Can businesses drive social mobility?

Nick Jackson

 

Posted in: Community, Corporate Reputation, Employees, Inclusive Business, Policy & Research, Speaking Out, Strategy

Can businesses drive social mobility?

July 02, 2015

If businesses truly care about social immobility, they need to be more vocal about it, and push governments to deal with its root cause, writes Nick Jackson.

 

The level of social mobility in a society is an indicator of how fair that society is. In short, a society with a high level of social mobility will have equal opportunities for people to be rewarded for their efforts and talents, regardless of their background. A society with a low level of social mobility will mean that talent and effort will only be part of the determining factor in the rewards an individual gains: social background will either be a barrier to just reward, or a propellant to (perhaps undeserved) reward.

We have seen various news pieces demonstrating the entrenched lack of social mobility manifesting in the British education system and prestigious jobs. Research from the Sutton Trust, an educational charity focused on social mobility, found that five schools send more students to Oxford and Cambridge Universities than the bottom 2,000 schools combined (in a study of 3,167 schools). Equal Approach, a diversity and inclusion consultancy, found that 45% of FTSE100 CEOs were privately educated. More recently, the Social Mobility and Child Poverty Commission found that applicants for graduate roles at elite accountancy and legal firms were having to pass a ‘poshness test’, due to the structure of the recruitment process, that excluded talented young people with working class backgrounds from elite firms.

And it’s not just the UK – even if we are one of the worst offenders. Lack of social mobility exists in varying forms around the world. In the USA, the income gap in success factors such as college enrolment is closely tied to the race gap. In Singapore, the government has identified maintaining social mobility as a critical challenge for the growing economy.

A lack of social mobility is clearly a major issue around the world. For societies it entrenches inequality, hinders growth and innovation, reduces cohesion and crushes aspirations of those held back by it. But as long as businesses fill their ranks of employees, this shouldn’t be a problem for them, right?

Wrong. And firms increasingly acknowledge this. A range of companies have initiatives to boost accessibility and inclusivity through their approach to recruitment:

  • Credit Suisse’s Steps to Success programme supports “outstanding A-Level students in the UK who are from an underprivileged or underrepresented backgrounds” through internships, mentoring, and university tuition fee support.
  • PwC announced this year that it would stop using UCAS points (a tariff based on school performance) as a criterion for its graduate recruitment. In announcing the move, PwC said it “could drive radical changes in the social mobility and diversity of the professional services’ industry.”
  • Leading law firms Clifford Chance, Mayer Brown, and Macfarlanes are all adopting some form of CV blind application The idea being that applicants will be assessed solely on their interview performance and competencies demonstrated, mitigating the risk of biases towards certain educational backgrounds.

The list could go on. But the reasoning behind the schemes is broadly the same. Through these initiatives, companies hope to be able to broaden the pool from which their new intake of talent is taken. Opening up to a more diverse group of people is the right thing to do as a responsible employer, but makes strong business sense too. A greater diversity of talent will lead to new, different ideas that will improve the business, taking it away from the ‘groupthink’ mentality that can occur without such a diversity of experience and backgrounds.

No doubt these schemes do a significant amount of good for those who benefit from them. And collectively, they set a strong example for the rest of industry to follow. Importantly, the companies involved have recognised that their practices have in the past had the potential to be a barrier to social mobility, and that they need to take steps to stop this from being the case.

However, businesses cannot drive social mobility. The programmes above are all dealing with the symptoms of a lack of social mobility, rather than its root causes. But those are significantly deeper than the recruitment practices of firms. Primarily, it’s a government policy issue, be that policy around education, welfare, tax and many others.

So what does this mean for businesses? If businesses truly care about social immobility, they need to be more vocal about it, and push governments to deal with its root causes. Perhaps social mobility is too long-term an issue. Or perhaps it’s too political an issue for a company to be seen to be vocal about. Or, cynically, perhaps there’s just not as much value for the firm in championing social mobility as there is in other issues.

The role of the publicly engaged CEO is there for all to see. Nigel Wilson of Legal & General has taken on a range of topics relevant to the company’s long-term interests including infrastructure investment, welfare reform, and Britain’s housing situation. Paul Polman of Unilever has been a leading voice on the purpose of business beyond short-term shareholder dividend, as well as being a vocal advocate for a zero-carbon future.

But demands for CEOs to “check their privilege” may fall on deaf ears. People are notoriously reluctant to admit that their achievements might be down to anything but their own hard work.

Perhaps what we need is an against-the-odds CEO, someone who reached the top spot ahead of more privileged peers through sheer grit and determination, to step forward and champion the cause of social mobility. Unfortunately, that’s still sooner said than done.

 

Nick Jackson is a Senior Researcher at Corporate Citizenship

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