The Parker Review: What it means for employers
Advisory Guide: What the Parker Review means for employers
Summary
The latest Parker Review results have now been published, with progress updates that show that UK businesses have made substantial progress on ethnic diversity at the board level. The original ambition “One by ’21” for FTSE 100 and “One by ’24” for FTSE 250 has largely been met. 98% of FTSE 100 companies now have at least one ethnic minority director, and 82% (205 of 236) of FTSE250 have also met the target.
However, the data also show that representation at board level is running far ahead of progress in senior management pipelines, particularly for Black talent and ethnic minority women.
As our clients increasingly ask what “good” looks like on ethnic diversity, these results provide encouragement and a clear signal that there is still work to do to sustain this progress by improving the diversity of executive pipelines.
It also signals that the next phase of accountability is shifting from representation to outcomes, especially with ethnicity pay gap reporting on the horizon.
What employers need to know
The Parker Review shows what sustained leadership attention can achieve. It also highlights that board‑level success is only the beginning; there needs to be an increased focus on the leadership pipeline. Ethnicity pay gap reporting is also the next big test as it will reveal whether organisations have truly built inclusive systems or whether progress stops at the boardroom door.
Parker review update at a glance
Representation on boards has significantly increased and board diversity targets have largely been achieved:
FTSE 100
98% now have at least one ethnic minority director
20% of all board seats are now held by ethnic minority leaders
14 ethnic minority CEOs, a record high
In 2019, only 52% of FTSE 100 companies had an ethnic minority director. Today: 98 out of 100 do.
FTSE 250
82% (205 of 236) have met the target
Ethnic minority directors now hold ~16% of board director positions
However, 45 firms either have no representation or did not provide data
PRIVATE COMPANIES
Only 42% of the UK’s 50 largest private companies are on track to meet the 2027 target (down from 48% in 2024). Several still have all‑white boards or are not reporting at all, signalling weaker engagement vs listed companies
The challenge
While board diversity has accelerated, the story looks different below board level. Ethnic minority executives represent ~11% of senior managers in FTSE 100 companies and ~10% in FTSE 250 companies.
Black talent remains particularly underrepresented in senior management, and ethnic minority women face the steepest progression barriers, reflected in the very low number in the most senior roles, including CEOs.
The Parker Review results confirm the structural pattern we see across our client base:
Ethnic minority employees are over‑represented in junior roles and under‑represented in high‑pay, high‑influence roles
This is the primary driver of pay disparities, not unequal pay for equal work, but unequal access to progression
What the Parker Review is now asking organisations to do
The Review is encouraging UK companies to set internal senior leadership representation targets by December 2027. There is also a clear call for large private companies to step up, given the slower progress in that segment. It is also clear that attention must stay firmly on the pipeline and the systems that produce unequal outcomes for Black and ethnic minority talent
Actions to take now
A critical enabler will be better data quality. Many companies still struggle to collect accurate ethnicity data, as reflected in non‑responses and incomplete reporting, particularly in the FTSE 250.Data quality must also extend beyond basic demographic collection into succession planning.
What next?
While the Parker Review focuses on representation, ethnicity pay gaps focus on economic outcomes. Together, they create a more complete picture of organisational equity.
The introduction of mandatory ethnicity and disability pay gap reporting in the UK will create the most significant shift in corporate diversity accountability since gender pay gaps and will make inequalities visible and quantifiable.
Why this matters for organisations
Ethnicity pay gap reporting will:
Expose whether representation improvements at the top are matched by equitable career progression
Require companies to publish:
Pay distribution by ethnicity
Representation across pay quartiles
Make visible where leadership pipelines are failing ethnic minority groups
Shift leadership conversations from “having a diverse board” to “having a diverse organisation at every level”
The biggest lever for reducing pay gaps will be progression and access to leadership pathways, not adjustments to pay itself. This directly reinforces the Parker Review’s call for accelerating senior management diversity.
What you should prioritise now
To build progress and avoid significant pay gaps being revealed in future reporting, we encourage organisations to:
Invest in building colleague trust in how data is used and improve DEI data collection. Build data into succession planning to improve visibility of who is being considered, sponsored or developed for future leadership roles.
Set measurable proportional representation targets rather than arbitrary numbers. Targets grounded in actual workforce demographics are more meaningful and credible and avoids the trap of chasing a number.
Improve data. This is essential, but it sometimes takes time, and it cannot be the only focus. Even before high‑quality ethnicity and DEI data is available, organisations can (and should) begin unpicking the systems that shape talent outcomes. This is where audits become powerful in reviewing processes such as performance management, access to development, succession planning, and promotion decision‑making. By auditing these processes early, organisations can start shifting outcomes now, while building the data foundation needed for ethnicity pay gap and DEI reporting.
Leverage SME recommendations and cross-sector learning to strengthen leadership pipelines.
Want to discuss how the Parker Review could impact you and what actions your business should take? Contact the team today.