Lack of diversity in the property sector is a real problem, here are some ideas for how to tackle it …
Diversity has become something of a buzzword in business circles recently, but it remains an elusive concept for property and construction professionals in the UK. According to the RICS, women represent just 11% of the construction sector, and only 13% of chartered surveyors in the UK.
Moreover, gender is just the tip of the diversity iceberg, with data from CABE suggesting that black and minority ethnic (BME) representation in the sector is as little as 3%, compared to 8% for the general population.
And anecdotal evidence suggests that lesbian, gay, bi-sexual and transgender (LGBT) staff, as well as employees with disabilities, are both significantly under-represented in the property industry.
The scale of the problem does appear to be significantly acute in real estate, especially when compared with other sectors. For instance, the legal profession has 13% BME representation, and more than half of new entrants to the industry are women.
Traditionally some might have had the view that a diverse workforce is not a pre-requisite for strong business performance, but such a view looks increasingly myopic and outdated. Indeed, there is now widespread evidence that companies with more diverse boards and staff profiles perform better commercially. In 2013 research conducted by Korn/Ferry found that nearly all executives polled in a global survey believed there to be a link between diversity and business results. Research in 2014 conducted by McKinsey into the UK’s leading 30 companies found that those in the top quartile for diversity outperformed those in the bottom quartile in terms of profit margin and return on equity by 5.6% and 11.1% respectively during 2008-10.
It is now widely recognised that a diverse workforce enables more balanced decision-making and better reflects the varied views and opinions of customers. Research from the CBI found that a diverse workforce is better able to understand how a diverse customer-base thinks and respond to their needs, as well as enabling companies to access new markets. It also highlighted that a more diverse workforce results in higher levels of employee satisfaction.
Three years on from the publication of Lord Davies’ Women on Boards report, women’s representation on FTSE 100 boards has risen to 20.7%, up from 12.5%. Government now mandates disclosure on gender diversity in company reporting through the Companies Act 2006 Strategic Report requirements, a move that follows successful industry-level disclosure requirements such as those introduced in the legal sector.
The shift in women representation between RICS trainee level (28%) and chartered level (13%) demonstrates the difficulties in retaining and promoting a diverse workforce
So, what can, and should, property companies do to address this lack of diversity? In truth the issue is a complex one, and needs to be carefully addressed at all stages of a potential employee’s lifecycle. Right from the outset, firms ought to be promoting the attractiveness of real estate to students and apprentices from wide-ranging backgrounds, but they also need to demonstrate leadership through strategic talent management and retention programmes that promote career progression, training and development for all different workforce segments. Listed below are some good practice examples which already exist to demonstrate how this can best be achieved.
Outreach to increase industry’s appeal to wider cross-section of society
Efforts to improve awareness of the industry among a more diverse talent pool include the influential Pathways to Property initiative. Led by Reading Real Estate Foundation, in partnership with British Land and The Sutton Trust, and backed by JLL amongst many others, this initiative seeks to attract talented students from less advantaged and non-traditional backgrounds into the property sector.
Improving skills & employability amongst disadvantaged groups
Construction skills centres and apprenticeship programmes have proven successful in employing and upskilling disadvantaged groups in site roles. Land Securities’ flagship London Employment Strategy has already helped over 200 disadvantaged young people to secure long-term sustainable employment in the construction industry, and it is now being expanded to cover other areas in the property lifecycle, including facilities and property management.
Companies are now beginning to apply this approach in their corporate operations. For example, JLL launched its own apprenticeship scheme in 2013, and is actively involved in Business in the Community’s Ready for Work programme which assists disadvantaged individuals to gain and sustain employment.
Training, promotion and retention strategies
The shift in women representation between RICS trainee level (28%) and chartered level (13%) demonstrates the difficulties in retaining and promoting a diverse workforce. Diversity networks and mentoring can be key to developing staff, and training for managers and decision-makers is fundamental in engendering an inclusive organisational culture. McKinsey research also noted that alongside company culture, strong leadership commitment is integral to the success of diversity strategies.
Collaboration and partnerships
Industry collaboration holds the key to widespread change and in the last few years we have seen the launch of multiple partnerships seeking a sector-wide transformation.
- Changing the Face of Property campaign, co-founded by JLL, is now very high profile and has the backing of several sector leaders.
- Freehold, the LGBT charity for property professionals which was only set up in 2011, now has over 550 members.
- Building Magazine’s own Building A Better Balance initiative aims to explore hidden concerns held by many working in construction - including mental health, diversity and tolerance to others.
The leadership commitment of so many property players to these cross-industry initiatives, and indeed the recent confirmation of Louise Brooke-Smith as RICS’ first female president, themselves seem to suggest that the property industry may be finally stepping up to the inclusivity challenge.
Julie Hirigoyen is UK head of sustainability at JLL