Britain’s biggest companies are failing to produce adequate data on their workforce practices, according to a comprehensive analysis of their reports and accounts by the High Pay Centre (HPC) – an independent think tank.
Its research found that there was “a significant variation in the quality and levels of FTSE 100 company reporting” on four themes – composition, stability, skills and capabilities, and engagement. In the report – Hidden talent two – it said that while there was some disclosure on each of these metrics, “there were no universal disclosure practices across the group over and above statutory requirements.”
Since it published its first report on the topic last year, HPC noted “some instances where workforce reporting by FTSE 100 firms had improved”, although this was starting from a very low base. It found more reporting of aggregated turnover rate this year, for instance, and more disclosure on the proportion of full and part time staff and evidence of motivation and commitment towards corporate goals, such as employee awards and schemes designed to foster teamwork.
More to do
But it said there was more to be done: “One of the most interesting findings is that meaningful reporting on issues achieving prominence in recent policy debates such as mental health, the ethnicity pay gap or age diversity remains rare.”
Key findings included:
With increasing interest from both the media and the public, poor reporting carries with it significant reputational risk. In 2017, the industry body Share Action, launched its Work Disclosure Initiative – 90 global companies signed up to its aims of improving disclosure in this area.
Its 2018 progress report – Improving the quality of jobs– mirrored the more recent work done by HPC. It suggested three key initiatives to help tackle poor disclosure in these areas.
Continue to build internal dialogue between different functions. Cross-functional coordination and information sharing is essential for companies to adequately manage and address workforce risks and opportunities. Leadership must ensure there are clear roles and responsibilities, and that those tasked with collecting and reporting this data have the capacity and support to deliver on investor expectations.
Prioritise data collection and reporting on key areas, as discussed in this report. Companies need to start filling the gaps and increase their ability to respond to the workforce data points that investors are most interested in, as outlined in the WDI. We encourage companies to study the guidance that accompanies the survey and assess what steps are needed for them to start collecting and reporting data within this framework.
Increase public reporting of workforce data. Companies should not fear transparency. Investors want companies to report their workforce data publicly so that data is available to all interested stakeholders and so that their practice can be acknowledged and help to drive improvements across sectors and economies. Companies are not expected to have all the answers immediately – publicly acknowledging data gaps and where progress is needed is a positive indication of intent, and one that sets companies positively apart from their peers.