• Krishna Grenville-Goble, Director |

Social mobility needs to become a priority on boards

Our recent BLC Survey Uncovering social mobility on boards highlighted that social mobility is not currently prioritised in board recruitment or nomination committees.

There is a lack of data on the socio-economic background of board members, and our survey tells the same story. As many as 84% of respondents confirmed that their board doesn’t know or measure the socio-economic background of its members, and 69% stated that their nomination committees were not addressing it during succession planning - notwithstanding that the UK Corporate Governance Code sets out that board appointments should “promote diversity of gender, social and ethnic backgrounds, cognitive and personal strengths”.

Combined with a lack of confidence or comfort board members may have in sharing this information, there is an opportunity to create a more inclusive culture and avoid a feeling of ‘judgement’ based on background. This is in stark contrast to gender and ethnicity data which shows clear progress in these areas - strongly driven by the FTSE Women Leaders and Parker Reviews as well as increasing regulatory support for better diversity on boards.

Practical steps

Social mobility is a complex area and how it is measured is also evolving (see Social Mobility Commission for latest updates), however there are some practical steps nomination committees can take to begin focusing on this area, here’s our top 10:

  1. Empathise – Become familiar with the challenges those from a lower socio-economic background may face (even if you are from a lower socio-economic background yourself, some of the lived experiences young people currently face may be different to your own).
  2. Be comfortable sharing your story – your story may inspire others to feel comfortable sharing theirs.
  3. Clear commitment from the top – Commitment to improve social mobility should come from the board. It should be visible to employees through the conduct and actions of all board members, in particular the CEO.
  4. Demonstrate the business value of social mobility – As with other KPIs, diversity metrics should be a matter of business performance, and not be considered a ‘nice to have’. Demonstrate the value of improving social mobility in your organisation in recruitment and retention, better serving customers, diversity of thought, entering new markets, innovation, and engaging your investment community as part of your ESG commitments, for example.
  5. Measure social mobility as a diversity metric – Build social mobility into your IDE strategy, include an honest picture of your goals and how you will make progress towards achieving them. Doing so creates awareness, credibility and confidence.
  6. Accountability and visibility – Measure progress and hold the CEO and leadership team accountable by linking progress on all diversity metrics – including social mobility – to compensation. Ensure your strategy, progress and action plans are explicit in your annual report.
  7. Data is paramount – Collecting and understanding data about the socio-economic backgrounds of your employees is key when designing your strategy and action plan to help improve representation in this area. There isn't one perfect measure, so consider using a blend of different measures. See the Social Mobility Commission ‘State of the Nation 2022’ report for latest Social Mobility Index updates.
  8. Setting sustainable targets – Consider setting targets at all levels, including leadership and senior management, business unit heads, middle ranks, and internships and provide rationale for them. Targets should be appropriate to the number of employees in the organisation, and there should be a balance between being realistic and ambitious enough to make sustainable change.
  9. Board composition – Review the socio-economic background of the current board and senior leadership team and question whether socio-economic diversity is represented? If recruiting new board members, ensure socio-economic background is considered in addition to other diversity metrics.
  10. Redefine talent – Think carefully about the skills and experience required for the board role. For example, do all candidates need to have a traditional background? Do they need prior board experience, or could they gain experience whilst in the role? Focus on the skills, experience and attributes that could be of benefit to the board and organisation’s future strategy. People from different socio-economic backgrounds are likely to bring fresh approaches and thinking to the boardroom.

Read the full 'Uncovering social mobility in the boardroom' survey here