Food and grocery demonstrate appetite for diversity but more needs be done, finds IGD report

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Although the vast majority (84%) of companies in the food and grocery industry believe they are performing better today than they were five years ago on diversity and inclusion, fewer than half (45%) of businesses have adopted a co-ordinated strategy on the topic. And despite a genuine desire to do more across the industry, there is a reluctance to talk more openly about diversity and inclusion in case businesses are seen to be ‘behind the curve’.  

These are the findings from a first-of-its-kind report into diversity and inclusion (D&I) in the food and grocery industry, launched today by research and training charity IGD and executive search firm The MBS Group, in association with PwC.

Drawing on data captured from over 200 companies and conversations with more than 100 Chairs, CEOs and HR Directors, the new report, Diversity in Food and Grocery aims to paint a true picture of diversity and inclusion in the industry, and to highlight some examples of how a number of organisations are driving greater diversity in practice.

Key findings include:

  • The median gender pay gap within the food and grocery industry is lower than the UK economy as a whole (6.8% versus 9.6%), according to analysis by PwC; however, fewer than 10% of companies surveyed are prepared for ethnicity pay gap reporting if it is introduced in the coming years
  • On gender, an average of 27.6% of Board roles are occupied by women. At Executive Committee level this drops to 22.2%, while 35.9% of Direct Reports (into the Executive Committee) are women. Compared with the latest Hampton-Alexander Review figures, food and grocery is ahead of the FTSE 350 cross-industry average at the Executive Committee and Direct Reports levels, although is unlikely to reach the Hampton-Alexander target of 33% women by the end of 2020
  • At 11.4%, the percentage of Board members in the food and grocery industry from a BAME background is very close to reflecting the UK working age population at large (12.5%). Some 5.7% of Executive Committee members and 7.1% of Direct Reports are BAME. Most companies do not collect complete data around ethnic diversity
  • When asked to consider their wider senior leadership teams, 27% of interviewees were able to identify an openly LGTBQ leader within their business. As most companies do not collect data on LGBTQ, it is difficult to measure how accurately the food and grocery industry workforce reflects wider society. The most common approach to the LGBTQ agenda is to focus on promoting an inclusive working environment, often by working with outside not-for-profit organisations
  • 15% of interviewees were able to identify someone with a physical disability, although no one was identified at the Executive Committee level, despite 19% of the working age population having a disability. Again, most companies do not collect data on disability, but the approach to physical disability tends to be more reactive than proactive

·        At the leadership level, across a sample of more than 50 companies, the average age of Board members in food and grocery is 57 years old. This is slightly below the average across the FTSE 350 of 60 years old, while at 54, the average age of Executive Committee members is in line with the FTSE 350. With an ageing population, it is now common for businesses to have three generations within the same teams, while constantly evolving advances in digital and technology are resulting in companies looking to new talent pools and reskilling existing employees to meet the challenge

  • Nearly 70% of interviewees believe that food and grocery is one of the best industries for promoting social mobility, while two-thirds of companies reported that they are taking active steps to encourage it. Measuring success is difficult, though, as there is not only a lack of data in most companies but there is also a lack of clarity around how to define social mobility and what indicators individual companies can realistically assess progress against
  • Nationality is sometimes confused with ethnicity. In the context of a looming labour shortage and the UK’s changing relationship with the EU, this could be a useful lever for improving productivity. Across a sample of 50 companies across the food and grocery industry, 82% of Executive Committee members are British, compared to an average of 73% across the FTSE 350. Of the remaining Executive Committee members, there is a strong bias towards EU nationals (13% versus 5% of nationals of non-EU countries)

Susan Barratt, CEO of IGD, said: “Studies have shown that more diverse and inclusive workplaces have a higher level of employee engagement, are more productive and are more profitable. The response and interest in this project from across our industry has been fantastic; there’s no doubt much is happening at an individual business level as well as collaboratively. However, this research also clearly demonstrates there is a need – and an appetite – to do a lot more.

“The progress that has been made in gender equality and the wide range of initiatives already in place to nurture female talent is particularly encouraging. But there are other levers of diversity beyond gender that can also help to create a diverse workforce – age, ethnicity, LGBTQ, social mobility and disability, amongst others. The research shows there is much more to do in these areas, to help businesses unlock new sources of talent for the future. IGD will continue to champion this important topic and make sure it stays high on our industry’s agenda.”

Jon Terry, people and organisation consulting partner, PwC UK, said: “While the case for diversity and inclusion is strong in all business sectors, it’s especially so in an industry like food and grocery, where the customer reigns supreme. What’s clear from businesses that are making the strongest progress on diversity is that this requires the same board-level direction, organisation-wide push, understanding of the data and regular reporting, intervention and incentives that would be applied to any other strategic priority. In short, diversity and inclusion need to be a part of an organisation’s strategy and its cultural DNA.”  

Elliott Goldstein, managing partner, The MBS Group, said: “Food and grocery is very much a data-led sector. It is our hope and belief that by providing our sector with a snapshot of diversity today, the findings will enable organisations to benchmark themselves against their peer group, and adjacent sectors/industries, and to act as a catalyst to change and development. The food and grocery industry can be proud of the progress is it has made to date changing the dial in diversity – but with just 22.2% of Executive Committee members being women, it is clear that as a sector there is still some way to go.”

The full report is available to download at www.igd.com/diversity