Social mobility refers to the passage of an individual or a group of individuals from one social category to another. This can include households, families or any other category of people within or between social strata among a society. In essence, it is the change social status relative to a person’s current social location within a given society. In the professional world, this translates into the position that a person has in the company at a given time and which might evolve and change throughout their professional career.
Social mobility is a fundamental element for the banking and financial service sectors. A 2019 study by KPMG found that 41% of people working in finance in the UK had relatives in the same sector, far above the national average of 12%, raising concerns about the lack of accessibility to the sector. The study also showed that students from some backgrounds were less likely than others to get City roles following graduation. In addition to this, a report by The City of London explored data from eight of the major employers within the finance industry, detailing that people from less privileged backgrounds take 25% longer to progress their careers within an organisation in comparison to some of their counterparts, despite there being no evidence of poorer performance.
Fast forward to November 2020, and an independent taskforce was launched by HM Treasury and BEIS, conjointly run by City of London Corporation to focus on improving the representation of socio-economic diversity at senior levels in financial and professional services across the UK. In addition to this, the FCA launched their ‘Diversity and inclusion in the financial sector – working together to drive change’ paper in the summer of 2021.
The paper reads that ‘the serious lack of inclusion and inequalities between different social groups have existed within our society for years’. The FCA went on to argue that, despite this ingrained indifference, it is critical that the finance industry and financial regulators participate in the change for addressing the negative impact of a lack of social mobility. This statement from the FCA was followed by the motivation of the institution to prompt firms they regulate to do more, at speed, to improve inclusion and diversity within their own firms workforces