Diversity in Food and Grocery - MBS Intelligence - The MBS Group
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MBS Intelligence
Diversity in
Food and Grocery
2019 Edition: An in-depth report from
The MBS Group, IGD and in association with PwC
IN
ASSOCIATION
WITH
Contents Forewords 4 Susan Barratt – CEO, IGD 5 Jon Terry – People and Organisation Consulting Partner, PwC UK 6 Elliott Goldstein – Managing Partner, The MBS Group 7 Executive Summary 8 Ten Steps for a more diverse and inclusive workplace 10 Research findings 13 Purpose and methodology 14 Do we have the right diversity and inclusion strategies? 15 Gender 18 Ethnicity 22 LGBTQ 25 Disability 26 Age 28 Social mobility 29 Nationality 31 Benchmarking within the industry 32 Hiring for diversity 34 Putting D&I strategy into context 37 Diversity and inclusion in the grocery sector 38 Conclusion: Are you on track? 45 Views from the industry 47 Ash Amirahmadi – Arla Foods UK 48 Leendert den Hollander – Coca Cola European Partners 50 Catherine Gillespie – Coca Cola European Partners 50 Oliver Morton – Kellogg Company 52 Samantha Thomas-Berry – Kellogg Company 52 Sumaira Latif – Procter and Gamble 54 Clodagh Moriarty – Sainsbury’s 56 Simon Roberts – Sainsbury’s 57 Natasha Adams – Tesco 58 Alessandra Bellini – Tesco 58 Rachel Baldwin – Tulip 60 Rita Greenwood – William Grant & Sons 62 Existing initiatives in the sector 64 Further reading 65 About us 66
4 5
Forewords T
he business case for diversity and inclusion has never
been clearer. Studies have shown that more diverse and
inclusive workplaces have a higher level of employee
engagement, are more productive and are more profitable.
I’m therefore delighted that IGD has been IGD will continue to champion this
working with MBS and PwC to understand important topic and make sure it stays high
how the food and consumer goods industry on our industry’s agenda. We will take every
performs on this vital topic. opportunity to share best practice through
our research, events and industry groups. We
The response and interest in this project would love to hear from you if you would like
from across our industry has been fantastic; to get involved, so please do get in touch.
there’s no doubt much is happening
at an individual business level as well
as collaboratively. However, this research IGD supports diversity and social mobility
also clearly demonstrates there is a need through its charitable initiatives, research
– and an appetite – to do a lot more. and commercial events, including:
Gender equality is a good starting point • Lifelong learning resources for
for any business embarking on its diversity everyone working in our industry
and inclusion journey. The progress that has
been made in this area and the wide range • A nationwide schools programme
of initiatives already in place to nurture to help young people prepare for
female talent is particularly encouraging. the world of work and understand
the wide range of careers available
But there are other levers of diversity beyond in our industry
gender that can also help to create a diverse
workforce – age, ethnicity, LGBTQ, social • This free research, published in
mobility and disability, amongst others. partnership with MBS and PwC,
The research shows there is much more to help companies benchmark
to do in these areas, to help businesses themselves on diversity and inclusion
unlock new sources of talent for the future.
• The IGD Award for Diversity &
As well as data to help you benchmark Inclusion, recognising employers who
your own business, this report includes have developed initiatives to support
inspirational case studies from Arla Foods, a highly inclusive working environment
Coca Cola European Partners, The Kellogg
Company, Procter & Gamble, Sainsbury’s,
Tesco, Tulip and William Grant & Sons. I hope
they will encourage you to take diversity and
inclusion forward.
Susan Barratt
Chief Executive Officer, IGD
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FOREWORDS
6 7
W F
e’re delighted to have been working with IGD and or over 30 years, The MBS Group has been championing
MBS on assessing progress on diversity and inclusion diversity in the food and grocery sector globally. Creating diverse
within the food and grocery industry and gauging how leadership teams is not only right morally – but, particularly in our
businesses across the sector can move forward. sectors, diversity is a commercial imperative. Simply, the leadership
of consumer businesses need to reflect the wider population we
There’s always been a compelling moral case How then can your business capitalise on
for diversity and inclusion – why should the the diversity dividend? High-level policies serve – being representative of all decision makers in the consumer
chance to succeed be confined to a favoured and isolated initiatives are useful, but can purchasing journey.
few? There’s also an equally compelling only go so far in moving the dial. What’s
business case – from broadening market clear from businesses that are making the It is therefore a pleasure to partner with both There are too many people for me to
reach to bringing fresh perspectives to strongest progress on diversity real impetus PwC and the IGD to create this report – the thank individually, however, I would like
strategic planning, the power of diversity and is that this requires the same board-level first of its kind exploring the true state of to single out Jon Terry at PwC for his
inclusion is something I see right across my direction, organisation-wide push and regular diversity, in all its characteristics, across the ongoing partnership and support – and
work with colleagues and clients. reporting, intervention and incentives that entire food and grocery sector. We have huge Andy Higginson (President of the IGD) and
would be applied to any other strategic respect and admiration for both PwC and the Susan Barratt (CEO of the IGD) for ensuring
And while the case for diversity and priority. In short, diversity and inclusion are IGD – and the leadership they are showing diversity is top of the agenda for the entire
inclusion is strong in all business sectors, part of the organisational strategy and its in promoting more diverse and inclusive food and grocery industry. I am also indebted
it’s especially so in an industry like food and cultural DNA. businesses – and we would be honoured if to our Steering Group (Stewart Gilliland,
grocery, where the customer reigns supreme. our research complements and adds to their Jo Whitfield, Johanna Dickinson and Anne
Amidst tightening margins and intensifying I hope the research and recommendations existing leadership in this area. Bordier) for guiding and directing this work.
competition, diversity and inclusion can help provide useful insights into how to move Lastly, I would like to thank my entire team
businesses to get closer to customers, tap the dial on diversity and inclusion within Grocery and food is very much a data led at MBS – but in particular, Huw Llewellyn-
into underserved markets and keep one step your business. If there are any aspects of the sector – and it is our hope and belief that Waters (the Director of our Global Consumer
ahead of fast-shifting consumer demand. research you would like to discuss further, by providing our sector with a snapshot Practice) and Simon More – for going above
please feel free to get in touch. of diversity today, the findings will enable and beyond leading the research and
So, where is the food and grocery industry organisations to benchmark themselves development of this project.
now on diversity and inclusion? If we look at against their peer group, and adjacent
the gender pay gap, an important indicator sectors / industries – and to act as a catalyst The MBS Group will continue to be
of progress, grocery scores much better than to change and development. an advocate of diversity and inclusion
the UK economy as a whole. This reflects the and I hope this report plays at least some
important strides made in recent years. But Additionally, we are proud that this report small part in continuing to drive positive
the industry can’t afford to be complacent. looks beyond the data to explore some change across our sectors.
Our survey of industry groups shows that ‘best practice’ of what companies are doing
most still lag other sectors on key lead to drive diversity and inclusion in their
indicators of progress including leadership businesses. Undoubtedly there are some
focus, alignment with business strategy phenomenal initiatives, across a multitude
and tracking against targets. The findings of businesses – and their work and
also suggest that diversity and inclusion is Jon Terry achievements need to be showcased widely.
still seen as nice-to-haves in some grocery People and Organisation Consulting Partner
PwC UK The food and grocery industry can be proud
businesses rather than key priorities such
of the progress it has made to date changing
as customer preferences and satisfaction.
the dial in diversity – but it is clear from this
report that there is still some way for us
all to go.
Elliott Goldstein
Managing Partner
The MBS Group
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FOREWORDS
8 9
Executive Summary
Looking behind these headline figures, ethnic old. This is slightly below the average across
diversity varies considerably across individual the FTSE 350 of 60 years old, while at 54, the
companies; almost half of the companies we average age of Executive Committee members
surveyed have zero BAME Direct Reports is in line with the FTSE 350.
T
to the Executive Committee, whilst at the
his report is the first of its kind in the food and grocery industry. other extreme, one company had 80% BAME Nearly 70% of interviewees believe that food
leadership at the Executive Committee level. and grocery is one of the best industries for
Drawing on data captured from over 200 companies, and promoting social mobility, while two-thirds of
In part, this reflects the varying levels of ethnic
conversations with more than 100 Chairs, CEOs and Human diversity in the UK at a regional level. Most companies reported that they are taking active
Resources Directors, it aims to paint a true picture of diversity and companies do not collect complete data steps to encourage it. Measuring success is
difficult, though, as there is not only a lack of
inclusion in the industry and to highlight examples of practices being around ethnic diversity.
data in most companies but there is also a lack
implemented to achieve greater diversity. When asked to consider their wider senior of clarity around how to define social mobility
leadership teams, 27% of interviewees were and what indicators individual companies can
Of those interviewed, 84% felt that their On gender, an average of 27.6% of Board able to identify an openly LGTBQ leader realistically assess progress against.
company is performing better today than they roles are occupied by women. At Executive within their business. 15% were able to identify
were five years ago on diversity and inclusion; Committee level this drops to 22.2%, while someone with a physical disability, though no Nationality is an often-overlooked aspect of
however, less than half of companies have a 35.9% of Direct Reports (into the Executive one was identified at the Executive Committee diversity, though – as evidenced by our research
coordinated D&I strategy or approach. An Committee) are women. Compared with the level, despite 19% of the working age – it is sometimes confused with ethnicity.
understanding of the importance of diversity latest Hampton-Alexander Review figures, food population having a disability. In the context of a looming labour shortage
and inclusion, as well as a genuine desire to do and grocery is ahead of the FTSE 350 cross- and the UK’s changing relationship with the
more, are in strong supply across the industry industry average at the Executive Committee As most companies do not collect data on EU, this could be a useful lever for improving
– however, this is sometimes coupled with a and Direct Reports levels, though our sector is LGBTQ and disability, it is difficult to measure productivity. Across a sample of 50 companies
slight reluctance to talk openly about it for fear unlikely to reach the Hampton-Alexander target how accurately the food and grocery industry across the food and grocery industry, 82% of
of being seen to be ‘behind the curve’. of 33% women by the end of 2020. workforce reflects wider society. The most Executive Committee members are British.
common approach to the LGBTQ agenda is This compares with an average of 73% across
to focus on promoting an inclusive working the FTSE 350. Of the remaining Executive
WOMEN IN LEADERSHIP ROLES
environment, often by working with external Committee members, there is a strong bias
Level FTSE 100 FTSE 250 FTSE 350 Food & Grocery not-for-profit organisations. The approach to towards EU nationals (13% versus 5% of
physical disability tends to be more reactive nationals of non-EU countries).
Board 32.4% 29.6% 30.6% 27.6% than proactive – particularly in dealing with
injuries sustained in the more physical parts of At Board level, 64% of roles are occupied by
the industry. However, relatively little is known British nationals within the industry (compared
Executive Committee 23.1% 18.6% 19.9% 22.2%
about how effective the industry is at attracting with 68% across the FTSE 350) and the split of
candidates with a disability – especially EU and non-EU nationals is much more evenly
Direct Reports 29.3% 27.9% 28.3% 35.9%
given UK government figures showing a 30% weighted (19% and 17% respectively).
employment gap between disabled people Through PwC’s detailed maturity assessment
Gender representation varies widely by and Chair is very low – all falling below 10%.
and the working population at large. survey covering diversity and inclusion strategy,
function: whereas, in our sample, 9% of the
most senior functional head of manufacturing At 11.4%, the percentage of Board members leadership and the tone from the top, HR
With a backdrop of an ageing population,
or operations are women, the split is close to in the food and grocery industry from a BAME policies and processes, and other diversity and
the workforces of companies in the food
50/50 in marketing while over 70% of the most background is very close to reflecting the UK inclusion initiatives, this report also considers
and grocery industry are changing. It is
senior HR roles are held by women. Consistent working age population at large (12.5%). 5.7% how the food and grocery industry’s approach
now common for businesses to have three
with all industries, the number of women in of Executive Committee members and 7.1% of compares with other industries.
generations within the same teams, while
the most senior company roles of CEO, CFO Direct Reports are BAME.
constantly evolving advances in digital and Analysis by PwC shows that the median gender
technology are resulting in companies looking pay gap within the food and grocery industry
BAME REPRESENTATION to new talent pools and reskilling existing is lower than the UK economy as a whole
employees to meet the challenge. At the (6.8% versus 9.6%); however, fewer than 10% of
Board Executive Committee Direct Reports leadership level, across a sample of more companies surveyed are prepared for ethnicity
than 50 companies, the average age of Board pay gap reporting if it is introduced in the
11.4% 5.7% 7.1% members in food and grocery is 57 years coming years.
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EXECUTIVE SUMMARY
10 11
Ten steps for a more diverse
and inclusive workplace
W
e’ve developed this simple checklist of common themes 5. Foster an inclusive culture and mindset 8. Share success stories
and learnings from our research and conversations with • Create an environment where everyone can • Identify and showcase positive role models
be at their best – simple changes such as – they are a great way to bring diversity and
companies – we hope it will help you identify practical a more relaxed dress code or more radical inclusion to life in your organisation and
steps you can take to move diversity and inclusion forward ones such as an office move can have inspire emerging talent
in your own business. a big impact
• Celebrate success and progress – your
1. Define what diversity and inclusion 3. Lead from the top • Empower your internal champions – own internal communication channels are a
means for your organisation employee focus groups, internal networks great way to do this or you could consider
• Approach diversity and inclusion like a
and reverse mentoring schemes were entering an industry award
• Be clear why it’s important to you – for change programme – you are more likely to
often mentioned as powerful mechanics
example: responding to skills shortages; make sustained progress if it is a priority for 9. Learn from others
to drive change
addressing a gender pay gap; better your entire leadership team, not just HR • Learn from companies that are prepared
reflecting your customer base 6. Educate and support your line managers to share their stories – the in-depth case
• Create ownership – appoint a leader
• Think about the levers of diversity you can with a clear mandate and the authority to • Equip your line managers to support their studies in this report provide a starting
pull – gender is often a good place to start, champion diversity and inclusion. If you teams and take action – they need to be point; you can also share experience with
but ethnicity, social mobility or age may be cannot afford to create a dedicated role, prepared to model the right behaviours, your peers
more relevant to you this could be a development opportunity spot issues and face into sometimes difficult
conversations • Make the most of the wide range of
for one of your rising talent business networks available in our industry
• Articulate what success will look like –
you may want to do this for the whole • Develop and embed inclusive leadership • Consider providing training on ‘unconscious – we’ve provided some suggestions at the
organisation and/or specific business – this may require a specific intervention bias’ – this is a practical step that many end of the report
functions to build a common understanding and set companies have found to have a significant
impact and help shift behaviours 10. Keep diversity and inclusion high
of behaviours among your senior leaders; on your organisation’s agenda
2. Identify your strengths and priorities the more advanced companies have set
for improvement 7. Identify and prioritise interventions • Taking a long-term test and learn approach
performance metrics relating to inclusion
• Be forensic and honest – most of the • These can be company-wide programmes is often quoted by the more advanced
companies we talked to recognised this 4. Set targets and measure progress or a toolkit of targeted interventions that companies as a key to success
is a new area of management with a lot • This was a common theme in our research line managers and employees can access
of work to do with a strong consensus that ‘what gets (such as coaching and mentoring)
measured gets done’ • Examples of interventions mentioned in
• Use this report to help you – you can use
the PwC model to frame your thinking, • Communication of progress and our research include: strong discrimination
the benchmarking data to compare your transparency are also key policies, new recruitment practices,
own performance or read the in-depth progression programmes, strengthened
case studies for practical inspiration employer branding and communication,
flexible working and support for parents
and carers, benefit packages, physical
changes to the equipment and office
environment and agile working practices
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TEN STEPS FOR A MORE DIVERSE AND INCLUSIVE WORKPLACE
13
Research
findings
RESEARCH FINDINGS
14 15
Purpose and methodology Do we have the right diversity
and inclusion strategies?
W
ith the understanding that ‘what gets measured gets
done’, in this report we have set out to understand
the status of diversity and inclusion within the UK COMPANIES WHO HAVE A COORDINATED
DIVERSITY AND INCLUSION STRATEGY
rather than organisationally-specific. Whilst
there was also a general acceptance that
food and grocery industry. gender pay gap reporting has shone
There are several initiatives and networks In order to retain our focus on the UK a spotlight on gender diversity, so far it
already working hard to improve diversity, industry, for international businesses we appears to have had more success raising
both within and beyond the industry, but this have looked at the most senior leadership awareness than it has in providing solutions.
is the first research of its kind to consider how team operating in the UK. So, for a global One respondent commented:
the food and grocery industry specifically business headquartered in the UK, it will be I’m conscious that we still use quite old
– and in its entirety – is performing in the the group leadership; for a global business language about equal opportunities
45% Yes
UK. Our research is not intended to be headquartered outside the UK, we might policies and so on. The new legislation
judgemental, nor is it designed to distract have looked at the UK or EMEA leadership 55% No
has forced us to get under the numbers
from those existing initiatives. Instead, our team, for example, whichever is the most and understand the composition of the
intention is to set out an honest view of senior team operating here. workforce better, though.
‘where we are’, as well as extolling examples Just less than half of companies interviewed
of best practice for organisations across the 2. To get under the skin of the challenges as part of our research self-report that they There was a clear narrative running through
industry – of which there are many. affecting the industry, and what it is doing have a coordinated diversity and inclusion several of the interviews that, despite
to respond to them, The MBS Group strategy, plan or approach in place. While this admitting that there were gender imbalances
To represent the industry as fully as possible, conducted in-depth interviews with more headline figure demonstrates that there is a through the industry, some struggled to
our research has spanned companies than 100 CEOs, Chairs and HR Directors. long way to go, there is certainly a genuine understand the need for a coordinated D&I
operating at scale across all sub-sectors level of engagement in the topic. Almost strategy. Instead there is often a focus on
in the UK – from grocery retail through In this chapter, we analyse how the universally, the importance – and benefits –
industry is tackling diversity and inclusion individual policies such as taking a zero-
to FMCG and manufacturing, and from of diversity were well recognised across the tolerance approach to discrimination or,
wholesale through to logistics – and has at the strategic level, as well as how it is industry, and it is met with genuine intent
performing in seven key areas of diversity: for example, reactively widening doorways
centred around two key pillars. to do more. to accommodate wheelchairs. This was
gender, ethnicity, LGBTQ, disability, age,
1. Over the past few months, The MBS nationality and social mobility. Disappointingly, a small group of companies applicable even to some of those that
Group has captured data on and profiled were unwilling to engage with this research, claimed to have a D&I strategy.
the leadership teams of the 200 largest instead pointing us towards vague Though we always had policies in place,
companies across our industry. Specifically, statements on their company websites or in they had more of a reactive approach.
we have concentrated on the three highest annual reports, but in the main we detected Bullying, harassment and opportunities
leadership levels: a real appetite to grapple with the challenges were taken seriously. But when we looked
and opportunities of diversity and inclusion. for proactive steps to promote D&I, there
– Boards (excluding Executive Directors),
where applicable As a starting point, many of those interviewed was no depth and certainly no strategy.
commented on the widespread gender This was a recurring theme, with many stating
– Executive Committees imbalances within the food and grocery that their ‘strategy’ is often limited to taking
sector, with several making reference to the a reactive approach, preferring to tackle ‘bad
– Direct Reports (in other words,
impact these had on equal pay. Across the behaviour’ rather than think proactively about
all those who report into
board, the barriers to success on D&I were the strategic impact D&I might have on
the Executive Committee,
considered to be industry-wide problems, overall organisational performance.
excluding administrative staff)
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RESEARCH FINDINGS
16 17
On the other hand, companies that are more saying the wrong thing – perhaps due to a and if they had personal stories to share BENCHMARKING WITHIN THE INDUSTRY
advanced on D&I are working hard to ensure widespread fear of appearing ‘behind the across the business. In under a week,
20‑25 people signed up and released Most promisingly, 100% of all retail
that it is baked into wider business goals, curve’. It was apparent in our conversations
media about themselves, their family businesses we interviewed have a specific
such as embedding it into the company’s that not being able to openly talk about
or their parents. They felt open enough D&I strategy in place. We found that bigger
overall strategy or values – therefore ensuring diversity is holding some companies back.
to talk about their personal life and businesses, and those publicly owned, are
it is part of the metrics leaders are measured
If you were to ask my CEO if there have challenges in a genuine, transparent way. more likely to have a D&I strategy than
against and incentivised on throughout the
been any significant changes [on D&I] smaller businesses or those private equity
organisation.
over the past two years, they would say An important element of any strategy is backed. In terms of product, food companies
Role modelling is a well-recognised tool ‘no’ – because to say yes would imply how results are measured and reported. significantly outperform those in the drinks
for improving diversity and it was striking in we were in the wrong before. Although many of the organisations surveyed category.
our interviews that this is perhaps also true regularly publish information on the gender
at a company level in the food and grocery When we drilled down into the practices pay gap and the diversity of the Board and % OF COMPANIES WITH A D&I STRATEGY
industry. When asked who they believe is of those companies reporting to have a Executive Committee, lots admitted to
D&I strategy it was interesting to see that, 100%
operating at a ‘gold standard’ on diversity finding it difficult to collect data on D&I.
in the industry, more people were unable generally, it was sponsored – or at least One commented: 90%
to name a single company than those who championed – by the CEO or MD (61%).
could. Of those that were able to name a For 32% of companies, it was sponsored It’s hard to really understand what 80%
company, no clear themes emerged and very by the HR department with only 7% claiming diversity we have. It’s easy to work out
sponsorship elsewhere in the organisation gender, and to an extent ethnicity, but 70%
often those that were named were operating
in a different part of the industry and are (for example, the communications team). beyond that we have no data. 60%
therefore perhaps difficult to replicate. For suppliers, pressure from retailers looking
at the diversity of employees in their supply Another shared a similar view, suggesting 50%
INTERVIEWEES WHO COULD IDENTIFY A COMPANY chain has forced ‘senior leaders to sit up that this had impacted on their ability to
WORKING AT ‘GOLD STANDARD’ ON D&I
and pay attention.’ establish a strategic approach to D&I: 40%
While it is important that diversity and It was apparent, very quickly, that we 30%
inclusion is a priority for the leadership team didn’t have any robust data we could
20%
and that they in turn set the tone throughout build a strategy on. This year we’ve
the organisation, companies seeing positive taken action to get it. We need to see 10%
change are making progress by engaging the the shape of our organisation in terms
of ethnicity, religion and sexuality. Then 0%
grass roots. When asked about how they had
Public
Private
PE
Retail
FMCG
Mfg
Food
Drink
Small
Medium
Large
UK
Non-UK
developed their strategies, many companies we can work out if there are differences
shared examples of focus groups, surveys in engagement, training development
57% could
and inviting people to write in with personal and recruitment etc. Afterwards, we can Ownership Type Product Size HQ
location
not identify
stories. Several shared experiences of this track the data of those applying and their
– although one respondent pointed to the success rate through process.
It seems clear that very few companies in the
industry have a truly developed and strategic importance of strategically sourcing relevant Finally, 84% of those interviewed believe
approach to D&I that others might look ideas and avoiding ‘turning into agony aunts their company is doing better on D&I
up to. Although the majority have started receiving grumbles and complaints.’ today than five years ago and 80% believe
with an initial focus on gender diversity, few Across the board, however, those that had D&I is sufficiently high up on their own
companies have progressed far beyond this. sourced opinion and comment recognised personal agenda.
For companies that are early in their D&I the value this had brought in engaging the
agenda, there is a great deal of interest in workforce in the importance of D&I.
progressing further, but this keenness is often Within the company, we’re open to
coupled with a general sense of nervousness discussing diversity and inclusion needs.
to talk about it openly. Despite having good Two colleagues set up the ‘see what you
intentions, many of those we interviewed can see’ initiative. They went to all leaders
appeared slightly defensive or cautious of and asked how D&I is important to them,
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RESEARCH FINDINGS
18 19
Gender BENEATH THE SURFACE – COMPANY BY COMPANY PROGRESS
PERCENTAGE OF FEMALE REPRESENTATION
BOARD EXECUTIVE COMMITTEE DIRECT REPORTS
HEADLINE FIGURES
350 constituents, most companies do not fall
WOMEN IN LEADERSHIP ROLES
under that categorisation and as such are not
40% subject to this level of scrutiny. Nonetheless,
it is a useful benchmark against which we can
35% 35.9% assess the performance of the industry.
30% Most encouragingly, amongst the Direct
25%
27.6% Reports community, the industry is already
above the 33% target and this demonstrates
22.2% 0% 0-15% 15-33% 33-49% 50+%
20% that if companies adopt the right approach,
there is a strong pool of talent that can rise
15% up to the Executive Committee and, over While the headline figures look encouraging The most significant impact of the
10% time, Board level roles. for the industry as a whole, it is also introduction of mandatory gender pay
important to consider how the picture looks gap reporting in 2017 has been to extend
5% Compared to the performance of companies at a company-by-company level. It is notable, the focus much more widely. Not only has
across the FTSE 350, as reported in the for example, that more than a quarter of it broadened the reach to include most
0% 2019 Hampton-Alexander Review, female the UK Boards we profiled comprised no companies of scale operating in the UK,
Board Executive Direct
Committee Reports representation at Board level is a few women at all. At the Executive Committee but it has also brought to the surface how
percentage points lower in food and grocery level, this figure rises to nearly a third. gender inequalities look across companies’
Dotted line represents 33% target
(27.6% versus 30.6%). Considering how While all companies have some female workforces as a whole.
many non-listed businesses there are in the representation at the Direct Reports level,
industry, it is perhaps surprising that the 10% of interviewees were unable to identify Being highly visible and transparent in nature,
The Hampton-Alexander Review sets out a figures are as close as they are. gender pay gap reporting has helped elevate
target for all FTSE 350 businesses to reach a single notable female leader across their
wider leadership team. the importance of gender diversity on many
33% female representation across their At the Executive Committee and Direct companies’ agendas. Moreover, by forcing
Boards, Executive Committees and Direct Reports levels, however, food and grocery COMPANIES WITH NO companies to ensure they have a handle on
Reports (into the Executive Committee) by is performing particularly strongly against COMPANIES WITH NO WOMEN AT EXECUTIVE
the data, it provides the framework and the
WOMEN AT BOARD LEVEL COMMITTEE LEVEL
the end of 2020. While the UK food and the cross-industry benchmark as shown baselines needed to drive further progress.
grocery sector contains a number of FTSE in the table below.
Availability of data is a distinct advantage
for tackling gender diversity – it is easy to
HOW FOOD AND GROCERY COMPARES TO THE CROSS-INDUSTRY define, collect and understand. Combined
2019 HAMPTON-ALEXANDER REVIEW FINDINGS 25% 33% with the pressure of pay gap reporting, it is
an obvious place for many companies to start
Level FTSE 100 FTSE 250 FTSE 350 Food & Grocery when it comes to improving D&I and indeed
this came through strongly in our interviews.
Board 32.4% 29.6% 30.6% 27.6%
COMMENTARY Companies translating understanding into
Executive Committee 23.1% 18.6% 19.9% 22.2% action are harder to come by. A third of
While powerful and high-profile initiatives businesses interviewed have developed
Direct Reports 29.3% 27.9% 28.3% 35.9% like the Hampton-Alexander Review and its only very rudimentary plans for addressing
forerunner the Davies Review have helped both their pay gaps specifically and gender
drive meaningful progress over a sustained diversity more broadly. A small number of
period, they have shone the light most organisations have made no plans at all so
brightly on a relatively narrow set – the very far. And there’s no quick fix: one company
top leadership teams of listed businesses. considered to be at an advanced stage in its
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RESEARCH FINDINGS20 21
gender diversity strategy reported that it will A handful of businesses have taken an active A sector lens BENCHMARKING WITHIN THE SECTOR
still take nine years to close their pay gap. role in sponsoring school and university Gender diversity also varies when you dissect
students to take on STEM subjects, while Non-UK based companies are leading the
the food and grocery industry by sector. Meat
A functional lens others reported that they have turned to way on gender diversity, with 37.8% female
and fishery are two sectors that tend to be
While there are reasons to celebrate how international pools of talent – particularly representation in their leadership teams
especially challenged on gender diversity,
the food and grocery sector is currently from Russia and Poland – to introduce compared with 24.9% in those headquartered
with reports that they are still seen as ‘macho’
performing on gender diversity, there is more women from a STEM background to here. Publicly listed companies outscore
or labour intensive. Gender stereotypes
clearly a way to go. It seems clear from our their workforce. Meanwhile, the fact that those privately held or private equity backed,
were similarly reported in the bakery sector,
interviews that one way of unlocking further manufacturing is becoming increasingly with 33.5% female representation compared
where companies are tackling a perception
progress is to look at it through a functional automated is opening up the opportunity to 23.0% and 20.0%, respectively. FMCG is
of men being in the more physical side of the
lens. Almost all companies reported that for more flexible working in some factories. the best performing sector in the food and
business and women in the more decorative
there are some functions where gender grocery industry, with 34.2% representation.
side. Anecdotes such as these pop up
diversity is much more difficult to achieve, HR, on the other hand, was correctly
throughout the industry – but there are
and this is borne out in our research. identified by interviewees as a function that
encouraging green shoots of progress. In the
faces a diversity challenge ‘the other way’, AVERAGE % FEMALE (ACROSS ALL LEADERSHIP LEVELS)
meat industry for example, the need to adapt
with many more females holding these
to rising consumer interest in veganism and 40%
% WOMEN IN MOST SENIOR POSITION, BY FUNCTION roles. Marketing tends to be well balanced
plant-based alternatives has driven a shift
between men and women. 35%
in gender diversity.
Chair: 8% female representation
Sales was singled out as a particular 30%
Gender identification
challenge for gender diversity within the
food and grocery sector, though there is a For a significant minority of interviewed 25%
CEO: 7% female representation
view that some progress has been made over businesses, gender identification is emerging
as a challenging area of interest, matching 20%
the last five to ten years. At the more junior
level, some companies considered field sales the increased discussion of the topic in
Finance: 9% female representation 15%
a ‘golden opportunity’ for recruiting diverse general media and public discourse. While
talent from outside the sector. it appears to be in the consciousness of HR 10%
Human Resources: 73% female representation leaders, progress is relatively nascent in terms
Nonetheless, this change does not appear of proactive initiatives. Companies that are 5%
to have trickled through to the highest taking concrete steps include a retailer that 0%
leadership roles in the function, where our has rolled out training on gender pronouns
Public
Private
PE
Retail
FMCG
Mfg
Food
Drink
Small
Medium
Large
UK
Non-UK
Marketing: 50% female representation
data suggests nearly four out of five of the and how to discuss and address those who
most-senior sales/commercial leaders are identify in different ways – ultimately seeking Ownership Type Product Size HQ
Supply Chain/Operations: 9% female representation men. Moreover, the prevalence of different to create a safe space to talk about gender location
bonus and incentive structures in sales can identification. A food manufacturing business
mean it has an overweight impact on gender is actively engaging in a project to consider
Sales/Commercial: 22% female representation
pay gap reporting. how gender identification is affected in the
most operational areas of its business, often
There is also a particularly severe shortage
viewed as a more ‘traditional’ environment.
of women at the most senior corporate level
within the industry, with less than 10% of
The barrier to successful recruitment and Chair, CEO and CFO roles held by women.
retention of women was discussed in detail The evidence shows that this is a cross-
with respect to specific job functions. Those industry issue. For example, across the FTSE
functions considered to be more challenging 350 just 4% of CEOs are women according
in terms of gender parity included to the 2019 Hampton-Alexander Review
manufacturing, operations, supply chain, – something it highlights as an issue that
IT, accounting, physical and manual labour, extends internationally too.
engineering, warehousing, driving, factories
and traditional STEM roles.
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RESEARCH FINDINGS22 23
Ethnicity COMMENTARY Also discouraged is the assumption that
one BAME individual can speak for the
It was evident in our interviews that for most BAME population at large. In our interviews,
companies, ethnic diversity is a much less companies that were more advanced on
well-developed area of their D&I approach, ethnic diversity often had created and
HEADLINE FIGURES especially compared to gender. One of empowered network groups across the
the biggest stumbling blocks is the lack of workforce to promote and understand
BAME REPRESENTATION AT LEADERSHIP LEVEL reliable and complete data. the issues affecting ethnic diversity in
15% The McGregor-Smith Review into Race in While a number of companies reported that the workplace.
12.5% the Workplace provides baseline figures they do capture ethnicity data as part of their Is the food and grocery sector attractive
for the UK population against which we recruitment process, this does not provide to people of all ethnic backgrounds?
10% 11.4% can compare BAME (black and minority an accurate reading of the workforce as a
whole. The fact that the government is likely In the 2018 Business in the Community ‘Best
ethnic) representation in the food and
7.5% to introduce mandatory ethnicity pay gap Employers for Race’ index, only two out of
7.1% grocery industry. It states that 12.5% of the
reporting provides an important incentive a total of 70 companies came from the food
5% 5.7% UK working age population is from a BAME
for companies to get a grip on their data, and grocery industry. We often find that
background, while 6.25% of business leaders
2.5% but it seems that few are taking a proactive sectors such as professional services, the
are across all industries. At Board level, the
approach at this stage. public sector and financial services dominate
food and grocery industry almost reaches
0% such lists, in part due to a perceived cultural
Board Executive Direct the UK-wide working age population, while
Committee Reports A second major stumbling block to ethnic preference among certain ethnic groups
at 7.1%, BAME representation at the Direct
diversity we found in our interviews was a for these career paths.
Dotted line represents 6.25% and 12.5% Reports level is above the cross-industry
lack of understanding around how to define
average for leaders. As an industry, therefore, there is an
it. This appeared, at least in part, to be
a symptom of a wider nervousness about opportunity to ensure that food and grocery
‘saying the wrong thing’ and it was clear that is seen as an attractive place to advance your
BENEATH THE SURFACE – COMPANY BY COMPANY PROGRESS career no matter your ethnic background
many people simply do not feel comfortable
talking about ethnicity in their business. – particularly given the positive findings
PERCENTAGE OF BAME REPRESENTATION
Across a significant minority of interviewees, in our research.
BOARD EXECUTIVE COMMITTEE DIRECT REPORTS
there appeared to be a misunderstanding Internally, some companies highlighted
about the difference between ‘ethnicity’ cultural awareness events, such as activities
and ‘nationality’. around Black History Month and Diwali,
In this sense, our findings accord with as being effective. Drawing attention
research by Business in the Community. In to BAME role models has also proved
its 2015 Race at Work survey of nearly 25,000 to be a successful tool in increasing the
UK employees, one of the key findings attractiveness of businesses in the industry.
was that employers were not comfortable As with gender diversity, though the data
talking about race – particularly compared is less clear here, sales is perceived to be
to gender, age and sexuality. In response, one of the least diverse functions from an
0% 0-6.25% 6.25-12.5% 12.5+% they produced a pocket guide called ‘Let’s ethnicity perspective. Similarly, as one retailer
Talk About Race’, written by Sandra Kerr reported, BAME representation appears
There is a note of caution attached to these headline figures, however, as many companies OBE, which encourages employers to be to be much higher at a more junior level,
simply do not capture the relevant data to understand the ethnic makeup of their leadership more confident in discussing the topic, as but it is not always converting into senior
teams or wider workforce. It is possible – indeed likely – that those companies that do collect well as avoiding questions and statements leadership roles.
the data are at a more advanced stage on diversity and inclusion generally. likely to avoid offence. “Where do you come
from? No, where are you really from?” is one Importance of the local population
Looking behind the headline figures, it is clear that there is a wide discrepancy at
such question it encourages people to One point that was made frequently in our
a company-by-company level. Nearly half of businesses have no BAME representation
avoid, and which chimes with the confusion interviews is that ethnic diversity can vary
at the Direct Reports level, and 83% of companies have no BAME representation
around ethnicity and nationality experienced quite significantly around the UK – and
on their Executive Committees.
in our interviews. accordingly, it is likely that the level of ethnic
IN
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RESEARCH FINDINGS24 25
LGBTQ
diversity within a company will be to some BENCHMARKING WITHIN THE INDUSTRY
extent determined by where its workforce
FMCG companies lead the way on ethnic
is based. Multi-site businesses – whose
diversity with 9.5% BAME representation on
operations can be spread right across
their leadership teams – twice as much as
the UK – see this most clearly.
businesses from the retail and manufacturing According to 2017 Office of National Largely because of the data challenge, it was
According to the most recent Census data, sectors. Alcohol companies performed Statistics (ONS) figures, 6.8% of the UK clear in our interviews that when it comes to
for example, the non-white population particularly poorly, with only 4.8% BAME population do not identify as being LGBTQ, proactive companies are focussing
of London is upwards of 40%, whereas in representation. In terms of size, the smaller heterosexual. However, a subsequent on inclusion. Accordingly, awareness
Wales it is little more than a tenth of that companies we interviewed had a more Government Equalities Office (GEO) events such as Pride and working closely
(4.4%). As was highlighted by one of our diverse ethnic makeup than the larger ones. National LGBT survey highlighted that 70% in partnership with external organisations
interviewees, it would be unreasonable of respondents avoid being open about such as Stonewall tend to dominate how
to hold a company based in the Highlands AVERAGE % BAME (ACROSS ALL LEADERSHIP LEVELS) their sexual orientation in certain settings companies in the industry address the
of Scotland to the same standards as one 10% and, in particular, 19% are not open about LGBTQ agenda.
based in London. This was a point that many it in their workplace. The survey reveals
manufacturing businesses raised, given that 9% generational shifts in attitudes, which could A few businesses did acknowledge that
they tend to be based outside major cities. mean that more senior staff – who tend to LGBTQ is sometimes not viewed with equal
8%
be older – may be less likely to be open priority in different parts of their business
BAME REPRESENTATION
about their sexuality. However, our interviews – for example, in a factory environment as
BY UK REGION 7%
clearly suggest that sentiment has changed compared to the head office.
0-5%
6% dramatically in the last 15 years. For less advanced companies, as with many
5-10% 5% A lack of usable data is one of the key other areas of diversity, a more reactive
barriers to understanding how the food approach is in evidence. The GEO National
10-15% 4%
and grocery sector at large is performing in LGBT survey highlighted that 23% of
15-20% 3% this aspect of diversity, as well as individual people within the LGBT community have
companies. Though some companies have experienced a negative reaction to their
40-45% 2% used surveys to help build a picture, there is sexuality in the workplace. Ensuring policies
really no reliable way to measure the sexual are in place to protect the workforce against
1% discrimination is therefore an important
orientation of workforces or leadership
0% teams. Indeed, in some circumstances trying first step.
Public
Private
PE
Retail
FMCG
Mfg
Food
Drink
Small
Medium
Large
UK
Non-UK
to do so could be counter-productive from Overall, most companies we spoke to
an inclusion point of view. reported that they are doing something in
Ownership Type Product Size HQ
location In our research, we found a little over this area of diversity, but few have reached
a quarter (27%) of interviewees could a point where it forms part of a coordinated
identify someone within their wider D&I strategy.
leadership team who is openly LGBTQ. The difficulty to measure progress in
Because companies do not collect this LGBTQ diversity should not be an excuse
data specifically, it is virtually impossible for complacency. It is notable that in the
to assess how the industry compares to the Stonewall Top 100 Employers list of 2019,
wider population. Anecdotally, it seems that there are no companies from the food and
companies tend to be either very progressive grocery sector. Outside of government
or not very advanced in their approach and not-for-profit organisations, the list is
to LGBTQ diversity; few appear to fall dominated by companies in the legal sector
in the middle ground. and professional or financial services.
Source: 2011 Census and 2011 Scotland’s Census
IN
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RESEARCH FINDINGS26 27
BENCHMARKING WITHIN THE INDUSTRY % OF COMPANIES WHO CAN IDENTIFY
almost all respondents in our research could BENCHMARKING WITHIN THE INDUSTRY
LGBTQ AMONGST LEADERSHIP not recall ever interviewing a physically
The LGBTQ community is best represented disabled candidate. The food category is making the most
in FMCG-type businesses and alcohol 60% progress when it comes to disability
companies specifically. While only 15% 50% Of course, not all forms of disability are representation, with 21% of the companies
of fresh food companies could identify visible, and a number of companies are we interviewed reporting to have a physically
an openly LGBTQ colleague in a leadership 40% taking practical steps to consider how disabled person on their leadership team.
position, a promising 67% of those from well set up they are from a neurodiversity There is more work to be done in the retail
an alcohol business could. There is particular 30% sector, which trails behind manufacturing
point of view – in particular in their hiring
work to be done in private equity-backed 20% processes. This is an area that is gaining and FMCG in disability representation.
businesses, where there was a significant momentum in wider business discourse
lack of openly LBGTQ leaders. 10% and can help ensure diversity of thought. % OF COMPANIES WHO CAN IDENTIFY SOMEONE
WHO IS PHYSICALLY DISABLED AMONGST LEADERSHIP
0% As defined by ACAS, neurodiversity refers
60%
Public
Private
PE
Retail
FMCG
Mfg
Food
Drink
Small
Medium
Large
UK
Non-UK
to the different ways the brain can work and
interpret information. It is estimated that 50%
Ownership Type Product Size HQ
location
more than 15% of the UK population are
neurodivergent – a term that encompasses 40%
attention deficit disorders, autism, dyslexia
Disability
30%
and dyspraxia. Companies we spoke to
are focusing on reducing stigmas around 20%
neurodiversity and ensuring line managers
are better able to get the best out of a 10%
Like LGBTQ, disability is an area of diversity issues that prevent physically disabled neurodivergent workforce, in turn opening 0%
up a talent pool that might otherwise
Public
Private
PE
Retail
FMCG
Mfg
Food
Drink
Small
Medium
Large
UK
Non-UK
where it is difficult to measure progress individuals joining the sector and advancing
by looking at the data. One business to the most senior leadership levels. be overlooked.
interviewed had discovered that 25% of its Ownership Type Product Size HQ
workforce has a physical or mental disability – Amongst those companies we interviewed, We heard numerous anecdotes about how location
but most companies simply do not know their physical disability is generally not an area of neurodiversity has increased teams’ problem-
figures. In our research, 15% of businesses diversity that is being treated as a priority or solving abilities, as well as an increased
interviewed were able to identify someone looked at proactively. However, one company awareness of employees who are diagnosed
within their wider leadership team who is that has been taking a proactive approach later in life. That said, it is undoubtedly an
physically disabled. However, it is striking that is Procter & Gamble, whose progress in this emerging area of focus and some people we
we are not aware of a single person with a area is covered in more detail in the Views interviewed urged caution against ’jumping
physical disability working in any Executive from the Industry section of this report. on the bandwagon’ too quickly, before the
Committee position across the industry. topic is better understood.
Many parts of the food and grocery sector
Official numbers show that 19% of the can be physically labour intensive and at a Although our interviews did not specifically
working age population in the UK is disabled, reactive level, there is a clear sense from our focus on wellbeing, mental health was
as defined by the Equality Act 2010. interviews that ours is an industry that looks frequently raised as an important part
Government figures also show that there is after people who sustain physical injuries of the inclusion agenda. Here, companies
a 30% employment gap between disabled in the workplace. Similarly, employers are seem to be taking a much more proactive
people and the working age population working hard to ensure that they comply with approach, often working with external
at large. their legal obligations to make adjustments partners such as the charity MIND. Mental
in the workplace or in hiring processes. health ambassadors and trained colleagues
What scant data we do have suggests that The question that needs to be asked is how are said to be just two powerful tools that
more can be done to understand whether effectively the sector is attracting those companies are employing.
such a gap exists in the food and grocery candidates in the first place – especially given
sector, and whether or not there are systemic its reputation for being physical. Indeed,
IN
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Age Social mobility
As part of our research, we looked at the An ageing population presents challenges Food and grocery has long been thought such as birth weight, school meal eligibility
age profiles of the Boards and Executive and opportunities for businesses but, in the of as one of commerce’s more meritocratic and state versus private education.
Committees of around 50 companies with physical parts of the industry in particular, industries. The idea of entering an industry
publicly available data and benchmarked it there’s a general sense that succession on the shop floor and making it through the One indicator we incorporated into our
against the FTSE 350 as a whole. At Board planning has been poor. Meanwhile, as ranks to CEO is one that has always been research to test the industry’s promotion
level, we found the average age of current one HR Director reported to us, individual alive and well in key parts of the industry – of social mobility is higher education. Here
members in the sector is 57, slightly below businesses are now often made up of whether that’s the shop floor in retail or in we found that, where we know a CEO has a
the cross-sector average of 60. The age of multiple generations within the workforce, food manufacturing. As such, there is a sense degree, 53% studied at an elite Russell Group
incumbents varies drastically, from 26 to 85 which can impact on the company dynamic. that the industry is good for social mobility – university. Furthermore, 47% have a Masters
– although the numbers at either end of the and our sentiment trackers revealed that this or MBA qualification too.
age scale tend to be due to family-owned In an environment of constantly-evolving view was reflected by industry leaders (68%
technological change – particularly in To test the theory that the industry facilitates
businesses. agreed that the industry is one of the best the development from shop floor to CEO,
digital – and fast-changing consumer habits, sectors in the UK for enabling social mobility).
The average age to take up a Board level companies are looking to new talent pools we profiled a sample of five retailers and
role in the industry is 56. and reskilling existing employees to meet But is the industry taking a proactive five manufacturing businesses and looked
the challenge. As well as bringing native approach to social mobility? In our interviews, at the backgrounds of their CEOs over the
Looking at Executive Committee level, the digital skills, younger employees also appear two-thirds of companies self-reported that last 30 years. We found that over that time
average age is broadly in line with the FTSE to be highly engaged with the D&I agenda, they are actively taking steps. However, period, 19% of retail CEOs and 12% of
350 average (54 versus 53), with an age range often coming with high expectations for their given that 58% of companies do not have a manufacturing CEOs had started their careers
of 32-62. The average age to take up a role employers to take it seriously. coordinated D&I approach or strategy, the on the shop floor. Moreover, across this small
at this level in the industry is 47. efficacy of these initiatives is less well known. sample, those ratios have remained broadly
As with all areas of diversity, there is a need consistent throughout the 30-year period.
Many companies are seeking to find ways to to consider how attractive the food and A number of the initiatives that companies
bring younger people onto their Boards and grocery industry – and companies within it talked about included admirable social and Those companies that are proactively
wider leadership teams to ensure they are – look to a young talent pool. Many of those community outreach programmes – ones seeking to boost social mobility within
being guided and governed by people who we interviewed expressed concern that the that can help improve social mobility in the their own workforce are taking a number
understand the customer of the future. food and grocery industry is less attractive wider community. However, these might of interesting steps. A frequent example
today than it was 20 years ago, compared more naturally fall under the banner of CSR is to increase the use of apprenticeships,
Looking at the wider workforce, age diversity either as a supplement to or a move
appears to be low on the list of priorities with other sectors such as tech. activities, rather than D&I, as their primary
purpose is not to improve social mobility away from traditional graduate schemes.
when it comes to D&I – but is certainly in the Other initiatives are targeting specific
consciousness of HR Directors in particular. directly within the company’s own workforce.
demographics, such as former offenders,
There are many ways in which it is impacting A significant part of the challenge in the children of prisoners, ex-military
businesses. improving social mobility is not only personnel and the homeless – often working
capturing the relevant metrics, but also in partnership with external agencies and
setting out what you are attempting to not‑for-profit organisations.
measure in the first place. There is no
clear, singular definition of social mobility One business that – a decade ago –
– something that materialised as a strong had a hiring policy that saw them only
pushback in our interviews. hire those with a first-class or upper-
second class degree from Russell Group
Recommended indicators of social mobility universities, now recognises that it has
can vary quite widely – and are very difficult over-indexed on university-educated talent
to measure at company or industry level – and is using an internal survey to find out
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WITH
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