Who holds accountability for workplace discrimination?

In the 1980s, the employment of ethnic minorities in the UK was so dire that the Commission for Racial Equality launched a formal investigation. Its shocking findings were that white graduates were three times more likely to be appointed to posts than minority candidates, and that white interview candidates in general were twice as likely to be offered a role.

One industry in which these findings were painfully apparent, and which still bears evidence of them today, is accountancy.

It’s true that the number of visible minorities in accountancy is increasing, thanks in part to organisations such as the American Institute of CPAs setting up scholarships, doctoral fellowships and career development seminars. Despite this, research has highlighted that over 30 years on, several distinct forms of discrimination still persist within the industry.

Access discrimination

Access discrimination refers to practices that prevent individuals from having equal access to a given profession, simply on account of their minority status. In the context of accountancy, this type of discrimination impacts acceptance onto university courses and recruitment into a professional organisation.

Statistics from the Higher Education Statistics Agency do show growth in the number of ethnic minority students studying and graduating from accounting degrees in the past decade. In 2000/01, 28.9 percent of accountancy qualifiers were of ethnic backgrounds. By 2012/13, this had risen to 43.9 percent.

These figures are comparable to those in the USA, where the number of minorities studying accountancy is also 43 percent. However, whilst direct comparisons are not straightforward, analysis of the Big Four accountancy firms reveals that only KPMG actually recruits minorities in comparable numbers.

Double-entry discrimination

The shortfall in recruiting minorities may be due to a continued reliance on students from top universities. Although some progress has been made in diversifying student populations, under-representation continues to be particularly apparent in Russell Group universities, where black and Asian state school applicants are less likely to receive offers than equivalently qualified white peers from private schools.

Whilst the top universities claim – of course – that they are objective in their decision-making, there are some observations that contradict this. Durham University researchers found, for example, that applicants from black, Pakistani and Bangladeshi backgrounds were significantly less likely than white applicants to be offered a place at Russell Group universities, even when they had achieved the same exam grades at A-level.

Accountancy firms’ reliance on elite schools and the lack of interest in students from other universities reflects a belief that some degrees are better than others; an outcome not dissimilar to American accountancy firms not trusting qualifications obtained by students at black colleges.

Ultimately, however, minorities are less likely to enter the top universities and so are less likely to be offered a place in an accountancy firm, despite being as motivated, engaged and confident as white students; in other words, double entry discrimination.

Subtle discrimination

Although racism in professional settings may no longer be blatant, often it has simply taken on a more sophisticated form. For example, six months after graduating, minority students are more likely than their white counterparts to be unemployed. Likewise, the universities which have the highest number of accountancy students employed after graduation are also those with lower numbers of minorities.

It has also been suggested that minority recruits could be discouraged from entering the profession by a lack of appropriate role models. Seeing fewer ethnic minorities in senior positions suggests to new starters that success for minorities in accounting is unlikely, if not impossible, and potential recruits have been known to self-deselect on the grounds of anticipated future rejection.

Treatment discrimination

Minorities in accountancy firms often report being stereotyped and that they are judged by their ethnicity rather than on their performance; something known as treatment discrimination. Substantial survey and anecdotal evidence suggests that, once inside the door, minority professionals are frequently subjected to treatment discrimination, including unfair assignment of projects and stunted upward mobility in the organisation.

A lack of social capital

Studies of accountancy firms show that minorities feel compelled to hide their ‘difference’ in order to claim a right to equality in the workplace. Research also shows that minorities feel being the ‘other’ in a workplace has a negative impact on their chances of promotion or professional advancement.

Some of the most common stepping stones to discrimination are misattributions and stereotypes concerning minorities, with minority women reporting being stereotyped more than minority men or white women. Other hurdles that are regularly reported include being given less challenging assignments, having good performance attributed to factors other than ability and not having access to informal networks within the firm.

Being overlooked for more challenging projects has a long-term impact on an individual’s career, as such opportunities allow the development of skills, professional networks and client relationships. All of these factors impact a person’s visibility and, ultimately, ability to progress.

Conclusions

There can be little doubt that accountancy firms are taking diversity more seriously than they did in the past – but that may not be saying much. The increase in the numbers of graduates taken on, with the exception of KPMG, is still not in line with the number of minorities studying accountancy at university. Likewise, subtle forms of discrimination, feelings of marginalisation and a lack of sense of belonging ultimately push black professionals to leave firms.

The progression to partner is as tortuous and laboured as ever for minorities. The issues, despite what firms may claim, remain: stereotyping, a biased view of leadership capabilities and lack of support for development for minorities. The indifference to race equality is there for all to see and as a consequence, we can only conclude that it remains a work-in-progress.