A multinational investment firm is forcing staff to seek approval before hiring white men in one of the most stringent diversity policies in the financial sector to date.
State Street said it would require managers to demonstrate they had interviewed female and ethnic minority candidates before the company would sign off the hiring of a white man to a senior role.
It is the latest effort to diversify recruitment, with executives’ bonuses also tied to whether they had met targets to boost recruitment of minority staff.
“All of our leaders have to demonstrate at their annual appraisals what they have done to improve female representation and the number of colleagues from ethnic-minority backgrounds,” Jess McNicholas, State Street’s head of inclusion, diversity and corporate citizenship for Europe, the Middle East and Africa, told the Sunday Times.
“This is now front and central for State Street – it’s on every senior executive’s scorecard.”
Women’s median annual pay at State Street’s UK office was 17.4pc less than men last year, and bonuses were a third lower, according to government figures. Across the UK, the figure is 15.5pc.
State Street, which dates back to 1792 and is based in Boston, has said it plans to triple the number of black, Asian and other minority staff in senior roles by 2023. The firm handles tens of trillions of dollars of investors’ assets and recently agreed to pay $3.5bn (£2.6bn) for the investor services business of the private bank Brown Brothers Harriman.
In addition to showing it has considered candidates who are not white males, recruiters must put together a panel including at least one woman and one person of colour.
The policy makes the company the latest to link executive pay to diversity targets. Santander said recently that bankers would get bigger bonuses for hiring more women and minorities, as well as demonstrating progress on climate change.
The Financial Conduct Authority and Prudential Regulation Authority have said they could force companies to link bonuses to diversity targets, saying progress in the area needs to be sped up.
