Why racism is a business issue
The latest phase of the Black Lives Matter movement has helped to clarify for a lot of people how pervasive and powerful structural racism is. It affects organisations even when they are not overtly racist.
We explore how this is likely to affect your business, and what steps you can take to address it, and look at the duty of all of society to educate themselves on the nature of racism, with organisational psychologist John Amaechi, Pinsent Masons lawyer Alexandra Aikman and diversity and inclusion consultant Stuart Affleck of Brook Graham.
To better understand the issues covered in this programme, try:
Black And British by David Olusoga
Brit-ish by Afua Hirsch
Natives by Akala
Bordering Britain: Law, Race and Empire by Nadine El-Enany
Why I'm No Longer Talking To White People About Race by Reni Edo-Lodge
Whistling Vivaldi: How Stereotypes Affect Us and What We Can Do by Claude Steele
Hello and welcome to the Brain Food Podcast for general counsel from Pinsent Masons. My name is Matthew Magee and I am a journalist at Pinsent Masons.
Black Lives Matter protests have dominated the streets and the headlines this summer in reaction to police killings of black people in the US, sparked by the killing of George Floyd.
The protests have led to more debate about the nature of racism in the US, the UK, Europe and elsewhere than we have seen for some time and the spotlight has been shone not just on individual acts of brutality, but on the structural and institutional nature of racism in developed economies.
Racial prejudice is ingrained from frighteningly young ages; opportunities are given disproportionately to white people, and advantages of capital, class and culture that stretch back to the days of slavery still act in favour of white people and against the interests of people from black and minority ethnic backgrounds.
If you doubt how deep these roots go, just remember that the UK only stopped paying back interest in 2015 on loans it took out to pay compensation when it outlawed slavery, and that the compensation was paid to the slave-owners, not the people who were enslaved.
So if you were listening to this and thinking 'what has this issue got to do with business?', hopefully you're not thinking that now: this is an issue that is so ingrained into our culture that it affects your business, whether you have realised it or not.
Business leaders might think that the world of commerce is reasonably polite and sensitive, that workplaces are civilised places with no racism problems, but their employees will tell a different story. A YouGov poll last month found that black people in the UK were as likely to experience racism in the workplace as on the street.
As we'll hear from organisational psychologist and leadership expert John Amaechi, most organisations believe they are meritocracies, and most organisations are not. Bias is a part of processes, attitudes and assumptions: if you look properly you will find problems, he says, and fixing them is arduous, unglamorous, boring and essential.
Change must happen if the experience of Pinsent Masons lawyer Alexandra Aikman is not to be repeated. Her experiences of racism in business are all the more shocking because they are contemporary: this is very much a live issue.
Stuart Affleck of Pinsent Masons' diversity and inclusion consultancy Brook Graham will help us to navigate the kind of action that you can take now to begin to address the problem.
But first let's hear from Alexandra, who works in Dubai but grew up and started her working life in England. From the moment she even starting talking about becoming a lawyer she experienced barriers that her white classmates never had to face.
So I knew growing up that as an ethnic minority in the UK I have been more likely to be treated with profession, more likely to be in poverty and less slightly to be able to pursue my true career path and that really started at school when I approached my career adviser and let him know that I wanted to pursue a career in law and he told me not to pursue a career in law because in his words as an ethnic minority and as a female from a state school and a single parent family I would struggle in such a competitive industry and then when I started my legal career as a trainee in Birmingham which is the UK's second most multi-cultural city and realised that I was again the only person of black heritage in the office at that time until the cleaners walked in. So every lawyer was white but every cleaner was black and as I progressed through my legal career I had comments like "you speak well for a black lawyer" or "I have never worked with a black lawyer before but you're actually really confident and you're quite articulate", quite as if that fact was surprising to those people. So, when we talk about racism and we talk about black lives matter we are not necessarily always talking about over racism but what we are talking about is institutional, structural and systemic racism and what we mean by systemic racism is not that there is a lot of racist people in the system; what systemic racism means is that even that where no racist people in the system, the system itself will still discriminate or make it more difficult for a certain group of people to work.
Alexandra's experience is shocking but it shouldn't be surprising. Business leaders now expressing surprise may be highlighting how great the chasm is in their organisation between the experience of black employees and the leadership of their company, says John Amaechi.
What I am hearing at the moment is a lot of people talking about how difficult it is to talk about race then talking to you about how they are unaware of the experience of black people. And I would just tell people listening here that there is a real implication for this - it is an indictment of our organisation. It is an indictment of our organisation because not having the knowledge of black people is simply a question of never having created even one relationship that is authentic enough to be granted insights. All my friends know about my life and my experience, they walk with me, they see what happens. So, it is not a question about talking about racism 24/7 but they get to absorb what my life must be like and to empathise because they build a relationship with me. Whereas right now we have got companies that are trying to solve problems with systemic racism in their organisation who are, for the first time in 18 years in the case of one individual I talked to yesterday, speaking to their black employees.
Companies that want to take action have to honestly investigate why this is happening and to do this they have to get over what for many is a large hurdle: understanding that racism is hard-wired into countless processes, policies, habits and attitudes that don't seem at first glance to be about race at all. So admitting that your organisation has an issue does not require that you admit that you employ active racists.
Still not everybody accepts that racism is institutional, inherent in society's structures and ways of operating, which is why a book like 'Why I'm No Longer Talking To White People About Race' by Reni Edo-Lodge is so important: not only in making clear what the reality is, but also in expressing the exhaustion felt by black and minority ethnic people in having to argue that this is the case to people who are disbelieving largely because their ethnicity means they haven't experienced it.
Companies that want to address this have to be bold and committed, says John Amaechi. The first step is self-examination.
I would imagine that most organisations would find out that they have no idea the number of different ways that individually benign policies, procedures ways of doing things, norms, values that type of thing, unwritten rules. they have no idea of the number of different ways they combine to create inequality. I am fairly certain that is what they find because we do cultural audits or organisational diagnostics for a lot of different companies and they find that when you do a rich ethnographic study, one that gives you proper thick data you suddenly find out that there is inequity and you find out how it is being generated. And while some of it may be because of poorly intentioned individuals, much of it is just because of the way the system is built.
So, for instance some people might have proxies for talent Many firms will only to choose candidates from one of 16 different universities in the United Kingdom, one of three in mainland China, one of two in France, you know that type of thing. By doing so, you are creating an environment only certain types of people will ever join your organisation because if you only pick from the Russell Group, you will only get - anybody who thinks they can validate the fact that the Russell Group are across the board and distinctively better than the universities than the University of Wolverhampton, you are deluded. Bright young people will go to a lot of different universities, it is a proxy, it is a lazy proxy for having actually assessed people individually. Simple things like having unstructured interviews for candidates - we know that unstructured interviews lead to more subjective choices. Not training your interviewers and your hiring managers to be objective in their assessments – all these things. There are so many simple ways that we facilitate bias in our workplace but it is not necessarily whilst it may not be evil in intent, it is not accidental. People like people who are like them. Similarity and familiarity are comforting and that is really the rub about diversity and inclusion whether that be about race or anything else, it is individual people in positions of power choosing personal comfort over organisational performance.
Stuart Affleck of diversity and inclusion consultancy Brook Graham says that giving business leaders the confidence and tools to discuss an issue they may be wary about is vital.
First of all, encouraging organisations to make sure that actually they should not be shocked that this is happening, that is the first thing because this has been going on for many years. The first act of advice that we give is to not act shocked, this has been going on and that is worth recognising. They are coming to us to equip them on how to have a conversation, giving them confidence and support and education around how to discuss race and ethnicity within the organisation but also looking at this as a longer term plan and building that plan and not to knee-jerk too quickly but to actually build a plan that is going to identify where bias may be prevalent in employee lifecycle, in policies and in practices, so you can unpick thast hardwiring that might be built in unconsciously into organisations to which is creating that inequality.
Looking at oblivious barriers in opposition to education and the workplace now is also important and increasing representation wherever possible. So whether it be on succession panning and understanding and looking at the data to understand what is a diverse representation of people that are accessing training and education might be one thing. What are the things that you can put in place that will feed the talent pools with more diverse talents specifically from the black community. It could be anything from application rates through to all the stages in the recruitment process for example of interview to offer acceptance to all the way through the pipeline but then in relation to mining that data to understand what the diversity look like in specific business units within that organisation and understanding who has that accessing in education and what the diverse mix is actually doing onto leadership programs or onto career development programmes which will basically enable that talent to progress within the organisation.
Do a cultural audit. Understand what part of your organisation are causing the challenge. There will be often benign and seemingly unrelated to race or gender or whatever it is that are causing the real problems. It will be a combination of things that individually are benign.
Set a standard, declare that your organisation will be anti-racist and not just not racist and help people understand what that means in action and in context. So not just broadly in the wide world but in our firm being anti-racist means these types of things. Show people the opportunity points where either mistakes are made, as in bias enters the equation, and also the opportunity points for shifting that. It is very boring the work that has to be done, nobody is going to pat you on the back but the reward will be intrinsic. You are going to have the best brains in place.
This education process where people are helped to identify what bias looks like and where it might happen can really help, says Alexandra, because it enables bias to be talked about openly.
The best way to challenge those unconscious biases is to make them conscious and the way that we do that is by having these conversations openly and allowing ourselves to be politely curious. Being politely curious isn't a bad thing. I remember being in our London office not too long ago and one of the white male partners said to me: what is your ethnicity? I felt so good about the fact that he had just not beaten around the bush and just asked directly, politely and curiously what is your ethnicity? And for me, that was really refreshing because you often get the question of where are you from and if I respond from Nottingham, the question will then be no, where are you really from? Of course they do not mean any offence by that but what the implication is there is that you can't be black and from Britain, you must be from somewhere else. One of the things that businesses can really do or individuals within businesses can really do is to challenge their conscious biases. Challenge their unconscious biases by talking about them, by being politely curious but by also educating yourself about where those unconscious biases came from and where they came from, and they really come from the legacy of slavery.
Part of any audit will involve interrogating the kind of ethnicity data that employers gather, and Alexandra says that this is a goldmine that can help companies identify where action is needed.
What business can do in practice is to make sure that you have networks within your organisation to address the issues and to have those conversations to find out what the issues are within the organisation. The best way you can do that is to a group of people who are fully engaged in that topic to truly do a kind of assessment and analysis of the business since and see where the gaps are. They can then go and take a deep dive into the data and data is so important on this topic because only by understanding where the business is can it really understand where it's going and by understanding the data they can put meaningful targets in place and set tangible goals.
But gathering the data is not a simple process or one untainted by the very institutional racism it is designed to fix.
If you are an organisation like many which has really poor levels of disclosure, so the 'prefer not to say' for ethnicity questions is up in the 40%, I think you then have to realise that there are white and black people who are unwilling to disclose their ethnicity and that is a statement of trust in the organisation. And that has to be dealt with the first because you cannot demand people tell you who they are if they think by telling you who they are, they put themselves at risk. It is quite an indictment if you think about it – people who prefer not to say on the survey, it is quite an indictment of the organisation if you prefer not to disclose. We already know that when it comes for example, to LGBT people, people who were out during college, tend to go back into the closet when they enter the workplace in the United Kingdon. That is a statement about what they think their workplace stands for. Even with all their pride celebrations.
The challenge is to try to build up trust in the overall aims of the programme and trust that your organisation will actually see it through, says Stuart.
To get people to disclose that type of personal information, clearly beyond the hygiene factor of being clear with your colleagues around why you're gathering it and what you are going to do with that data, what I've found often is vital building that trust in the overall programme of what you are trying to achieve as an organisation. This is going back to the authentic point: do your own colleagues and people believe that you are actually going to take action and you're going to do what you say you are going to do. In relation not just how you are going to use the data but the positive action you are going to take as a result of understanding that data.
So far we have discussed discrimination as a social problem, an issue of equity and fairness – clearly something that is important for responsible companies. But for businesses there is another element to this, which is performance. Simply put, businesses that discriminate less on race are better businesses - they make more money than those that are less diverse.
McKinsey found in 2017 that companies in the top 25%for ethnic and cultural diversity on their executive teams were 33% more likely to experience above-average profitability than companies in the bottom 25%.
There is absolutely stacks of research in relation to how race and ethnicity and the diversity of an organisation can help to build in better performance – business performance. Those stats are relatively well known in relation to how it can improve the bottom line but fundamentally it boils down to being able to attract and retain that diverse talent and that diversity of thinking, especially in the times where we are now where a lot of organisations are having to reimagine themselves as they emerge out of a lockdown as we are going in a recession or depression, that diversity of thought is even more paramount now and should be protected as an asset, rather than just seeing D&I or the lack of inclusion as a risk to mitigate. It is really an asset to protect and nurture in order to claim those sort of commercial rewards of having that diversity of thought within the organisation itself.
Researcher Joseph DiStefano found that diverse teams can perform to a much higher standard than homogenous teams, but warned that this performance boost only happened when the teams were well led.
John says that anyone looking for the best teams would be foolish to exclude a whole section of the available talent because of their ethnicity. For him this is part of an overall drive for excellence, however uncomfortable the demands of that drive are.
The beauty of well-led diverse teams is that we know that they outperform homogenous teams, but they also provide a kind of prescience for the future because the more perspectives you have, the more diverse your thinking and experience base, the less likely to be kiboshed by a new piece of information. The more likely you are to have somebody who has seen something like this before or has an experience or a background that enables them to pull that together in a way that someone without that experience may not be able to.
The performance benefits of the diverse teams are well known, they have been well known for years. Having just diverse people in a group is not what makes it work, it is having a leader who knows how to facilitate diverse teams who knows how to create space for an introvert talk in a meeting and knows how to shut up an extrovert. Who knows how to manage the microaggressions that sometimes go on. Who knows how to help people learn about each other who are very dissimilar. So there is an actual difference in role, in leadership for diverse teams. Homogenous teams don’t need that because everybody is the same and so the comfort level is instantly there. It's just that the perspective is myopic.
The goal is not to have all boards be black or any specific number, it's to have the very best brains in the very best spots. That is unlikely to be the case if you have got 10% of black employees in your early years or associate positions and then by the time they get up to the top you have got nobody. Same thing with women, same thing with everybody else.
Inclusion targets only one group. Inclusions targets the mediocre. It targets the people who have never been challenged for their position despite being nothing more than adequate and they have never been challenged because an entire group of people were filtered out at the CV stage because their name was too hard to pronounce. An entire group of people were filtered out at the interviewe stage because of the way their hair was done. Inclusion targets the mediocre and that is why I think it is key for us, looking forward to the future, to get it right. Not just so black people get dignity and human justice, so that organisations can truly have the best brains and the highest performers within them.
It is natural and right that when a company is putting together a plan of action to address this problem they will want to hear from people who have experienced racism and to be led by them. But there is a pitfall here, as Alexandra, then John, point out.
Well the first thing that could ally to do is to really try to educate themselves to understand the reasons for institutional, structural and societal racism. Because only by understanding them can we tackle our own unconscious biases. And that means not just relying on black people to educate you. Yes of course engage in conversation, but take it upon yourself to understand your own history. So it's still key to engage with black people on these topics, and that is not asking black people to teach you about it, but just asking for their experiences, being politely curious, asking people how does this black lives matter campaign and movement affect you? And what more do you think can be done about this? Not expecting that they have all the answers but making sure we are engaged in the conversation, I think, is key.
The emotional labour of solving racism shouldn't be on the people who are victims of racism, so it isn't black people who are creating racism. It isn't even in the presence of black people who are creating racism because there are entire environments that are entirely white that are rife with racism. So it is not even the trigger of a black person who is causing it.
So in organisations, you got to have a systemic approach to this, when you realise that it is the job of white people to be educated, it is the job of the systems of organisations - HR, legal and other – to make sure they are eradicating the biase that is triggered by lazy tradition-laid, under-examined processes and procedures. And that's a job for everyone, not just for black people. Black people are not libraries or librarians, they are not there in order for people to access information about blackness. They are there to do a job.
So what role is there here for legal departments in companies? Well there is the work of ensuring that the organisation is not in breach of existing discrimination laws, but John has described compliance as 'a very low bar' for companies to aim for. There is more they can do, says Stuart.
I think the legal function have an absolute critical role and can take positive actions as a team as well as individuals. We often talk about this change, this cultural change we have been talking about, as taking place at the organisational level, at a team level as well as an individual level and change needs to happen across almost those three aspects in order to drive what we would call call sustainable change and to really shift the dial when it comes to culture or the way you operate and how embedded it is in your DNA.
But the legal team can absolutely have a critical role in this across all three levels. Working with colleagues, with other leaders, with HR. I would say go beyond the provision of legal advice and compliance. But actually, GCs can often find themselves in a sponsorship role of a D&I programme or a workstream within that and if not then encourage them to take an active role in that. I think there are numerous ways at a team level and leadership level but also look at the hardwiring across the organisation, those policies and practices which often legal functions will have a hand in designing and influencing across the organisation. These are all cultural leavers as to how inclusive an organisation can be.
We have heard about the importance of educating ourselves about the problem and not using those affected by racism as our own personal library. In this phase of the Black Lives Matter campaign anti-racism campaigners are more likely than before to tell people to go and read a book before jumping into the debate. The onus is on us to learn.
To help with that we have compiled a short list of some places to start, like Brit-ish by Afua Hirsch and Whistling Vivaldi: How Stereotypes Affect Us and What We Can Do by Claude Steele. There'll be a list at the end of the podcast or you can find the details on the transcript of the podcast on Pinsentmasons.com.
We have been here before, where institutional racism or brutal treatment of black people lead to reviews which make recommendations which are largely unacted on, and we mustn't be complacent – already some voices are questioning whether we still need to be talking about race, just weeks after the killing of George Floyd.
But we can at least be a good ally, which is about being anti-racist, not just non-racist, and about speaking up. And good allyship, says Alexandra, is something that gives her hope that the future might be different.
The majority of large corporates will be disproportionately white. So, allyship is going to be really important for those businesses in order to really drive change. And good allyship is not just not being racist, it is being anti-racist. So, the question is how do you do that? How do you become anti-racist? So, really educating yourself on the reason behind institutional racism, is what a strong and good ally would do. And then not stopping there - having those conversations internally, talk to friends about this topic, talk to teams about this topic. It is only by having those conversations, by getting the message out in the open can we really champion change and all grow together in this. By having those conversations, you will be expressing your allyship so much that other people will feel comfortable having these conversations in your presence and that is really key.
I am optimistic for the younger generation because what we are finding with this Black Life Matters movement is that so many young people, teenagers, are using their initiative to go out and pick up a book, to go out and have conversation, and in some instances to go out and protest. And that really gave me hope that the next generation of people that work for businesses like ours will be a lot more open when it comes to the topic of race and ethnicity but we cannot rely on those people to make the difference, every single one of us needs to take responsibility for this and that means taking it upon ourselves to educate ourselves, to have those conversations and to look to the next generation of people to talk to our children about this and our friends and family and our clients and keep the conversation going.
Thanks for joining us for the latest Brain Food For General Counsel podcast. If you want to educate yourself about some of the issues discussed then some books that you might start with, some of them recommended by contributors to this programme, are:
Black And British by David Olusoga
Brit-ish by Afua Hirsch
Natives by Akala
Bordering Britain: Law, Race and Empire by Nadine El-Enany
Why I'm No Longer Talking To White People About Race by Reni Edo-Lodge
Whistling Vivaldi: How Stereotypes Affect Us and What We Can Do by Claude Steele
Remember you can keep up to date with hour by hour coverage of business law news by the Out-Law reporting team at Pinsentmasons.com, and don't forget to subscribe to us wherever you get your podcasts. Until next time, goodbye.
Brain Food For General Counsel was produced and presented by Matthew Magee for Pinsent Masons, the international professional services firm with law at its core.
The Apple logo, iPhone, iPod touch, and iTunes Store are trademarks of Apple Inc., registered in the U.S. and other countries.
Google Play and the Google Play logo are trademarks of Google LLC.
Head of Global Fund Registrations and Company Secretary
Planning white paper: what it means for developer contributions and costs of development