Reinforcing the business case for ethnic minority inclusion

Inclusion is, and should remain, a strategic business priority. In today’s challenging economic environment, this is more important than ever. In recent years, many organisations have focused on the business case for widening talent pools to support growth and address recruitment challenges. While that remains important, the commercial case for inclusion is much broader and requires restating.

Our position paper sets out why ethnic minority inclusion continues to be a strategic commercial priority. With changing demographic shifts, consumer behaviour, and employee expectations, getting inclusion right is paramount.

This paper sets out the commercial benefits of action, synthesising existing literature and evidence to illustrate that under-representation of ethnic minority talent in UK corporate leadership is both an economic loss and a strategic risk. As such, the paper sets out the following key messages:

1. Under-representation is an economic loss. Fully utilising ethnic minority talent could add £24 billion (1.3% of GDP) to the UK economy annually (McGregor Smith Review, 2017). 
   
   
2. The UK's demographic shift makes this commercially urgent. Nearly one in five working-age adults is from an ethnic minority background today, rising to one in three by 2051 (ONS, 2023). Businesses that fail to reflect this in their leadership risk losing both talent and market competitiveness.
   
   
3. Ethnic minorities are increasingly important consumers. By 2061, Ethnic Minority Groups’ disposable income (expressed in 2022 prices) will rise to £575 billion annually (WPP, 2022).
   
   
4. Inclusion drives engagement. Engaged employees deliver 23% higher profitability and 51% lower staff turnover (Gallup, 2024). Poor inclusion practices cause ethnic minority employees to disengage, opt out of promotion, and leave, creating costly holes in organisational succession plans. 
   
   
5. Retreating from EDI initiatives can carry risks. Both consumers and employees are increasingly expectant of organisations to take EDI values seriously and are less likely to align with those who do not (BCG, 2023).

We hope members can find this paper useful in offering a robust case for why taking action on race inclusion is a strategic priority and supports leaders to achieve their objectives. 

For any questions, please contact Yusuf Ali-Hassan.