Employers are waking up to the fact that a diverse graduate intake helps them tap into a wide customer base

British employers are showing an increasing commitment to ethnic minorities in all aspects of business, according to Race for Opportunity (RfO). The number of organisations that have a clear business case for having race issues on the boardroom agenda has grown significantly, claims the Government initiative which offers specialist support and advice to businesses and rates how ethnic minorities are treated in their companies.

"An unprecedented number of organisations from both the private and public sector have risen to the challenge this year of reporting on the performance of their UK operations on race, and on what is making a real difference now," says Allan Leighton, RfO chairman. "Quite simply, they realise that communities equal profitable customers and potential employees. If you rely on traditional perceptions of who these groups are, you limit your pool of talent and your target market."

The top performer in RfO's report is Lloyds TSB and like many of today's businesses, it is focusing on the issue of race within its graduate cohort. "Among the most effective changes the bank has made since the late Nineties has been working specifically with minority ethnic graduates and their families to show them that banking is a worthwhile career. We have also made the imagery of our literature far more inclusive and made links with newer universities, where there are higher proportions of ethnic minorities, rather than just concentrating on the traditional ones," says Andrew Wakelin, senior manager, equality and diversity.

Meanwhile, top diversity performers in the public sector include local authorities. Like all public sector employers, they are now obliged by law to promote and monitor race equality, and in many areas - including graduate intake - they are attempting to go the extra mile.

The business case for diversity has just about been won in the graduate market and what many employers have now moved onto is focusing on how to achieve a diverse workforce, says Carl Gilleard, chief executive of the Association of Graduate Recruiters (AGR). "Having had conversations with many graduate recruiters this summer, it is clear that a growing number are desperate to find out about formulas that have been successful in other organisations and what new methods are being tried and tested."

There is still a long way to go, Gilleard admits. "But the kind of commitment we are now seeing is leading to significant improvements not only in terms of recruitment opportunities, but also retention and progression."

Indeed, many employers are realising that while it's one thing to get more minority ethnic graduates in, it's quite another to keep them there and to ensure fair promotion opportunities. Efforts to address this include mentoring schemes, networking opportunities, training schemes aimed specifically at improving the confidence and/or skills of ethnic minorities and efforts to improve the inclusion agenda within the organisation's culture.

All graduates, irrespective of their ethnicity, are far more likely than their predecessors to take into consideration an organisation's diversity policies as part of their decision on whether to work for them, says Gilleard. "As such, a strong diversity agenda is fast becoming an expectation, which in turn means employers who want high-calibre graduates can no longer afford to ignore the issue," he explains.

The Commission for Racial Equality (CRE) reports that graduate employers who are taking up race equality most determinedly include banks, building societies and high street stores. "Some of them have been quite explicit about it, saying that by failing to do take the issue seriously, they will not only be ignoring one in six graduates but will fail to attract a wide customer base," says a spokesperson.

Among them is Barclays, where a specialist diversity unit has helped drive the recruitment of minority ethnic staff from 6.3 to 8.3 per cent over the last two years. An in-depth review of its diversity policy and an initiative aimed at increasing the number of ethnic minorities in senior positions has culminated on two people being appointed to the board.

Nicola Swan, diversity director at the company, was given a team of 11 people to examine the whole area of inclusion across the bank's entire operation. The team started the process by carrying out a staff survey to look at the overall picture on diversity at the bank. They decided to focus on four key areas: fairness in recruitment and selection, handling inappropriate behaviour, building an inclusive culture and work-life balance.

Swan then reviewed the whole recruitment process to ensure it had no race bias, as well as improving the psychometrics and widening the number of universities it selected from. Recruitment agencies used by Barclays were called in for a briefing to encourage them to look at ways of attracting a more diverse range of candidates. Swan also identified minority ethnic role models within Barclays to act as inspiration to others. Those interested in rapidly progressing up the ladder were given extensive career development and coaching. "Our objective is to ensure our workforce represents the community it serves at all levels," she explains. "We want to target more diverse customers as well."

At Asda, efforts to increase the number of minority ethnic graduates has been more subtle. Jill Grundy, graduate resourcing manager, says: "We want people to see how far our minority ethnic graduates are going within the organisation, and we therefore show this off in our graduate literature. But we don't attend specific careers fairs or events aimed solely at minority ethnic communities because we see that as positive discrimination. Nor do we get hung up on targets. Rather, we are hung up on ensuring the message gets out that all graduates, whatever their background, have the opportunity to reach their full potential. It seems to be working well."

Ford Europe, where graduate minority ethnic applications have increased from six per cent to 35 per cent in three years, is rather less subtle. Surinder Sharma, director for diversity, says: "Among the changes we have made are increasing the number of universities from which we recruit, starting a mentoring programme for undergraduates, publicising the wide range of careers within Ford, looking at our policies around things like bullying and attending graduate diversity fairs."

Terry Dray, assistant director of the University of Manchester and UMIST Careers Service, claims graduate diversity fairs are proving increasingly effective as a showcase of graduate employers dedicated to equal opportunities. "Our fair attracts around 50 recruiters a year including the Inland Revenue, the BBC and the major banks, and has an added dimension to other recruitment fairs by providing a forum in which diversity issues really are up for discussion," he says.

Graduates should take advantage of such opportunities, believes the TUC. Its recent report found that racism persists, often in disguised forms, despite real progress having been made in combating race discrimination at work over the past decade. Mike Power, co-author of the report, Black Voices at Work, explains: "What was fascinating was that when we asked a range of ethnic minority workers from all over the country about the main problems they face in the workplace, they mentioned the same things that anyone might: work-life balance, job satisfaction, stress. Not one mentioned racism. But when we asked them directly if they could think of experiences of racism, a significant proportion said yes."

The reason they failed to mention the racism initially, believes Power, is that it is often covert, less obvious and therefore more difficult to prove - so they try not to focus on it as a problem.

RfO reports that it is well aware of such claims and is determined to overcome them. Indeed, Trade and Industry Secretary Patricia Hewitt recently wrote to 500 of Britain's top companies to urge them to join RfO. Speaking at its annual dinner in October, she said: "Only 18 FTSE 100 companies went for benchmarking this year. Next year, I want to see this double, or more."

Hewitt explains: "We are determined to create a Britain where everyone can reach their full potential, where racism in unacceptable and counteracted, and where racial diversity is celebrated."

CASE STUDY LLOYDS TSB

"Back in the late Nineties, we identified that only three per cent of our graduate intake came from ethnic minorities when 12 per cent of people graduating at that time were from these groups," says Andrew Wakelin, a senior manager equality and diversity for Lloyds TSB. "We did a huge amount of work that started with focus groups across universities with undergraduates and the lessons we learnt have enabled us to become far more inclusive."

The biggest lesson was that many ethnic minorities didn't see banking as the dynamic career their parents hoped they would go into, he says. "So the first thing we had to do was not only sell the Lloyds TSB brand, but also banking as a career, to both graduates and parents."

Graduate literature started including more black and Asian faces, with case studies on those who had been promoted in a short space of time. "In addition, we started building links with universities that attracted ethnic minorities," says Wakelin.

The research showed minority ethnic graduates are more likely than white candidates to want to use their degree in their chosen career and that they were likely to stay longer with the same employer. "So we also utilised such findings into our recruitment strategies," he says.

Along with awareness training across the bank, the initiative meant that while in 1997, just three per cent of Lloyds TSB's graduate intake was from ethnic minorities, that figure grew to 25 per cent this year. "To be honest, we are not doing an awful lot anymore, because once we'd made these changes, it started becoming business as usual that one in four applications comes from an ethnic minority," says Wakelin.

Jas Chima, a project manager who started as a graduate for the bank in 1999, says: "I received offers from several blue-chips. But I got a feeling during the assessment process within Lloyds that they were very positive, not only about diversity but in developing every one of their employees."

Chima adds: "The diversity initiatives in place, particularly around mentoring and networking, have been very reassuring in demonstrating that I was right. I know there is huge opportunity for me to achieve my potential within this bank."

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