The Investment Association has been called out for a lack of ethnic diversity on its board, after itself urging some of the UK’s largest companies to “reflect the diversity of modern-day Britain”.
The UK’s fund management lobby group said on 24 February that it will turn up the heat on companies in the coming months over ethnic diversity, with plans to issue warnings to those that fail to make progress.
However, Chuka Umunna, who is leaving his current role overseeing Edelman’s European ESG operations to join JPMorgan, pointed out on Twitter that the IA’s 17-strong board has nobody from an ethnically diverse background.
He said: “It might be an idea to do something about that if making similar demands of companies.”
A spokesperson for the IA said: “The guidelines we’ve put out apply to listed FTSE 350 companies, however, we know while calling for greater ethnic diversity in these companies, we must also look at our own board composition.
“That’s why, as signatories of the Change the Race Ratio initiative, we’ve committed to appointing at least one racially and ethnically diverse Board member by 2024.”
Umunna’s comments were first reported by The Times.
Earlier this week the IA, which represents Britain’s £8.5tn asset management sector, said it will issue “amber top” warnings for companies that fall short on ethnic diversity.
The labels are issued by the lobby group’s Institutional Voting Information Service, a tool that investors can consult ahead of annual general meetings. Amber tops are issued where there are significant issues that need to be considered.
The IA said it will target FTSE 350 companies that fail to disclose the ethnic diversity of their boards or a credible plan to progress towards having at least one director from an ethnic minority background.
The targets are based on the Parker Review, published in 2017, which set out expectations of the number of directors that companies should have from ethnic minority backgrounds.
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