Lloyds Ban (LYG)k has become the first UK lender to disclose the pay gap of its Black employees, shining a light on the dearth of Black people in senior positions as it promised to tackle racial inequality in British business.
In a report published on Friday, Britain’s biggest retail banking group revealed that the median pay gap between Black employees and their peers is 19.7%, while the median bonus gap is 37.6%. For Black, Asian and other employees who don’t identify as White the median pay gap is 14.8% and the bonus gap is 32.5% compared with White colleagues.
“Our overall pay and bonus gaps are driven by lower representation of Black, Asian and minority ethnic colleagues at senior grades,” according to the report. On average, those employees — who account for 10.3% of staff and occupy 7.3% of senior management roles — are not paid less than White employees at any individual level, Lloyds said.
Black employees make up 1.5% of Lloyds staff and occupy 0.6% of senior management positions — equating to just 40 people out of a senior management team of roughly 7,000.
“That’s not good enough; and it’s why we have resolved to take action,” CEO António Horta-Osório said in a statement, adding that Lloyds is an “anti-racist organisation.”
The report marks the first time that a UK bank has broken out pay gap data for Black employees. Barclays (BCS) and NatWest have previously published combined data for Asian, Black and other workers who do not identify as White. Lloyds Banking Group also includes brands such as Halifax and Bank of Scotland.
Unlike gender pay gap reports, which are mandatory in the United Kingdom for companies with more than 250 workers, ethnicity pay gaps are published on a voluntary basis.
The stark differences in pay and seniority between Black and White employees reflected in the Lloyds report highlights a much wider problem in Britain, where Black people are woefully underrepresented in senior leadership positions.
According to an independent review published in February, just six directors who do not identify as White hold the position of chair or CEO at companies in the FTSE 100 (UKX) index and nine in the FTSE 250. Black FTSE 100 (UKX) CEOs, CFOs or chairs make up just 0.7% of the total, according to Lloyds.
UK companies have faced growing pressure to tackle racial injustice within their own ranks in the wake of the killing of George Floyd in June, which sparked Black Lives Matter protests across the United States, Britain and elsewhere. It also saw a string of organizations, including the Bank of England, apologize for historic ties to slavery.
Lloyds published a Race Action Plan in July to address the specific challenges faced by Black employees and set a goal to increase Black representation in senior roles to at least 3% by 2025, in line with the overall UK labor market.
It became the first big UK-listed company to set a public target to increase the representation of Black, Asian and other groups who do not identify as White in senior management in 2018, aiming for 8% by the end of 2020. Lloyds said Friday that this will play a key role in helping it close its ethnicity pay gap over time.
It also unveiled a Black Business Advisory Committee to better support Black business owners, who report lower turnover and profit than White entrepreneurs, according to an October report by the British Business Bank. The report identified differences in access to finance and social capital as among the reasons for this.
Claudine Reid, a former adviser to the UK government on social enterprise, will chair the committee, which will also comprise other Black founders and business owners. The committee will investigate the barriers to growth for Black entrepreneurs.