The Urgent Imperative for Racial Justice Lens In UK Social Investment Sector
The recent murder of George Floyd following decades of police brutality towards the Black community reminds us that so much more needs to be done to tackle systemic and institutional racism – not only in the US but here in the UK and around the world. It’s imperative that as a sector we recognise that police brutality is not outside our remit and now more than ever we need to be allies. We wholly support our brothers and sisters in the Black community and stand in solidarity with the #BlackLivesMatter movement.
These events as well as the racial inequalities exposed by the Covid-19 crisis in the UK, mean that the social investment sector needs to urgently step up to the imperative of racial justice.
Racial economic inequalities in the UK
The Colour of Money, released in April 2020 by Runnymede Trust, found shocking levels of racial wealth disparity in the UK. Black African and Bangladeshi households have 10 times less wealth than White British people. Structural inequalities within society will mean that Black African and Bangladeshi people are more likely to be in junior positions and less likely to be earning as much as their white British counterparts.
Many BAME led community organisations, already hit hard from decades of under funding, also often have less access to resources, time and staff. This means that they are less able to promote themselves to funders with 65% having an average turnover of less than £10K annually. Without their services, particularly during this time, many communities will be left without vital support and essential provisions. The social investment sector, which provides much-needed finance to social enterprises across the country, should also redress the wealth inequalities on a household and organisational level, perpetuated by mainstream finance.
Our ask from social investors
At Diversity Forum, we reiterate the manifesto we issued over 2 years ago to call for social investors to sign up. In light of the racial justice agenda, we have highlighted specific, urgent items in italics.
1. We will commit to diversity in our team at a staff and governance level, including diversity of people from BAME backgrounds, especially Black and Bangladeshi, as these are communities particularly disadvantaged given the Covid-19 crisis
2. We will commit to exploring approaches and methods that help to bring equality, diversity and inclusion in how investment decisions are made in the social investment space across the UK. We will explore specifically racial equity investing, an approach adopted by other investors.
3. We will commit to exploring new mechanisms to support organisations to become more diverse across the UK. We will commit to collecting demographics data about our investees’ leadership and their customers. We write to our investees about our commitment to racial justice and support them on the same journey.
4. We will commit to finding ways to encourage social investments to support the full range of diverse recipients and issues we have in the UK. We will look into the areas we fund and investigate whether certain ethnic groups are more disproportionately affected, or whether certain ethnic groups are not systematically getting funding and come up with a concrete action plan on how to address them in the next 3-12 months.
In our report published in January 2019, Black Asian Minority Ethnic (BAME) women are the least likely to hold directorship in the sector, accounting for just 16 (or 2.8%) of all Board Directors. This is an alarming statistic and one that needs to be addressed urgently. How can we serve the communities we are set out to serve if we are not representative of them?
While today we express our support for racial equality investing, we continue to support all equality, diversity and inclusion efforts in our sector, particularly on gender, disability and LGBT+ issues, and recognise that these structural inequalities are interlinked. It is clear that we need to do better and we risk being on the wrong side of history if we don’t act now.