Diverse businesses are more profitable, innovative and competitive, says Lord Bilimoria

NO company can afford to let diversity and inclusion slip down the priority list in these uncertain times, Confederation of British Industry (CBI) president Lord Karan Bilimoria CBE said on Tuesday(1).

He added that diverse businesses are more profitable, innovative, and competitive.

While speaking at CBI’s first virtual diversity and inclusion conference, Lord Bilimoria has urged firms to join Change the Race Ratio, a CBI-led campaign to accelerate racial and ethnic participation at the top of UK companies.

Announcing new 20 signatories, including Sainsbury’s, Pennon, Halma, Costain and Centrica, the CBI president revealed that a total of 55 organisations have now signed up since the campaign launched last month.

“I’m incredibly proud, and humbled, by the huge momentum we’ve seen so far. We ask businesses to consider board representation, diverse senior leadership, transparency in disclosing pay gaps and building an inclusive culture," Lord Bilimoria said.

"They are practical and entirely achievable. They could make business more innovative, more profitable, more attractive to talent. And help make society fairer for everyone.”

Currently, 37 per cent of top 100 companies and 69 per cent of the top 250 companies in the UK don’t have a single ethnic minority director on their board.

Lord Bilimoria pointed out that lack of ethnic diversity in business is costing the UK £24 billion a year in lost GDP.

"Firms with the lowest gender and ethnic diversity in their executive teams are 27 per cent less likely to be profitable. In the case of ethnic and cultural diversity, we know top-quartile companies outperform those in the bottom quartile by 36 per cent in profitability. And when employees feel included in the workplace their ability to innovate increases by 83 per cent," he said.

“Diversity works. It’s not just the right thing to do – it’s good business. And in an environment so uncertain, so hard-hit by Covid and preparing for a new trading relationship with the EU, no business can afford to miss out.”