In September, the UK’s Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) launched a consultation on proposed mandatory disclosures to promote diversity and inclusion in the 1,500 companies with over 250 employees in London's financial district.
Now, the regulators are facing resistance from the industry. The proposed rules would require that firms disclose data related to age, sexual orientation, gender, health conditions, ethnicity, and religion among their workforces. Many companies object to the mandatory disclosure requirements, citing concerns about infringing on employees' privacy and forcing individuals to share personal information.
"There's a tension if people don't want to share that . . . you can't force a person to respond," said one industry executive. Furthermore, some firms have expressed worries that disclosing detailed metrics about their leadership teams could inadvertently violate data privacy rules if individuals in these groups are identifiable. "The proposals do indeed seem to want to force disclosure from employees that we don't think it's right to enforce," another bank executive said.
In response, the FCA has said that safeguards to address these concerns have been implemented, and outlined methods by which firms may combine data sets so as to protect individual identities. The regulators encourage firms to participate in the consultation and to propose alternative approaches. The consultation period for these proposals extends until December 18, with final rules expected next year.