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Diversity and inclusion in the workforce are the core environmental, social and governance (ESG) themes that financial professionals are increasingly incorporating in their investment strategies and capital allocation decisions.
In a report titled “Key Factors Driving Diverse and Inclusive Workplaces", global data provider Refinitiv said that globally the cultural diversity of board members has increased from five years ago but has stalled at around 30 percent.
“Europe, the Middle East and Africa (EMEA) leads the way with the most culturally diverse boards, [but] at the other end of the spectrum, we see that Asia–Pacific company boards are becoming less culturally diverse,” the report noted.
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The Refinitiv report aims to raise awareness on the topic of diversity and inclusion (D&I), analyze data to assess progress made and examine its direct impact on corporate financial performance.
“In today’s volatile business reality, diversity and inclusion is more important than ever. Yet measurable progress in increasing workplace diversity and inclusion remains stagnant. The reasons why are as varied as the potential solutions. However, most can agree that diversity is good for business,” Elena Philipova, Head of ESG Proposition at Refinitiv, said in the report.
Industry breakdown
In terms of industry trends, the energy industry is leading the way on board cultural diversity and has seen the most improvement over five years. Although the financial services industry has seen a large improvement from five years ago, the industry is lower than average in terms of culturally diverse boards.
According to Refinitiv healthcare companies are overrepresented in terms of diverse boards, while basic materials and utilities are underrepresented.
It’s also interesting to note that, at the country level, Canada is leading the way in terms of culturally diverse boards, with 18 percent of companies in the top decile headquartered in the country.
To find out more about D&I trends and financial performance and to get insights into the Refinitiv D&I Index, you can download the report for free here.
(Reporting by Seban Scaria; editing by Daniel Luiz)
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