A KEY diversity focus in 2021 is ethnicity in the workplace. Employers of varying sizes and from diverse sectors are considering what steps they can take to promote an anti-racist message and improve equality of opportunity for ethnic minority groups.

Race discrimination legislation has been around for years, so what has changed? Undoubtedly the BLM Movement of 2020 has been a major catalyst. This, together with the UK Government’s plans to introduce ethnicity pay gap reporting, has definitely resulted in increased activity in this area.

We are now seeing an increasing number of employers choose to report their ethnicity pay gap on a voluntary basis before any mandatory requirements are introduced. This move is a huge step in the right direction. Carrying out this exercise is a crucial first step for employers in this area.

One of the first challenges employers face is capturing their ethnicity data. Many report a reluctance on the part of employees to provide this. To try to maximise the level of participation, employers need to make sure they explain clearly why they are collecting the data and how it will be used. They need employees to trust their motivations. A “cold” one-off email setting this out is unlikely to do the trick and employers need to think about how to ensure their approach is credible and authentic. Employers also need to take care in terms of how they collect and use the ethnicity data to ensure compliance with their data protection obligations.

Once an employer has the results, these often lead to difficult questions about the breakdown and composition of the ethnic diversity of a workforce. Why are there so few senior managers from an ethnically diverse background? What can we do to improve this? As we know from gender pay gap reporting, there are no quick and easy answers but understanding the scope of any problem is the first step. It can be uncomfortable reading but we need to see the results as a starting point for that employer to build from and not an indictment on the employer.

Building on this, we are seeing an increasing number of employers considering setting targets around ethnic diversity. A key question from employers is how to do this in a meaningful way that is at once realistic and stretching. It is a very fact-specific exercise for every employer. In addition, well-intentioned employers must take heed of the legal restrictions in this area and not go further than UK law permits. Targets should remain “aspirational” and not constitute quotas.

We are also seeing real momentum in this space at board level. The structural inequalities faced by ethnic minorities in the UK were highlighted in detail in the 2017 McGregor-Smith review into Race at Work and the 2017 Parker Review looking at ethnic diversity in UK boards. The Parker Review, amongst other things, recommended that FTSE-100 boards should have one ethnic minority board member by 2021. At the review stage last year, 37% of companies had not met the target and it is clear that more work needs to be done at board level. Change at a senior level is key to substantive and sustained progress in this area. Perhaps, however, this will be given a further nudge in the right direction from two corporate sources: corporate governance rules and the power of institutional investors, both of which are turning their gaze to the lack of ethnic minority representation at senior levels.

In the UK, we don’t like to talk about race or ethnicity. It makes us uncomfortable. But employers no longer have a choice. The direction of travel in this area is clear and it points towards the need for all employers to act, not simply with bold corporate statements but with tangible, practical actions.

Gillian MacLellan is a partner at international law firm CMS