); therefore, diversity is often used interchangeably

with these two regulations. Early literature on diversity

seems to have a typical prescriptive character which sees

diversity as a tool to provide techniques and to facilitate

organizations’ ability to manage multi-culturally. Thomas

(2004) refers to diversity management as "the systematic and

planned commitment on the part of organizations to recruit and

retain employees from diverse demographic backgrounds".

However, concepts of diversity in the workplace have taken a

shift from the Equal Opportunity approach with its emphasis on

following the rules and regulations of government to an

approach that embrace people from every ethnic group. Some

commentators argue that it has become a global race to employ

the best talent from a pool of candidates around the world

(Herring, 2009; Lee and Nathan, 2010). It seems that diversity

initiatives began as an effort to fulfil governmental and

legal obligations in the USA, and have evolved into a

strategic priority which aims to gain organizations more

competitive advantage in the marketplace.

The literature on early diversity management in the USA seems

to have rapidly recognised the notion of a diverse workforce

and the related proven and assumed benefits and advancements

in US markets in early 1990s. Therefore, Thomas (2004)

suggested that the chief executive officers (CEOs) of many

companies in the United States seem to be increasingly

concerned with the challenge of constructing and maintaining a

multicultural and diverse organization. Similarly, in the US

top executives including, IBM’s Lou Gerstner and his successor

Sam Palmisano seem to have invested a considerable amount of

time and energy and company resources on accomplishing

diversity. It is argued that these kinds of initiative

provoked a culture of attaining a diverse workforce in USA, by

the end of the 1990s, by which time; it appears that three out

of four Fortune 500 companies had already taken diversity

programs on board (Caudron, 1998). By this time in the USA the

EEO/AA programs which were required by the law to ensure that

organizations’ HR polices do not discriminate against minority

groups were in the company’s policy agendas (Richard, 2000).

Similarly, by this time in the UK legislations were being

passed on the issue of gender, race and ethnic discriminations

at workplaces.

Some of the literature on diversity management argues that in

today's national and multinational corporations, a diverse

workforce seems to be a priority of executives. In addition,

many authors claim that the executives and senior management

understand that without a diverse and inclusive workforce

their companies have no grounds to be successful on the global

platform. It is argued by some that a diverse workforce is

essential to drive innovation, foster creativity, and guide

business strategies (Jayne and Dipboye, 2004; Richard, 2000).

Therefore, the assumption is that multiple voices lead to new

ideas, new services, and new products and all this encourages

‘out of the box’ thinking. Furthermore, organizations in

today’s information based markets believe that a diverse

workforce can gain competitive advancement from their rivals

and also that diversity facilitates the capturing of new

clients around the world. According to the US Corporate

Leadership Council, (2003) every year American organizations

spend $8 billion on diversity programs and these organizations

devote resources to a variety of other diversity related

initiatives, training, dedicated diversity management staff

and workplace programs. Those organizations competing on the

global stage are presented with a series of business related

and other challenges in addition to companies’ routine

concerns such as managing growth, building a sound

infrastructure, and keeping an eye on the bottom line.

Therefore, expanding companies’ operations overseas comes with

special challenges which include laws and regulations which

vary from region to region, and there will be language and

cultural barriers that can create unanticipated issues and

challenges. Due to these concerns many commentators in this

field suggest that many organizations have found that the best

way to ensure their continued success on a global scale is by

having a diversity program in practice and a diverse and

inclusive workforce (Caudron, 1998). Nevertheless, the critics

of diversity management argue that, (Rothman, Lipset, and

Nevitte, 2003a, 2003b; Skerry, 2002; and Xing, 1999) it is not

been proven and there is not enough evidence which suggest

that these claims are real or whether diversity is by any mean

profitable to organization. They furthermore, argues that

‘diversity as process loss’ by which they mean that racial and

ethnic diversity in an organization is linked to conflicts,

especially emotional conflicts and they also seems to oppose

the claim that multiple viewpoints create innovation and

increase productivity, by suggesting that diversity reduces

group cohesiveness. Moreover, Williams and O’Reilly (1998),

suggests that greater diversity leads organizations to lower

quality because when certain positions are filled with

unqualified workers with assumption that when seniority is

diverse it leads organizations to profitability and

competitive advance and access to minority customers.

More than one source suggests that diversity management

programs are long term initiatives and strategically placed to

not just only recruit but to vigorously strive, develop,

promote and take advantage of various abilities, perspectives

and skills of minority employees which involve consideration

of fundamental organizational changes (Cox, 2001; Hubbard,

2004). It is suggested that emphasis on diversity appears to

progress organizational performance. Therefore, various

researchers have suggested that groups made up of diverse

employees do a better and more successful job than a

homogeneous team. It is believed that diverse working teams

can be more innovative, flexible, and productive in analysing

a problem and a diverse group seems to be more appealing to

consumers (Kochan et al, 2003). Similarly, the literature

suggests that an organization must attain a workforce which is

highly qualified and also highly diverse, nonetheless, it has

also been noted that whenever an organization has failed to

manage diversity it has seen a reduction in performance. The

critics seem to be sceptical whether diversity is actually

beneficial for a short term or a long term business strategy

which can gain organization competitive advantage (Kirton,

2010; Noon, 2007). Kirton, (2010) argue that skills and labour

shortages are not universal and they vary over time and space,

as a country’s economic situation changes its labour markets

adopts new changes. For example if economy is booming and

young employees are in shortage, women and older workers might

become the only source of employees. However, many authors

agree that certain types of diversity policies and practice

can be valuable to organizations but it depends on the product

base and customers’ demands, i.e. depending on industry and

business there will always benefits to be gained by employing

young, older, gay or lesbian workers (ibid). However, these

are short term benefits and for particular time and space.

The literature correspondingly claims that by increasing the

skills base to a diverse skill base and workforce involving a

pool of talented employees positively affects a company’s

bottom line. As mentioned above, for many companies this is

because of global recruiting, where companies have access to a

pool of exceptional candidates and they tend to choose the

best talent among them (Hubbard, 2004 and Morrison, 1996). In

addition, Morrison (1996) argues that those companies which

have effective diversity programs in practice appear to reduce

various types of personnel costs, for example, it is often

noted that minority workers in organizations which have such

diversity initiatives are likely to be satisfied where they

are and do not move to other firms, this as a result reduces

the turnover for the organization. Similarly, according to

Davis “hiring minority executives is an effective way to get a

leg up on the competition. Because of changing demographics

and fierce competition in the job market, a growing number of

companies are starting to regard minority executives as an

underused and under-tapped resource” (2000, p. 50). In

addition to this Morrison also observes that “additional

benefits accrue when a firm’s leadership is diverse” (1996,

p.58). The literature claims that this can be achieved by

effective methods of leadership development, which is then

applied to larger groups which in turn enhances companies’

responsiveness, profitability and productivity in these fierce

competitive markets.

It is also argued that multinational corporations can increase

market share by attaining a workforce similar to their target

customers. This is yet again another indication that by

emerging a homogeneous diverse workforce that mirrors its

consumer market benefits a firm’s customer base and appeal.

For example, an organization’s minority employees might be

able to communicate better with minority customers and also

understand their needs and this is therefore seen as

increasing the quality of customer service and relations.

Similarly, Cleaver argues that “Some companies that specialize

in service-oriented industries, like mortgage lending, argue

that minority borrowers are more likely to pursue a loan from

a firm if they can work with a lender of their own ethnicity

(Cleaver, 2003 cited in Jefferson et al, 2008, p. 3). In

industries like health care a more diverse and inclusive

workforce can increase the possibility that minorities would

also receive high quality medical consideration (Cohen,

Gabriel, and Terrell, 2002). Hence it seems that depending on

the industry and employment, employing minorities and

different ethnicities does enhances the quality of service and

potential benefits for the business in the case of mortgage

lenders and healthcare.

The literature suggests that diversity must be accepted and

unified into the firm’s social environment and business

fabric. It is common know-how in the diversity literature that

an inclusive diverse work environment encourages personal

enlargement and provides higher levels of job satisfaction and

enhances the job performance of the two parties, the

minorities and nonminority personnel (Jefferson, 2008).

Similarly, Cox (2001) proposes that worldwide multinational

corporations seem to be the most flexible firms in terms of

their continuous initiatives of integrating minorities into

the company’s structure and encouraging an obligation within

employees for individual differences. This might be due to the

demand which multinational corporations face whenever they

expand their operation into other countries and they have to

employ workers from that country. However, many authors also

suggest that if an organization employs people from different

backgrounds, age and sex but failed to manage diversity it

will back fire and in return reduce turnover and create

problems within workplace (Herring, 2009). The research which

was conducted by Brock and Sanchez (1996) also supports the

above arguments and claims that in an organization where real

and perceived discrimination does not exist and where there is

a positive attitude in acceptance of differences, then these

types of organizations tend to consider diversity in a

holistic sense which emboldens unity. In the current economic

situation, firms in industrialized countries seem to have

understood that demographically diverse workforces are

becoming increasingly inevitable. This has been due to the

changing gender relations and the aging population in western

societies and also the increased amount of economic migrant

workers moving around the globe, hence organizations face

increased diversity of the workforce (Kelly, 2006). However,

in regards to multinational corporations diversity initiatives

one can argue that they diversity policies and actions can be

merely to fulfil the host country’s regulations and more

importantly to valuing and meeting the stakeholder’s

expectations in relations to diversity.

According to a Forbes (2011) report, the business case for

diversity and inclusion is inherently linked to a company’s

innovation strategy. The report claims that multiple and

diverse voices carry a wide range of experiences and that

these experiences can help generate new concepts about

productivity and new practices. Among survey respondents

“(companies with more than $10 billion in annual revenues)”,

56% strongly agreed that diversity helps drive innovation.

“Because of our diverse workforce, we’ve experienced a boost

in productivity. When you can move people to contribute to

their fullest, it has a tremendous impact. We have a vast

amount of diversity [within the company] that comes into work

every day to build technology that plays out around the world.

You can’t be successful on a global stage without it,” Hudnell

added (Forbes, 2011). Companies in the fight for the best

talent for diversity and inclusion are designing specific

policies such as recruiting and retention tools which help

firms to pile up pools of candidates which companies can

recruit and at the same time helping to build an employment

brand which would be seen as fully inclusive. The Forbes

report suggests that 65% per cent of companies which they

surveyed have specific diverse employee recruitment policies

and 53% of respondents have diversity focused development and

44% per cent of them have specific diversity retention

programs in practice. Thus it appears that in today’s business

environment organizations are taking a variety of different

manoeuvres to engage the kinds of diverse people they want to

bring in to their organizations. For example firms like AT&T

and Mattel have registered their employee teams to act as

company ambassadors. These ambassadors groups expand and reach

far and wide in search of talent by attending outside

organization job fairs, conferences and also community events.

“The more they reach out to the public, the more it will help

fill our talent pipeline,” (said Mattel’s Wilson, cited in

Forbes,). Companies also build their relations with top

universities to reach out for talent and have connections with

lecturers and professors to pin point the talented students

and take them on board. Many commentators in this field

believe that there are still barriers to overcome but there

has been significant progress in building and retaining a

diverse workforce and diversity friendly work environments and

other related issues (Hansen, 2003; Konrad, 2003). However, in

the Forbes report 75% per cent of respondents felt that there

were no barriers existing at their firm, while, some believed

that much attention and improvement are needed in relation to

disability, age and sexual orientation programs.

Despite the above mentioned impacts that diversity can have on

organizations; diversity as in the ‘value in diversity

perspective’ appears to be good for business because diversity

offers a direct return on the firm’s investment in the shape

of promising higher corporate profits and earnings. However,

diversity can be counterproductive by introducing conflicts

and other issues in the organization’s efficacy and

profitability and in addition to dividing the nation (Jayne

and Dipboye, 2004). In contrast, the other notion suggests

that group conflicts which diversity introduces in the

organization results in better outcome and better

performances. Diversity encourages contestation of different

groups, ideas, more creative and superior solutions to

problems, this all lead to competitive advancement. Therefore,

homogeneity may offer group cohesion but less creativity, less

innovation and less adaptability (Hickman, 2002). Within

United Kingdom the cities are filled with UK migrants and a

very high number of minority populations reside and there are

cities where you can literally see and feel diverse. For

instance London in UK is a living global city which inhabits

300 different languages and it contains 13% of UK population

alone. According to Lee and Nathan, (2010) London contributes

20% of the national GVA; they claim that this economic

strength is because of being diverse. Similarly, Leadbeater,

(2008; cited in Nathan, 2010; p.56) suggests that “London’s

diversity is seen as driving forward ideas generation and

emergence of new product and services”. However, London might

be a perfect example of being diverse, this does not been that

London’s organizations are fully diverse and equal opportunity

is effective.

The United Kingdom’s actions on diversity management

originally existed as an auxiliary for equal of opportunity.

Therefore, diversity management in the UK is arguably shaped

on the inheritance of the equal opportunity approach (Tatli et

al, 2006). The literature claims that the British and EU’s

equal opportunities policies have gone through three major

periods; equal treatment (1970s); positive action (1980s); and

gender mainstreaming (post-1990s). As a result of legal and

economic compliance the employers had to adopt diversity

management policies and implement diversity programmes (Tatli

et al., 2006a). At the early stages in the EU the commitment

was focused on equal pay for equal work. Hence, in the 1970s,

the European Union dispensed various equal opportunities and

equal treatment directives on pay, better working conditions,

training and development, and fair recruitment, social

security and promotion. Moreover, the 1980s in the EU equal

opportunity policies appear to have gained new grounds and

adaptation of a more proactive policy which extended the scope

beyond legalistic obligations and encouraged organizations to

be fair and to pay equality regardless of employees sex and

gender differences but even still today we see employees being

paid differently because of their age, sex and nationality

(young, 2000). In addition, in the EU in the 1990s the notions

of gender mainstreaming gained serious attention with the

rising concerns about the feminization of poverty in the

Europe. This is period in the EU when the clauses in the legal

framework from the Article 13 of the Treaty of Amsterdam and

council directives were amended and widened to cover numerous

forms of discrimination such as: sex, racial or ethnic origin,

religion, beliefs, disability, age and sexual orientation

(Hoskyns, 1996). It seems that the rise of these elements

which were covered by the EU’s equal opportunity framework can

be inferred as a signal of a move forward to a diversity

management approach at European level. However, these

legislations may vary from nation to nation in Europe but they

had clear influence on the national equality legislations of

EU member states. For example, in the UK recently the

legislation on sexual orientation, religion and belief and age

have been implemented in order to comply with the European

Employment Directive of 2000 (That, 2010).

In terms of historical development of the equal opportunity

legislation, the United Kingdom appears to be on the top of

the list for being most progressive within the European Union.

In the UK the current anti-discrimination regulation includes

a separate piece of legislation related to race and gender.

The Race Relations Act (RRA) was first implemented in 1976 and

then amended in 2000. This amended RRA legislation is to

tackle race discrimination and statutory duties for the

authorities to encourage racial equality in UK. Similarly,

than the Sex Discrimination Act of 1975 was amended and also

disability Discrimination Act 1995 was too amended in 2005. In

the UK in order to ensure that these regulations were

implemented, statutory bodies were recognized in all these

areas. However, there is evidence of discrimination on bases

of race, gender, disability, age and religion in the UK and

also at the EU level, despite the existing legislative

attempts of the last decades. Many scholars believe that in

the UK and EU employment patterns seem to be gendered and

women still face significant rejections and disadvantages in

the current labour markets and also there exists occupational

segregation and there is a huge gender pay gap among genders.

Liff and Wajcman (1996) appraised the equal opportunity

measures because of its limitations of positive action and

workplace practices in terms of legalistic attitudes and the

notion of social structures that to be blamed because it

reproduces and sustain disadvantages, discrimination and

inequality.

It seems that different organizations see and use diversity in

different ways and for a number of reasons. Companies appear

to take advantages of diversity in the labour market (Greene

and Kirton, 2009). However, these advantages seems to have a

dual character in the market, one that appears as taking

advantages of diverse skills and abilities and secondly, might

be for the reason of cheap labour or paying less to the

minority groups as compared to their other counter parts. It

seems that in UK many organisations recognise that potential

benefits of diversity for maximizing the employee’s potentials

and contributions towards the organisation. Therefore, many

organizations in UK have policies in place for recruiting and

retaining talented people across. One proposed advantage of

diversity appears in number of writings is that diversity

firms can enhance creativity and innovation via a diverse

workforce and this statement can be seen in many multinational

corporation’s websites. However, firms are also recruiting and

retaining diverse workforce due the legal and legislative

policies of the countries which they are based, for example UK

has clear equal opportunity and discrimination policies in

place to force firms to employ people across nation. In

today’s markets businesses also appears to employ people

(ethnic) for enhancing a good reputation in the society

because they want to be seen as ethnical due to their ethnic

business practices to diversity. How companies make sure that

diversity is fully incorporated in their workforce is through

initial involvement of the line managers and the recruitment

team. Line managers appears to be involved in early stages of

employment is to encourage and support the employees from the

beginning so that they feel empowered and this help them to

drive their business strategy and make sure that other

employees buy in to this corporate diversity agenda.

Analysis of the FTSE100 companies website diversity statements:

Corporate websites usually provides various useful and insight

information regarding the firm, their work and successes.

Hence, I will be looking into specifically the corporate

diversity agenda on the website and to illustrate whether the

claims made by the writers in my literature review are

recognised and whether the corporate world is aware of the

advantages of having a diverse and inclusive workforce.

Corporate websites provide a useful means of communicating

corporate values and policies, and recently many large

companies have started to include ‘‘diversity statements’’ on

their websites. These diversity statements are similar to

their mission statement or business strategies, and these

statements are used as window-dressing to highlight the

employer’s good corporate social citizenship and ethical

management practices (Winter et al., 2003 cited in Singh,

2006). They may be viewed as artefacts that reveal information

about the corporate culture and play a dynamic role in the

realisation of values and beliefs of the employers. Diversity

statements are important because of their role in the social

construction of diversity, through their discourses helping to

shape how differences are to be considered, valued and managed

in companies and the business world (ibid).

Aberdeen Asset Management PLC:Diversity policy: Aberdeen Asset management Plc is listed in

the FTSE100 companies who have operations in many countries

including UK and the US. On AAM website it does state that

diversity is in their core of business corporate social

responsibility. The statement on the website under diversity

and equality section says: “We aim to provide an environment

in which applicants and employees are treated equally.

Aberdeen aims to provide a work environment in which there is

respect for personal dignity”. And also claims that it strive

to achieve a gender balance for their apprenticeship, intern

and graduate programmes, recognising that to achieve a

sustainable pipeline, focus must be placed on each level of

the business. These programs are run and closely monitored by

the line managers to make sure thy split the number of young

people who apply and that women’s representation is taken

seriously. However, there seems to be no clear information on

their workforce diversity in terms of race, religion, culture

and ethnicity.

AAM claims on the website that their main corporate diversity

agenda is to take even number of women on board. Therefore,

AAM runs coaching to women during their maternity leave. The

aim is to make the process for mothers returning to the

business from maternity leave a smooth one and provide the

support they need to help them progress in their career.

Globally, the number of board seats held by women varies

significantly, from 36% in Norway which however is to fulfil

the Norwegian government regulation and to 5% in Italy and 1%

in Japan. Currently, Aberdeen’s Board consists of fourteen

directors, of whom three (21%) are female.

The company claims on its website that a number of measures

are being employed to tackle this issue with some countries

adopting quotas while others try to use voluntary measures to

stimulate change. However, the company does not mention any

form of benefits or advantages which can be obtained by having

a diverse and inclusive workforce. The company is also an

active member of a number of associations including Women on

Boards (UK), the Philadelphia Chamber of Commerce and the

Women in Investing Network (US). It appears that the company’s

diversity and inclusion statement on website is merely a

showcase and to comply with the government regulations.

Admiral Group Plc: Diversity statement: “Admiral Group respects and values the

individuality and diversity of every employee. The Group’s

Equality, Diversity and Dignity at Work Policy ensure that

every employee is treated equally and fairly and that all

employees are aware of their obligations”.

To drive further improvement in the representation of women in

management and the workforce as a whole, each of our

businesses has drafted individual action plans. These plans

include clear internal stretch targets to be achieved by

December 2012 and December 2014 (for the percentage

representation of women in the workforce as a whole, and women

in management), as well as a description of the measures that

will be taken.

The company’s overall workforce profile consists of 3454 male

and 3531 female. From these numbers it looks Admiral Group

have taken gender diversity seriously and implemented policies

and practices to achieve a high number of women on board. The

current board of directors consists of 8 male and only 2

female representations. And other senior managers, women’s are

at 13 and men 2. On the board the level company also does

recognises the potentials benefits of diversity and inclusion

of women. The HR initiatives which company has taken on board

to promote women in mining include flexible work hours, child-

care facilities and development, training and mentorship

programs focused on women. The company does appears to take

advantage of diversity in the labor market and it does

recognize the potential benefits of diversity in creating

innovation and valuing employee potentials of contribution

into the company’s goals and aims.

Barclays Plc:Diversity statement: “Talented people are the foundation of

our success, whatever their style, personality, age, race,

religion, gender, sexual orientation, or disability”.

Barclays appears to be on the top of the list to recognise and

embrace diversity in all forms and shape in UK. Barclays named

as a top employer for lesbian, gay and bisexual people in the

UK. Barclays is the only financial services organisation to be

among the top 25 employers in the Stonewall Workplace Equality

Index every year since it launched in 2005. In 2002 Barclays

achieves a gold standard for race equality in Race for

Opportunity benchmarking, and for gender equality in

Opportunity Now benchmarking. Barclays’ diversity and

Inclusion strategy is sponsored by the Barclays Executive

Diversity Group.

Barclays also claims that the company want to see more women

in the top board and representing women represented in senior

roles. Barclays have set targets to meet its diversity and

inclusion initiatives by committing to achieving

recommendations for Board-level female representation of at

least 20% by the end of 2013, increasing to more than 25% by

the end of 2015. However, merit is their only basis for

recruitment but they actively consider gender diversity when

attracting talent, from their future leader programmes to

their most senior hires, and ensure that recruitment suppliers

support their aims and aspirations to attract diverse

candidates.

The potential benefits and advantages Barclays claim to gain

from a diverse workforce includes, maximizing its employees

potentials and their active contribution to achieve the

organizational goals through creative ideas and innovative

strategies. Barclays also seems to be recognising the

importance of being an ethnically responsive business through

its diverse recruitment and retention policies.

BHP Billiton Plc:Diversity statement: “Focusing on diversity and inclusion We

strive to achieve diversity, in all its forms, at all levels

of the organisation. We believe a diverse workforce is

necessary to deliver our strategy, which is predicated on

diversification by commodity, geography and market”. BHP

Billiton Group has established three measurable diversity

objectives that they claim in their website that sought to

enhance their diversity profile. Firstly, BHP has added

diversity and inclusion in to its company’s behaviours that

demonstrate their Charter values which every employee is

expected to demonstrate and the Charter also include specific

behaviours that support diversity and create a collaborative

and inclusive work environment.

Secondly, BHP implemented other HR targeted initiatives to

attract graduates focused on specific disciplines, to increase

the proportion of female graduates hired year-on-year.

However, the overall workforce portfolio appears less

appealing as compared to website statements on gender

diversity; the gender diversity comprises 17 per cent female

and 83 per cent males.

In Fy2013, we established three measurable diversity

objectives that sought to enhance our diversity profile.

Achievements against these objectives are set out below.

Firstly, we embedded diversity and inclusion in the behaviours

that demonstrate Our Charter values through Our Charter values

in Action. Our Charter values in Action outline the behaviours

we expect all employees to demonstrate and include specific

behaviours that support diversity and create a collaborative

and inclusive work environment. Our Charter value in Action is

an integral element to our performance management process.

employees are assessed against Our Charter values in Action

and feedback and coaching are provided. Secondly, we

implemented targeted initiatives to attract graduates focused

on specific disciplines, to increase the proportion of female

graduates hired year-on-year. Thirdly, its Businesses, Group

Functions and marketing were required to develop and implement

a multi-year diversity plans. These actions were based on the

proposed advantages and benefits from the diverse workforce in

the labour market and further enhancing creativity and

innovation and ultimately to the success of the goals and

objective of BHP.

British American Tobacco PLC:

Diversity and inclusion statement: “Diversity helps us to

understand our consumers, customers and stakeholders and to

meet their needs. It also provides different ways of looking

at challenges, encouraging creativity and innovation”. The

managerial level proportion of workforce consists of women at

32%, however, there is no information provided in the website

for the overall workforce profile. On the other hand 27%

female representation on the main board has even exceeded the

UK government recommendations. British American Tobacco group

although does recognise the importance of diversity and

inclusion and claims that it helps them achieve their business

goals and it is incorporated into the business strategy.

BSKYB:Diversity and inclusion statement: “It’s our people that make

Sky Britain and Ireland’s leading entertainment and

Communication Company. That’s why we work hard to be an

inclusive employer, so everyone at Sky can be their best”.

BSKYB claims in its website that it has seen increase black

and minority representation in the company’s workforce and as

well as the total number of women in our workforce has

increased from 7,208 to 7,633 over the past year. The company

claims that it benefits from the diverse workforce in the

labour market and it helps maximizing employee participation

and contribution to new and innovative ideas which has seen

increase in customer base. However, there is no other form of

information on diversity on website.

Burberry Group Plc:Diversity statement: “Burberry maintained its commitment to

diversity and equal opportunities in recruitment. The

diversity within the Burberry community underpins its energy,

vibrancy and connectedness”. Burberry’s overall proportion of

workforce seem to be very diverse as it has 10,000 associates

from over 100 countries, are now employed across all

continents, with an age span from 16 to 77 and a global

management team that is 37% female. Burberry seems to

recognise the potential benefits of a diverse workforce and

taken a few initiatives to retain a diverse workforce.

However, being a clothing and fashion retailor it employees

only 37% female.

EasyJet PLC:Diversity statement: “Capitalising on what is unique about

individuals and drawing on their different perspectives and

experiences adds value to the way we do business”. EasyJet Plc

recognises that a diverse workforce will provide the business

with an insight into different markets and help anticipate and

provide what their customers want. EasyJet workforce appears

to be very diverse, the overall proportion of women throughout

the Group reached 45% female and 55 male and the management

team consists of 26 female and 74 male. From an early stage in

the recruitment the management keeps a close eye to make sure

that other employees buy-in to this strategy and encourages

the empowerment of their employees. As well as the firm as

incorporated this diversity strategy into it core business

strategy so that other employees see this as an acceptable

action. EasyJet being a service provider it take advantage of

its diverse workforce to attract new customers and customer’s

satisfaction through diversity and inclusion. This also gives

the company the competitive advantage over the rivals and

enhances its reputation via ethnical business practices.

HSBC Holdings PLC:DIVERSITY AND INCLUSION: “We believe that diversity brings

only benefits for our customers, our business and our people.

The more different perspectives we have, the better equipped

we’ll be to meet the demands of our hugely diverse global

customer base – whether they are starting a business for the

first time, exporting to new markets, planning for their

retirement, or looking for financial products compliant with

their religious beliefs”. HSBC currently has employed managers

from 50 different nationalities around its corporation. HSBC

does recognise the potential benefits of a diverse workforce

and has taken substantial steps to retain talent across the

globe. However, it is not clear whether these initiatives are

taken for business benefits or the need to fulfil the host

countries regulations, hence it does recognise the importance

of employing people from different culture and to an extent it

has. The proposed benefits HSBC can achieve from a diverse

workforce which are claim in website are; creating business

opportunities via diversity and enhancing its reputation via

ethnical business in relation to diversity.

Intertek Group PLC:Diversity Policy: "Women on Boards", recognises the benefits

of having a diverse Board, and is committed to achieving a

Board which will include and make the best use of differences

in culture, gender, skills, background, regional and industry

experience and other qualities”. There is no further

information regarding diversity in company website.

InterContinental Hotels Group PLC:

Diversity and equality: “We are proud of our rich cultural

diversity across the globe and within our local hotel

communities. It allows us to strengthen our understanding of

and respond to the needs of our guests, and is reflected in

our Winning Ways”. The overall proportion of workforce

portfolio consists of 59% Male and 41% Female. Other HR

practices have been implemented by the Group which offers

development programmes for women and succession planning for

high potential candidates. Moreover, there overall managerial

diversity includes, male being 49% and Female Managers 36%.

Similarly, the Non-manager female representation in the

organization is 64% and male is 51%. It appears that ICH Group

is determined and commented to diversity and foresees it

benefits and advantages in the market.

Standard Chartered PLC:Diversity and inclusion: “We believe that diversity, including

gender diversity, is a very important factor impacting the

Group’s performance and wider organisational effectiveness”.

Standard Chartered group’s 50% workforce consists of female

and overall employees represent 127 countries around the globe

and it ensures an active engagement of line managers from an

early stage in the recruitment process to ensure other

employees buy-in. Currently, the board consists of a diverse

mix of ethnicity, gender and experience including 3 women and

7 different nationalities. There are 12 directors who have

lived or worked across Asia, Africa and/or the Middle East.

And senior management consists of only one woman and 7 male.

The proposed benefit for the group appears to be taking

advantage in the labour market and innovation and creativity

through diversity and inclusion and also a good reputation in

business for ethnical business practices.

Wm Morrison Supermarkets PLC:Equality and diversity policy: “We pride ourselves in being

different. This is underpinned by our desire to promote

equality and diversity. We recruit, train and work with people

from all sections of society and value the different skills,

ideas and experiences they can bring to our business”.

Morrison group is committed to increasing the female

representation on the Company’s Senior Management Group from

13% to 30% by 2014. The Group has made progress on this

commitment in 2012 and now have 22% representation at this

level (an increase of 2% on last year) with women represented

at senior management level across all divisions. The Group

believes that different skills and experiences can bring

business advantages to the company but what benefit they can

achieve from diversity are not mentioned in the website.

Smith & Nephew PLC:

Diversity and inclusion: The Group's employment policies are

based on equality of opportunity regardless of colour, creed,

race, national origin, sex, age, marital status, sexual

orientation, mental or physical disability unrelated to the

ability of the person to perform the essential functions of

the job. There is no further information regarding diversity

and inclusion and there potential benefits.

Lloyds Banking Group PLC:Diversity & Inclusion: “At Lloyds Banking Group diversity and

inclusion is central to our business success. Our 30 million

customers are very diverse and we need to ensure that we

understand and can meet their needs if we are to be

successful. Reflecting the diversity of the UK in our own

workforce helps us to achieve that goal”. Currently 3 of the

12 Board members are women and Lloyds Group is a member of 30%

Club in UK, is an organization which encourages women on

board.

Overview of the website diversity and inclusion statements:

It appears that most of the companies’ websites does have a

diversity policy/statement in their websites. As mentioned

above many companies put on these statements for ethnical and

social purposes to present them as socially responsible.

However, there are many organizations in the FTSE100 which do

recognises the advantages and benefits for business and taken

various initiatives to achieve workforce diversity. For

example, Aberdeen Asset Management PLC does recognise the

advantages and it is member of organization called Women on

Board (UK). However, AAM is only focused on increasing the

number of women in their workplace and does not mention any

information on the race, ethnicity and cultural diversity.

Similarly, Admiral Group has a 50% female workforce; however,

it has 2 female directors and 8 male. This tells us that

corporate diversity policy/statement does always means that it

has effective and in action. On the other hand, Barclays has

been named as a top employer for lesbian, gay and bisexual

people in the UK. Barclays is the only financial services

organisation to be among the top 25 employers in the Stonewall

Workplace Equality Index every year since it launched in 2005.

In 2002 Barclays achieves a gold standard for race equality in

Race for Opportunity benchmarking, and for gender equality in

Opportunity Now benchmarking. Barclays understands potential

benefits of having a diverse and inclusive workforce and it

has proven that diversity does come with business benefits and

advantages.

Conclusion: Diversity initiatives begin as to tackle the gender

discrimination the USA has now spread around the globe as a

competitive advantage and potentials for business benefits.

Diversity issues in Europe have gained much publicity over the

last two years, with increased pressure from governments and

the European Commission. However, in terms of promotion of the

discourse of diversity for competitive advantage and for

potential business related benefits, the UK appears to be on

the top of the list than rest of the Europe. Importantly, the

UK companies are demonstrating far more than just lip service

to diversity, evidenced by the relatively high number of

female directors on their main boards (Liff, 1999; Lorbiecki

and Jack, 2000).

My above research has been on what companies say they believe

about diversity in their corporate diversity agenda. The

potential reason which have crossed my eyes seems to be

enhancing their company’ competence, cultural learning, talent

management and better recruitment, as well as increase

creativity and innovation. In the literature research it

appears that gender and ethnicity are said to bring

competitive advantage through mirroring and understanding the

customer base. However, there are also many companies which do

not have diversity policies in practice and seems to be doing

very well and also many companies and critics of diversity

appears to be sceptical about the potential benefits and the

way diversity has been published as a competitive advantages

to businesses. Many authors have expressed concerned about

having a diverse workforce and its related issue and problems

which incur.

My analysis on the websites of a number of FTSE100 Company

tells me that diversity does matter and it does have positive

and negative impacts on business. However, the websites which

I have looked into does recognises the importance of diversity

and most of the companies appear to have incorporated the

diversity and inclusion statement into the company’s main

corporate social agenda and seen as a way forward and a

competitive advantage to the company’s aims and objectives.

However, some multinational corporations does not have any

kind of diversity related statements on their websites, i.e,

Rolls-Royce Holdings PLC does not have any diversity and

inclusion policy on its website. Hence it is a very profitable

company which produces luxury cars. Similarly, GlaxoSmithKline

PLC does not recognise the importance of diversity on the

website. Another multinational corporation does not have any

diversity policy in place is Coca-Cola HBC, it has production

and operations around the globe, hence does not consider

diversity and inclusion a business advantage or competitive

advantage. However, those companies which do have corporate

diversity statement online appear to be focused on the women

(Gender) and diversity does not only means having a workforce

consists of same culture but only difference male and female.

The company’s online statements which I have analysed some of

them appears to be concern on the gender aspect of diversity.

On these bases it is hard to come to a conclusion that whether

these companies do believe that they can gain business

advantages in relation to diversity.

Methodology: The research methods I chose for my dissertation were

conducting a literature review of the diversity management in

the USA and then taking that to UK based firms. The resources

were collected from the University library archives; this was

the initial phase of my research; because I wanted to look

into the history of diversity and it implications on business

and perceived advantages in the business world. Looking into

US markets in relation to diversity gives in-depth information

in relations to firm’s behaviour towards the diversity. The

second phase of my research consists of conducting website

corporate diversity statements and to illustrate whether the

firms do believe that having a diverse workforce comes with

business benefits and advantages. The research on the websites

provide an insight into the business behaviour in relations to

diversity and its related advantages and disadvantages.

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