Progressing Socio-Economic Diversity

In this episode I speak to Sophie Hulm, Chief Executive of Progress Together, a membership organisation for the UK financial and professional services sector that focuses on progressing the socio-economic agenda in firms particularly around developing and retaining talent.

Sophie Hulm is the Chief Executive of Progress Together which specialises in socio-mobility and socio-economic diversity, particularly within the financial and professional services sector. Having worked for organisations like Accenture and Deloitte, I know that this is a huge diversity item that has to be addressed within the City of London.

I was excited to sit down with Sophie to learn more about her personal background, why socio-economic diversity is so important to the diversity and inclusion agenda and the work that she’s doing to address this for organisations with Progress Together. 

We started off the conversation with Sophie telling me a bit more about herself and what led to her running Progress Together.

‘I’ve worked in the City of London Corporation for a decade or so with financial and professional services across the UK on three different agendas. One is skills policy. How do we ensure that the UK’s financial and professional services sector has the skills it needs to be globally competitive. Before that, I worked in corporate responsibility, so supporting the sector to develop responsible business programmes and then I moved to a focus on socio-mobility and specifically socio-economic diversity. 

I’m interested in this because I used to work for a welfare to work organisation as an employment advisor 20 years ago. I supported clients that were long-term unemployed to get them into jobs. I found that the employers weren’t taking them seriously, and I thought, “Well, actually I want to try and tackle this from the other end”. That’s when I moved into the City to see whether I could do something from that perspective and work with employers to work with diverse range of candidates.’

I asked Sophie to tell me more about what Progress Together is, and the work that the organisation does? 

‘Progress Together is a membership organisation. It specifically helps UK financial services firms to get better at socio-economic diversity. We look at senior level socio-economic diversity. What we’re finding is that lots of employers focus on access and outreach, they’re working with schools, getting a diverse group of individuals into the bottom ranks of the organisation, but what we’re finding is that talent doesn’t stay. 

Across the sector, 50% of employees come from non-professional backgrounds by parental occupation at 14 which is the definition of socio-mobility that the Social Mobility Commission use. But we know that that they’re not staying, and we’ve got evidence to show that at senior levels, 89% are from professional backgrounds, so there’s a big drop off. That’s what Progress Together is all about: supporting employers to keep the talent that they’ve worked so hard to get within the organisations. We want to retain the talent, to progress and then move their way up to the top.’

That resonates with my experience because we do a lot of diversity and inclusion surveys for our clients and ask questions around socio-mobility. One of those recommended questions is to ask is about parental occupation and we have similar findings in the surveys that we do ourselves as well. I asked Sophie why she thinks that socio-economic diversity is an important diversity and inclusion element that employers should be focusing on? 

‘Often it is the one that’s been left behind, frankly. It’s not a protected characteristic. Socio-mobility is becoming more of interest to firms, but we know, for example, from the Women in Finance Charter, that of all 209 signatories to the Women in Finance Charter only 27 of them collect socio-economic background data. So, although, firms are interested in socio-mobility, not very many firms understand the socio-economic make up of their employees. I think because it’s a hidden characteristic, it’s important for firms to get a sense of what their employees’ backgrounds are so that they can support them to progress.

We did a piece of work with The Bridge Group two years ago and we found that there was a 25% progression gap. This means those from lower socio-economic backgrounds progressed 25% slower than their peers, and there was zero link to performance. This is having a damaging effect on our employers and the individuals themselves. We interviewed over a hundred individuals, and they said that they were wasting energy conforming to dominant cultures, and this was impacting individual performance. 

As someone that’s very focused on ensuring that the financial services sector has the skills it needs to be competitive, we have to ask ourselves what’s the productivity impact here? If we find that we’re getting people in and they’re wasting so much energy conforming to those dominant cultures, that’s impacting whether they stay and bring their best selves while they’re in work. That’s why it’s so important, I think, for organisations to not just look at their protected characteristics, but also socio-economic background.’

That makes a lot of sense, since when people leave an organisation that costs a business money. When I interviewed, Emma Codd the Global Lead on Diversity and Inclusion for Deloitte, one of the things that she did to try and build the business case for diversity at Deloitte was calculate the cost of women leaving the business for work life balance reasons. It ran into the millions. I’d encourage people to go back and listen to that episode with Emma, because she used that as a way of trying to get partners on board, because she would say to the other partners, “Look, I’ve got X millions of pounds on the table, shall I just throw this out the window?” It’s quite an effective way of getting senior leader buy in.

Sophie agreed, adding, ‘We did a piece of work with The Bridge Group two years ago and we found that there was a 25% progression gap. This means those from lower socio-economic backgrounds progressed 25% slower than their peers, and there was zero link to performance. This is having a damaging effect on our employers and the individuals themselves.’

The City of London also recently produced some research titled “Building the Baseline” where they look at the intersectionality between the different diversity and inclusion lenses including within UK financial and professional services sector. I think they surveyed 49 employers and 9000 staff and they found that of senior leaders 45% of senior leaders were White men from professional backgrounds, and then it goes down to 1% of senior leaders who are ethnic minority females from working class backgrounds. You don’t get that detail until you start collecting data on all the different characteristics. It’s only with that data you can target interventions, to those employees that need the extra support.’

At my company Mildon, we’ve had some interesting client case studies myself. I’ve been working with a professional services firm, and over 30% of their employees were privately educated. Whereas I think it’s something like 7% of the UK population went to private school. This was creating a certain culture in the organisation, and anecdotally people were saying things like, they go to work in the morning and their colleagues are talking about the skiing trips that they’d been on, and they felt that that was something they couldn’t relate to. There also seemed to be this divide between the kind of fee earners, who were predominantly privately educated and the operational support staff. 

Another client case study was with a manufacturing company. Most of their staff live within a couple of miles the factory and a lot of the workforce haven’t been to college or university. Their parents worked in manual jobs as well, and what this particular client has realised is that they can help people with their social mobility, by skills development within the business. So, they’re looking at how somebody can move from the factory floor to say the marketing department, if that’s what they want to do. They are also thinking about what they could do with local schools and colleges as well. Those are two very different examples of how I think organisations are considering social mobility and responding. I asked Sophie to share her thoughts on these different approaches. 

‘I think it depends on the sector. Senior sponsorship is critical to progression in financial services. Mentoring is impactful. Mentoring works and reverse mentoring works, but we mustn’t forget that this isn’t about changing people. Why should they have to change their accent? Why should they have to conform to fit in? 

We need to make the processes work for everybody in the firm, and not just focus on how people can change to fit the firm. If you have transparent processes around access to senior sponsors, or transparent processes around work allocation, so who gets the meaty projects for example. If you have those transparent processes around promotion, that will support those individuals that don’t necessarily have the familial, or educational connections within a firm, or someone that they can talk to about the golf club that they both went to at the weekend.’

Sophie has touched on this already but I think it will be good to understand more why Progress Together focuses specifically on socio-economic diversity at the senior levels within the UK financial services

‘It’s because we identify the gap. There is a huge amount of work taking place in access and outreach and there are so many wonderful organisations supporting firms with that. From the Social Mobility Foundation to upReach and the Sutton Trust, there’s lots out there. But we found that there wasn’t that support for employers to really focus on the progression piece. For the employers, that’s the next step really. 

Employers aren’t collecting the data and they’re not tracking the data and those rates of progression. That’s where the competitiveness piece comes in for firms. As I said earlier, it’s a waste of time and effort if you’re focusing on getting people in through the doors and appealing to school children and young apprenticeship students, but then they leave if you don’t get the progression piece, right. It’s a waste of time and effort.’

Sophie has been involved in setting up a task force for the government. I asked her about her role in that and what the work of the task force leads to? 

‘It was commissioned by government departments BEIS and HM Treasury. In 2020 the commissioning ministers John Glenn and Nadim Zahawi asked the City of London to lead a task force aimed at boosting socio-economic diversity at senior levels across UK financial and professional services sector. I was the architect for the task force and designed how it worked and led it for the last eighteen months. The task force was chaired by Catherine McGuinness, the City of London’s former chair of policy, and has three workstreams. One was setting up Progress Together, which we can talk about, and that work stream is chaired by the Lord Mayor, Alderman Vincent Keaveny. Another work stream is chaired by Andy Haldane, former chief economist of the Bank of England and now CEO of the RSA. The workstream that Andy is leading looks at what is the productivity piece and the business case around greater socio-economic diversity? 

We already have some research on this but employers are asking us for more and more, asking’ “If we’re going to do this, what’s that going to mean for the business? Yes, there’s a fairness point, that’s obvious, but also, what’s the business case?”

The third workstream is chaired by Sandra Wallace, former co-chair of the Social Mobility Commission, and her work stream is an industry consultation to find out what can government sector bodies and regulators do to incentivise employer action in this space.

Employers are telling us, “Okay, we’ll do this. We believe in it. But actually, we’re going to wait a little bit until the regulator’s really pushing us to collect that data and do something about it”. We’ve been engaging with the regulators, so the FCA, PRA, Bank of England, and their consultation is due to come out soon to ask for regulated firms to do this. 

We’ve looked at what should they be doing in this space and their discussion paper came out last year. Socio-economic background was front and centre of it. I expect that it will be included in their consultation that’s expected in the next couple of months. So, the regulators are taking this seriously, which is what employers are waiting for really.’

These sound like three impactful workstreams. I was curious to know why social mobility is so important to Sophie. 

‘I remember my dad being on the dole. I remember him applying for jobs that he didn’t want. I remember my mum as a mature student, trying to get a better education to make more of where she was. It’s important to me on a personal level because of those memories. 

I also remember an interview about fifteen years ago, where the interviewer noticed I had gone to university in Bristol. Even though I’d been to the best performing business school for my particular course, I knew that she was referring to her own university, which is a red brick university in the same area, and she assumed that I had been to the same university. Knowing that I’d been to a former polytechnic, I didn’t correct her, I didn’t say, “No, actually, it’s a different university”. And that feeling in my core, of feeling embarrassed about my upbringing, made me want to do something about this. 

A few years later, I had a conversation with our former chair of policy at the City of London, so our most senior politician, and he was speaking about his background to a group of academy students. We realised that he’d gone to a former polytechnic as well. At that point, I thought, “Okay, my background shouldn’t hold me back. I shouldn’t be embarrassed about the level of education I’ve got, what my mum or dad did for a job. I shouldn’t be embarrassed about any activity I have as my hobby. The fact that I didn’t go on any skiing holidays, I shouldn’t let that hold me back”. 

That was the light bulb moment. I’m really keen for others within financial and professional services and across the whole economy to have access to those role models that say to you, “It’s okay. You don’t have to have go on skiing holidays. You don’t have to be able to talk about which golf club you’re a member of. You don’t have to change your accent”. We should be accepting of everyone regardless of their background because diversity of background, diversity of individuals brings diversity of thought and thinking just now about financial services sector, we have huge societal and economic challenges to contend with, and it requires greater innovation. The senior levels make the decisions, bring around cultural change and set the tone. If we don’t have diversity of thought at the top, then I think that’s a problem for the sector and for the economy and for the country as a whole.’

I agree. It definitely does. It’s not just the financial services industry that’s facing this, the whole country is facing a lot of societal challenges. We are becoming an ever more diverse country. So, the talent that we can draw from is incredible, but the question is, are we being as inclusive as possible when people arrive in a business? Because if we’re not, then we are not setting people up for success and we’re not helping them thrive in their roles. I asked Sophie where she sees socio-economic diversity in the next five to ten years? 

‘In an ideal world, Progress Together won’t exist, because we would’ve reached enough organisations. They would’ve made a change, started collecting data to figure out what their starting point is. They’d set their own targets and want to get to parity. 

Across financial services, we know what the workforce looks like, at all levels of seniority. We know that across all sectors, because the Labour Force Survey has that data. We know what the economy looks like in terms of socio-economic background within specific sectors and across the UK working population. We want the makeup at the top to represent the whole workforce within an organisation and a sector, and ideally within the UK working population as well. It shouldn’t be any different at the top as it is with the rest of the population of the workforce.’

I know how important it is for organisations to prioritise social mobility and to make sure that it’s included in their diversity and inclusion strategies. I work with so many organisations that have a D&I strategy, but the strategy just focuses on one area, say gender balance at board level but it doesn’t take into account other aspects of diversity. 

Sophie was keen to make an additional point. ‘I would just say that this isn’t diversity top trumps. This is not about socio-economic background competing against gender or race or any other of the characteristics. If we get this right, the correct transparent processes, for example, around work allocation or promotion, then it will work for all employees regardless of whether we’re looking at gender, race, or socio-economic background, disability and so on.’

To round out this great conversation on the Inclusive Growth podcast, I asked Sophie the same final question I ask all my guests, ‘What does inclusive growth mean to you?’

‘It’s growth that positively impacts everybody. For Progress Together, this is not about supporting one group of individuals over another. This is about levelling the playing field for employees from all socio-economic backgrounds, so it’s not that one socio-economic background is better than the other, it’s just that we want opportunities to be the same for everybody. We want that so that individuals grow, so that our organisations grow, so that the economy grows, so that as a society we grow because everybody is involved in that and is included in that growth.’

To find out more about Progress Together visit their website where you can find all sorts of offers that members in the financial services can benefit from. These include peer mentoring workshops, webinars and access to tools and resources that will help with data collection and benchmarking in member organisations.

Progressing Socio-Economic Diversity - Mildon