Diversity Forum Response to BSC Portfolio Diversity Audit

This blog is in reference to the BSC Diversity Audit, for more information please click here.

December saw the welcome release of important diversity data from Big Society Capital’s (BSC) portfolio of fund managers. In this release of data, gathered from 25 fund managers within BSC’s portfolio, we saw a great first step by BSC to gather such vital data and highlights the need for further resource, capacity and investment in consistent and standardised diversity data collection across the sector regularly. Furthermore, we recognise that due to the small sample size and due to several of the fund managers providing the data being outside of the conventional social investment market it would be challenging to draw any conclusions.

That said here at the Diversity Forum we do believe that the data conveys a lack of diversity – particularly across race, disability, gender, and age, particularly in the senior leadership of the sector. This further reinforces the view that we have held that the pace towards change within the sector is still glacial and whilst the rhetoric of change has amplified over recent times the path towards meaningful tangible change has not been mirrored. The data release also highlighted several characteristics that were not able to be collected including sexuality and socioeconomic background, further emphasising the need to think more about not only the ‘how’ but ‘what’ when it comes to data collection. At the Diversity Forum, we believe this is indicative of a need for not just a focus on diversity but more so on systemic cultural change to fully embrace, empower and include people from marginalised backgrounds in the sector.

“Like many social investors, UnLtd is working to put equity and inclusion at the heart of our work. We have a long way to go – we recently published our one year on Equity Report about learning, progress and mistakes – but we are committed to make substantial change.

This Big Society Capital data highlights just how far we as a whole sector still have to go – it’s horrific that we are still so biased towards white male privilege. I’d hoped we’d come further by 2022.

This is a real clarion call for all social investors to put in place bold plans for dramatic cultural and structural changes in our organisations - in our governance and our leadership – in 2023. There is no reason to delay - the sector needs to work together urgently to systematically redress who is holding all the power and wealth.”

Mark Norbury, CEO, UnLtd

We launched our new Diversity Forum Manifesto this year to encourage this kind of transformational change-making by contextualising individual equity, diversity and inclusion (EDI) goals such as reviewing recruitment processes or recruiting an EDI consultant, within an organisational approach that involves every individual in an organisation committing to and implementing EDI as part of their work and their ethos when working. This involves collaboration with diverse-led organisations, creating space for difficult conversations, taking risks, being courageous enough to make mistakes and own them and embracing uncertainty through transparency and sharing. We are grateful for the 19 organisations that have signed up for the new Manifesto. At the same time, we are still disappointed that this number falls well short of the overall number of impact funds and social investors that are currently active in the UK social investment market and would urge those that have not signed yet to reach out.

“Social Investment Business hosts the Diversity Forum because we believe in using finance and support for a more equal society. This release from Big Society Capital demonstrates not only the importance of high quality and transparent data – but also that data needs to prompt clear action if things are to change. The pace of that change needs to accelerate rapidly – inside our own organisations, and in the distribution and diversity of those organisations receiving social investment.”

Nick Temple, Diversity Forum Steering Group Member & CEO , Social Investment Business

As a Manifesto signatory, BSC has implemented these principles in practice by conducting this audit, publishing its findings, and sharing this transparently with the rest of the sector. We would also like to recognise and encourage the efforts to build EDI considerations across its investment strategy, process, portfolio management and reporting, for which it has benefitted from the support and expertise of the Equality Impact Investing Project (EIIP). Our hope, as the Diversity Forum, is for other organisations to follow and be inspired by their lead in also sharing data transparently so that we might work together to make the changes required collectively to improve diversity, equity and inclusion in social investment. We aim to continue our role in working with fellow EDI initiatives such as EIIP to support this progress and by working directly with BSC and other social impact investors to make EDI more integral to your work and ensure the prioritisation and commitment to sufficient resource and capacity from social investment organisations needed to make the changes we would like to see.

“Big Society Capital’s portfolio audit shows that the social impact investment sector is just at the beginning of an overdue shift towards centring equity and fairness. We need to appreciate the depth of transformation the sector is embarking on, and be prepared to fully engage in a long-term process of change.”

Rana Zincir Celal, Director, Equality Impact Investing Project (EIIP)

The move towards action has never been more important and there are now plenty of resources, initiatives, and networks for social investors to plug into as well as also working with peers collaboratively. At the Diversity Forum, we intend to ramp up our work next year to move from rhetoric to action and would continue to urge the sector to engage with us on this and talk to us about how we can help support you in this work.