Workforce Report 2019

WORKFORCE REPORT 2019

5.2 Ethnicity and Executive Pay Gap Reporting Since the 2018 Workforce Report , the government has carried out a consultation with employers into ethnicity pay gap reporting. While this makes sense as a next step, in practice this could be fraught with difficulties as employers look to balance compliance and the desire for quality data with the challenge of not alienating those with an ethnic heritage. Members expressed concern that asking people to declare their ethnicity ran counter to the inclusive culture they are working to promote in their organisations because it labels people and could send the wrong message to employees. There is also concern that focussing on one particular characteristic detracts from their internal Diversity and Inclusion (D&I) agenda. When it comes to executive pay, the forthcoming requirements for organisations to publish and justify the difference between chief executive remuneration and average annual pay for employees reinforces the focus on increased transparency around executive reward. The regulations make it a statutory requirement for companies listed on the London Stock Exchange with more than 250 staff to disclose the ratio of chief executives’ remuneration to the median pay of UK employees every year; the first submissions will be for 2019, reported in 2020. Companies in scope of the legislation will also have to report how directors take staff and other stakeholder interests into account when they decide on salaries and bonuses. 5.3 Diversity and Inclusion OGUK has developed a comprehensive D&I strategy which highlights the great work being undertaken by industry. This will also help to identify any gaps that exist and enable the further development of an industry-wide culture of behaviours that embraces all aspects of diversity and inclusion at every opportunity. A key objective is for the industry to be viewed as a great place to work, one where everyone feels able to bring their whole selves to work, that has a future and is positively addressing the challenging political, environmental and societal changes and demands. This year OGUK will be building a network of D&I champions to promote this agenda and to consider any gaps at an industry level, assessing the challenge of getting more people involved in STEM at an early stage and promoting our members’ work with schools throughout the UK.

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