The new PM must introduce mandatory ethnicity pay gap reporting, BITC urges
Business in the Community (BITC), The Prince’s Responsible Business Network, has today called on Conservative Party Leadership candidates to ensure that under the leadership of the new Prime Minister, mandatory ethnicity pay gap reporting is introduced by April 2023. Earlier this year, the Women and Equalities Select Committee supported the introduction of mandatory reporting by April 2023.
Business leaders have been campaigning for mandatory reporting, with 30 leaders from companies such as KPMG and Shell signing an open letter to the Government in 2020. The reasons why ethnicity pay gap reporting should made mandatory include:
- There has been an increase of 8% of employers capturing ethnicity pay gap data, increasing from 11% in 2018 to 19% in 2021.
- It could take until 2075 for companies who currently capture their ethnicity pay gap data to publish their pay gap unless the Government takes action. [1]
- If current trends continue, analysis shows that it will take five years, until 2027, for 66% of companies to have an executive sponsor for race increasing to 77% in 2030, 88% in 2033 and 99% in 2036.
While the Government is working on guidance to support companies to capture their ethnicity pay gaps, BITC and its members want to see the publication of ethnicity pay gap data made mandatory.
Sandra Kerr CBE, Race Director at Business in the Community, said,
“The case for introducing mandatory ethnicity pay gap reporting has been made by business leaders time, and time again, but the Government has been dragging its feet in bringing forward the relevant legislation to make this a legal requirement. With the current cost of living crisis, this brings another reason to the surface as to why mandatory reporting is needed. Mandatory reporting should be introduced by April 2023, at the latest, as it plays a vital role in ensuring that the UK has a truly inclusive economy that benefits people from all ethnicities and social backgrounds.
“I have always been clear that while reporting won’t solve everything, it will help businesses focus on where action is needed most. I hope the new Prime Minister understands that businesses want reporting to be made mandatory as they see it as a tool rather than a burden. Business leaders have been clear, and they are ready, so the ball is now firmly in the Government’s court.”
Ends
Notes to editor
- Full details of the analysis are available upon request.
- Read the Race At Work 2021: The Scorecard Report.
- Read more about the Race at Work Charter.
For further information, please contact Aoife Butler Nolan, Head of Media, Public Affairs and Policy on 07702 903 216.
About Business in the Community
Business in the Community (BITC) and our network of business members are leading a movement to create a fair and sustainable world in which to live in work. Formed in 1982, and with HRH The Prince of Wales as our Royal Founding Patron, we are the largest and longest-established membership organisation dedicated to responsible business. We work and campaign with more than 600 members to continually grow their responsible business practices, uniting our efforts for greater social and environmental impact in our communities.