KPMG research reveals lack of socio-economic diversity on UK boards

New research from KPMG reveals that socio-economic background diversity on UK boards is lacking, and too few consider it as part of board recruitment and succession planning.

The findings are based on a survey of 64 FTSE 350 board members by KPMG UK’s Board Leadership Centre, which was undertaken to build an accurate picture of socio-economic representation on UK boards, as well as the challenges to driving greater socio-economic representation at the most senior levels:

• Over 70% of respondents come from high socio-economic (professional) backgrounds, while only 15% came from low socio-economic backgrounds – suggesting a lack of socio-economic diversity in boardrooms
• 28% of respondents attended a private school, suggesting an over-representation of privately educated board members when private schools account for just 7% of the UK’s pupil population today
• Respondents also highlighted the importance of networks and mentors in reaching the highest levels of business, with 67% stating they benefited from access to both

Socio-economic background is the combination of income, occupation, and social background, and is a key determinant of access to opportunity, success, and future life changes.

KPMG’s research also highlighted that only a small number of FTSE businesses are tracking the socio-economic background of board members (84% said their boards are not measuring it), while over two-thirds (69%) said their nomination committees were not factoring it into succession planning, suggesting a lack of prioritisation, compared with other diversity metrics. 92% of respondents were not asked about their own socio-economic background in their recruitment process.

And while 83% said they were comfortable sharing their background, of those who were not, some thought they would be viewed with bias if they came from a privileged background, others thought it was better for others to assume they came from the ‘right background’, while others thought it was ‘self-focused’.

Commenting on the findings, Bina Mehta, Chair of KPMG UK, said: 

“Over the past decade there has quite rightly been a focus on ethnicity and gender representation in business, and progress had been made in recruiting from a broader base. However, socio-economic diversity has not been a focus, particularly in the make-up of boards, with few businesses reporting on their work to improve social class diversity or factoring it into board recruitment or succession planning.

“Research continues to show that where you come from and what your parents do for a living has an impact on the opportunities that are available to you in life, from work experience and career aspirations, through to hobbies and interests. A focus on social mobility is vital to create a fairer, more equitable society.”

KPMG UK’s Board Leadership Centre’s latest report – Uncovering social mobility in the boardroom – can be viewed in full, here. 

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Notes to editors:

• Last year, KPMG UK was the first large business in the UK to set a target for the number of employees from low socio-economic backgrounds, aiming for 29% of its partners and directors to come from working class backgrounds by 2030 (currently 23% and 20% respectively)
• Currently, 44% of KPMG’s UK board are women, 22% are from an ethnic minority background, and 13% are from a low socio-economic background.