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School of Business and Management

CRED blog series: The Sewell report: A flawed understanding of racial inequalities in employment

Published:

Elena Doldor, Tessa Wright, Mark Williams, Geraldine Healy, Doyin Atewologun
Centre for Research in Equality and Diversity
School of Business and Management, Queen Mary University of London

The recent report by the Commission on Race and Ethnic Disparities (also known as ‘the Sewell report’) has been widely criticised for denying the significance of systemic, structural and institutional racism and for its misinterpretation of academic research and data across a number of areas including health and education. As researchers specialising in equality and diversity in employment based at the Centre for Research in Equality and Diversity, we too were very surprised by the conclusions of the report in the ‘Employment, Fairness at Work, and Enterprise’ section. In this article we take issue with the report’s faulty and selective interpretation of its own evidence base and highlight the extensive research on race and ethnicity at work that does not support the report’s recommendations that primarily call for individual and family-based remedies for disadvantage. Instead we show why measures to tackle systemic and structural race inequality in work organisations are still needed if we are serious about tackling disadvantage in the UK.

Selection and interpretation of evidence

A key criticism levelled against the report and the commission’s consultation process has been its selective and non rigorous use of academic expertise. This faulty approach is visible in the section on racial inequalities at work, where leading experts in social sciences and key studies have been neglected. In the evidence the report does draw upon, it offers a selective discussion and questionable interpretation. Perhaps one of the biggest faults of the report is not placing greater weight on evidence according to its research design – a standard approach to systematic reviews – in reaching their conclusions. This is especially pertinent in relation to the CV studies cited in the report (e.g., Heath and DiStasio). These kinds of real-world experimental studies are widely regarded as the gold standard of evidence, but are completely underplayed (p. 122). These studies show that ethnic minority British job applicants need to apply for 60% more jobs to achieve the same level of call-backs as white British applicants. What is more, for some groups, one review of UK field studies showed things have not improved since the 1960s. Instead of placing due weight on studies such as these, the report makes ample use of cherry-picked quotations from call for evidence responders. We illustrate below this selective use of evidence in three core areas.

Ethnicity pay gaps

In its own analysis of ethnicity pay gaps, the report finds substantial pay penalties for all ethnic minority groups, even when adjusting for their superior educational credentials heralded in another area of the report as a success story. It does not adequately comment on these quite damning pay gaps (p. 111), nor that these penalties have remained constant for the last two decades, presumably because they do not fit in with the report’s conclusions, instead swiftly moving onto social mobility, which is accompanied by an in-depth discussion where there are more positive things to say. 

The report rightly gives space to health service workers including doctors. The Commission seems to simplify doctors’ very complex contractual arrangements. The Surash and Pearce (2019) report reveals the complexity of doctors’ pay and the uneven outcome by ethnicity. Their work is important and reflects earlier CRED work. Oikelome and Healy’s (2007) study found that doctors qualified overseas (called international Medical Graduates - IMGs) earn more than UK qualified doctors, work longer hours, have less autonomy, lower morale and were less successful in applications for discretionary payments. Additional hours were a key explanatory factor here. The study showed that women IMGs are most disadvantaged compared to IMG men and UK qualified women and men. The Commission recommends a strategic review (p.120) including investigating if foreign qualifications may be equally validated but informally considered as inferior and whether pay is the most appropriate metric. Our work suggests we have this information; that pay metrics are important but should be considered alongside morale, working hours, autonomy and application for discretionary awards and intersectional differences. Gender differences are also revealed in Surash and Pearce (2019) and intensified at the consultant level. Woodhams (2015) clearly showed that there is a multiplicative effect the more protected characteristics a person has. We are mindful that the Commission neglects the importance of an intersectional approach. 

Surash and Pearce (2019) reveal that Clinical Excellence Awards (CEA) are differentially awarded by ethnicity. Earlier work showed that IMGs needed to make more applications compared to their UK qualified applicants and that women IMGs were most disadvantaged (Oikelome and Healy 2007, 2013). The NHS is heavily reliant on IMG doctors and yet their place of qualification may be missing from data sources. The level of discretion in such awards is part of the pay gap problem and reflects embedded practices. 

Managerial discretion through bonuses and special payments, all supported by pay secrecy, provides the structural conditions for discriminatory pay and ethnicity pay gaps. This is found in CRED research on financial services (Healy and Ahamed, 2019) and academic work (Pfefer, 2020). Key actions that could reduce ethnicity and gender pay gaps, which have not been discussed sufficiently in the Commission’s report, include: remove pay secrecy at the local level, remove previous pay in new job applications, include diversity performance in appraisal schemes, introduce positive action strategies to overcome the deep-seated structural disadvantage evident in research and everyday experience.

Bias at work

The subsection on bias at work focuses predominantly on experimental field studies of job applications versus call-back rates, which have documented indisputable racial bias in hiring processes. The section glosses over a host of studies that reveal unique career obstacles faced by ethnic minorities beyond hiring processes, when it comes to upwards career progression in organisations. For instance, it is widely acknowledged that racism and discrimination in the workplace are nowadays less often overt and explicit; instead, more subtle forms of racism and exclusion plague the work experiences of racialised professionals, such as: selective invicivility and white defensiveness against selective incivility claims (Ozturk & Berber, 2020); casual workplace interactions (micro-episodes) during which the status of ethnic minority professionals is being challenged (Atewologun & Sealy, 2014); and exclusion from informal political processes conducive to career progression (Wyatt & Silvester, 2015). The report fails to engage with more nuanced understandings of subtle racism in workplace dynamics. 

It was notable and somewhat surprising that the Commission felt it necessary to commission new research on occupational preferences (p. 199) to explain variance in ethnic representation in managerial roles; the study found that a higher number of Black respondents disagree that their manager and others more senior provide them with feedback to become a manager, in comparison with White respondents. It was stated that these findings merit better understanding as ‘there are simple HR activities which can address these perceptions’. We found the assumption that ‘consistent and effective feedback could easily be resolved’ (p. 119) surprising and concerning. The evidence suggests that deep-seated and ingrained values are likely to override simple systems of effective feedback. Earlier studies from our research centre and elsewhere show that the reproduction of poor management and the undervaluing of women and ethnic minorities requires more radical action (Bradley & Healy, 2008; Bradley, Healy, Forson, & Kaul, 2007; Healy, Bradley, & Forson, 2011; Healy and Oikelome, 2011, Hudson, Netto, Noon et al, 2017; Kirton, Greene and Dean, 2007; Noon, Healy, Forson, Oikelome, 2013; Noon, 2010). More recent studies suggest that gender and racial bias persists in the developmental feedback and career advice received by leaders, such that women and ethnic minorities receive feedback that is less useful for upwards career progression (Doldor, Wyatt, Silvester, 2021; Wyatt & Silvester, 2015); for instance, such feedback is less specific and actionable, even when framed positively. Therefore, there is subtle systemic bias in the feedback and career development systems that shape the attainment of managerial and leadership roles across ethnic groups; such bias is not properly acknowledged in the report. Moreover, as Hudson et al. (2017) state, the potentially deleterious influence of homosocial reproduction in perpetuating labour market inequalities and discriminatory boundaries between groups deserves tangible recognition and redress in employment policy.

Organisational practices often work to the detriment of some ethnic minority groups. Many women, in particular from the Bangladeshi and Pakistani ethnic groups, believed they were discriminated against (EOC, 2007; Healy et al, 2011), where appearance, religious belief and traditions were repeatedly questioned and there was a perceived obligation to participate in out-of-work activities that made them feel uncomfortable. Kirton’s (2009) study of ethnic minority business graduates (45% of Black, Pakistani and Bangladeshi heritage), showed their poor socio-economic background endowed many with a strong determination to succeed and had influenced them to take a vocationally-oriented degree as a safe route to a well-paid career. Over half the interviewees agreed that ethnic minority people face discrimination in management careers and most felt that racism was a reality that might affect their careers - not so much at the entry point, but at higher levels in the hierarchy. Kirton concluded that the graduates demonstrated a healthy scepticism about their career chances which should help to prevent them from becoming simply passive victims of a self-fulfilling prophecy. In other words, they enter the labour market with positive expectations but their aspirations are often dashed.

Such evidence of subtle but entrenched forms of racial bias across organisational processes and practices was not adequately addressed by the Commission.

The under-representation of ethnic minorities in leadership

While the report acknowledges that affinity bias leads to homogeneous leadership, there is a neglect of evidence on other causes responsible for the under-representation of ethnic minorities in leadership. For instance, while the Commission noted the uneven pattern in ethnic minorities’ representation in the most senior positions in the private sector (p.114-115), it failed to reveal evidence that few FTSE 100 have systems in place to understand ethnic disparities (Beech, Cornelius, Gordon, Healy, Ogbonna, Sanghera, Wallace, Umeh, Woodman, 2017). This report, co-funded by the Chartered Management Institute (CMI) and British Academy of Management (BAM), noted that not a single one of the diversity leaders interviewed rated their company’s current performance on race equality as ‘very good’; only 54% said that senior business leaders were championing race diversity (Beech et al., 2017).

Where evidence regarding the causes of racial inequalities in leadership does exist, the Commission inexplicably glosses over it. For instance, the report only mentions in passing the Parker Review - arguably the most substantive national initiative for addressing ethnic under-representation in Britain’s corporate leadership. The most recent publication of the Parker Review (2020) highlighted that persistent under-representation of minority ethnic individuals in leadership roles in the UK is due to ‘talent bias’, described as institutional practices that have developed for the identification, development and appointment of talent in the UK, showing little appreciation of the benefits that ethnic diversity can bring to the Boardroom, accompanied by a logic that ‘that which has worked in the past will continue to work in the future’. This definition clearly signals that racial bias at work is not just interpersonal, but systemic. Following the launch of the Parker Review in 2016, a UK-wide consultation process explored responses to the review’s aim to focus on ethnic representation on UK boards. Following the consultation, written and verbal feedback was compiled from members of the public as well as from FTSE Chairs, NEDs, executive search firms, and representatives from the FRC, the EHRC and the Information Commissioner’s Office. The report and results of the consultation demonstrated the importance of a number of institutional levers that needed to be leveraged to increase the representation of minority ethnic individuals in leadership positions. The report indicated that a company’s nomination committee and executive search firms had key roles to play in driving D&I within an organisation, referencing the progress that these stakeholders had played in advancing gender diversity in boards. Further, there was also a recognition that companies and search firms need to do more with regards to identifying and showcasing existing pools of qualified candidates from ethnic minority backgrounds. The report also highlighted the importance of organisational training and development including reverse monitoring. These recommendations indicate a need to address racial inequalities.

This point is further underlined by the recent report from Business in the Community, which charts the multiple initiatives in place to address racial inequality, building on the McGregor-Smith review of race in the workplace, published in 2017. 

Recommendations that sidestep systemic interventions 

The misinterpretation of research evidence outlined above allows the report to conclude that systemic or structural racism is no longer the major cause of the disadvantage faced by ethnic minority groups, which thus must be a result of other factors. Where these are not thought to be related to geography, social class or other factors, the report emphasises individual or family failings. For example, the solution to insufficient Black people getting the professional jobs they expected after graduating is to “examine the subjects they are studying and the careers advice they are receiving” (p.53), which overlooks the substantial evidence of labour market discrimination faced by ethnic minorities demonstrated by the CV studies.

This ‘fix the individual’ approach flows through other recommendations, including Recommendation 8 to Advance fairness in the workplace which advocates a replacement of unconscious bias training with mandated sponsorship groups for ethnic minority individuals, and training and routine skills support for all employees in their professional and personal lives. We support the questioning of unconscious bias training based on limited evidence of its impact on changing behaviours, beyond mere awareness raising (Noon, 2017; Atewologun et al., 2018). We advocate instead that unconscious bias needs to be tackled not only by raising awareness at individual level through training, but also by scrutinising and altering how people-related decisions are made across HR/talent management processes at organisational level (Vinnicombe, Doldor & Turner, 2014). Our evidence therefore suggests that organisational actions are necessary and effective strategies for tackling racial inequality in organisations. 

Field studies conducted such as the Middle Research have demonstrated the role that multiple stakeholder groups have to play to advance racial inclusion. This study of HR, D&I professionals, Network Leads, and Executive Sponsors from over 60 blue chip organisations indicated that these groups have divergent, and sometimes conflicting perspectives and concerns regarding racial inequalities at work, and have the potential to make different valuable contributions to advance race inclusion. Therefore, it is likely that collaborative action for each stakeholder group that takes into consideration these different positions will provide critical organisational level interventions for advancing racial inclusion and equity in the workplace.

It is unsurprising that the Commission provides no convincing discussion of organisational actions, such as equality data collection, equality action plans, or equality impact assessments (EIAs), given its rejection of structural level race discrimination. The requirement for EIAs to be conducted by public authorities was originally contained in the Public Sector Equality Duty, already known to be unpopular with a previous Conservative government that undertook a review, but backed away from repealing it, due to lack of supporting evidence (Stephenson, 2014). However there is evidence of the effectiveness of EIAs in changing organisational behaviour in relation to decision-making and policy formation on equality (Conley, 2016) and we would argue that organisational level tools and strategies to address race inequality at work are needed more than ever.

In its brief references to potential organisational interventions, the commission’s report demonstrates a facile understanding of the conceptual and practical debates in the field of equality, diversity and inclusion. For instance, statements such as “Diversity training and policies that treat people differently according to ethnicity does not work” (p. 125) are, at best, simplistic; diversity and inclusion are not fostered by treating everyone the same regardless of race or gender, but rather by acknowledging entrenched disadvantages and seeking to correct them through more inclusive workforce-related practices and processes. The report also erroneously claims that interventions such as quotas “overtly discriminate against some groups” (p. 125), failing to acknowledge that voluntary diversity targets (a ‘soft’ version of quotas, recommended by the recent Davies and Hampton-Alexander Reviews) have been effective in increasing gender balance of FTSE corporate boards over the last decade; the same approach has been recommended by the Parker Review to increase ethnic representation in FTSE leadership. 

Consistent with the individualist emphasis, the report recommends a ‘Family support review’ (Recommendation 19) with a focus on ‘cultural attitudes and parenting styles’, the role of fathers, and flexible work support for single parents. While the latter point highlights the role of organisations, it is unclear what it is adding to the existing regulations that enable all employees to request flexible working.

The report offers some suggestions on the role of policy-makers and regulatory bodies. The Equality and Human Rights Commission (EHRC) has the power to serve compliance orders on public authorities that do not carry out their duties under the PSED, so we welcome Recommendation 1 of the Commission’s report that the EHRC should receive “additional, ring-fenced funding from the government to use their compliance, enforcement and litigation powers to challenge policies or practices that either cause significant and unjust racial disadvantage, or arise from racial discrimination” (although we haven’t forgotten that it was a previous Conservative-led government that slashed the EHRC’s budget by 70% between 2010 and 2016).

We believe there are extensive shortcomings in the report’s interpretation of its own research, in its refusal to engage with the overwhelming weight of research evidence that points to continuing systemic racial inequalities in organisations and in its omission of recommendations made by highly-regarded prior reports such as the Parker Review. We therefore have little confidence that the recommendations made in the Sewell report will seriously address the well-evidenced ongoing disadvantage in recruitment, career progression and pay faced by ethnic minorities in the workplace, labour market and boardrooms. There is no shortage of clear evidence of ongoing racial disadvantage at work, nor of business and organisational expertise in what works to address this, as we have shown here. Our collective experience of many years of research into equality and diversity in employment leads us to join others in calling on the Government to reject the recommendations of this Commission and instead look again at implementing the workable recommendations of the McGregor-Smith and Parker reviews.

 

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Elena Doldor is Associate Professor (Reader) in Organisational Behaviour and Co-Director of the Centre for Research in Equality and Diversity at Queen Mary University of London, School of Business and Management. 

Tessa Wright is Professor of Employment Relations and Co-Director of the Centre for Research in Equality and Diversity at Queen Mary University of London, School of Business and Management. 

Mark Williams is Associate Professor (Reader) in Human Resource Management and member of the Centre for Research in Equality and Diversity at Queen Mary University of London, School of Business and Management. 

Geraldine Healy is Emerita Professor of Employment Relations and member of the Centre for Research in Equality and Diversity at Queen Mary University of London, School of Business and Management. 

Doyin Atewologun is Dean of the Rhodes Scholarships (University of Oxford) and Associate member of Centre for Research in Equality and Diversity at Queen Mary University of London, School of Business and Management.