Look at any glossy annual report and you will see confident statements about “our people” being the organisation’s greatest asset. Yet when you examine who gets hired, promoted and paid fairly, especially when it comes to Black talent, the numbers tell a much harsher story. That gap between rhetoric and reality is not just a moral failure; it is a material, measurable drag on productivity, innovation and growth.

The numbers don’t lie: Black talent is stuck at the bottom
Black professionals are almost absent from senior leadership, holding only around 1.5% of roles; if representation reflected the wider population, that figure would be closer to three times higher, and strikingly, this percentage has barely shifted in a decade. In the public sector, Black workers are highly represented on the frontline, around 44% in some areas of education and healthcare, yet their representation in senior posts has declined in several sectors while stalling in others, at the same time Black unemployment runs at more than twice the rate of White unemployment despite similar or higher qualifications. This is less a pipeline issue than a progression problem: research in my book ‘One Step Forward Two Steps Black’ shows that Black employees are motivated and qualified but face ongoing barriers to promotion. Recruitment agencies and internal practices reinforce bias, limiting advancement and keeping Black talent clustered at the bottom rather than the top.

Nepotism, bias and the myth of meritocracy
Everyday practices, rather than a lack of talent, sit behind the UK’s racial leadership gaps. Nepotism and reliance on personal networks in hiring and promotion quietly sideline more qualified candidates, including many Black professionals, entrenching homogenous leadership teams, eroding trust and damaging morale among those who can see that meritocracy is more myth than reality.  Major reviews have shown that formal fixes like blind CVs and written equality policies have not dismantled structural racism: the Runnymede Trust documented compounded sexism and racism for Black and ethnically diverse women throughout recruitment and progression, while the Lammy Review linked fair employment to reduced reoffending. Corporate data tell the same story: although almost all FTSE 100 companies now have at least one ethnically diverse director, only about 1% of FTSE 100 and under 2% of FTSE 250 directorships are held by Black people, revealing how far there still is to go. Put simply: while diversity targets may show modest progress on paper, Black leaders are still the exception rather than a normal, visible part of organisational leadership.

The ethnicity pay gap: a recurring warning signal
The ethnicity pay gap is a persistent warning sign that racial inequality is deeply embedded in the UK labour market. Trade union analysis has shown a large gap for years, for example, a 23% hourly pay difference between Black and White workers in 2018, with Black people holding A-levels paid 14% less than equally qualified White peers and some London public sector roles seeing pay deficits of more than a third. More recent government data reinforces this picture, showing that graduates in the “Black other” group earn around £19,400 one year after graduation and Black Caribbean graduates about £19,800, among the lowest earnings of any ethnic group. The McGregor-Smith Review estimated that closing progression gaps for Black and other ethnically diverse workers could add £24bn a year to the UK economy, roughly 1.3% of GDP, simply by allowing ethnically diverse talent to progress at the same rate as White colleagues. Yet despite this compelling business case, progress has been painfully slow: recommendations such as mandatory ethnicity pay gap reporting languished for years, and even with a new draft Equality (Race and Disability) Bill on the table, it remains unclear whether the reforms will be enforced robustly enough to shift outcomes into practice.

Culture, silence and the “stiff upper lip”
Culture amplifies or neutralises these structural issues. British workplaces are still shaped by the legacy of the “stiff upper lip”: a deep-seated norm of emotional restraint, keeping your head down and not making a fuss. In practice, this often means that employees who experience racism, bias or exclusion feel pressure to stay silent for fear of being labelled “difficult” or harming their careers. Complaints processes are seen as risky and slow, and successful, non-career-ending outcomes are rare. The result is a toxic loop. Racially unequal outcomes are treated as unfortunate but inevitable; leaders assume that if things were truly bad, people would say so; and those most affected learn that speaking out rarely leads to change and often comes at personal cost. This reality corrodes trust, increases turnover among high-potential Black and ethnically diverse staff, and prevents organisations from learning from their own data and experience.

Why this is a business problem, not just a moral one
The evidence is clear: discrimination and structural racism in the UK labour market are not marginal issues. They depress wages, restrict progression, distort hiring, and cost the economy billions in lost potential every year. For individual businesses, the cost shows up in slower growth, weaker decision-making, higher churn and reputational risk.​ The opportunity is equally clear. Organisations that take racial equality seriously, not as PR, but as a core design principle, stand to gain access to a deeper talent pool, richer ideas and more resilient teams. They are better placed to serve diverse markets, navigate social change and attract the next generation of employees, who increasingly treat equity as non-negotiable. For entrepreneurs and founders, these national patterns show up daily inside their own organisations. The choice for entrepreneurs is not whether to “do EDI” because it is politically fashionable. The choice is whether to keep paying the hidden tax of exclusion, or to redesign workplaces so that Black and ethnically diverse talent can thrive, and in doing so, unlock both justice and growth.What entrepreneurs can do differently
Ignoring racial equality is expensive; doing it well means rebuilding how a business runs, not just adding a slogan. Entrepreneurs should begin by interrogating their own data on representation, recruitment, progression and pay by specific ethnic groups, then pairing these numbers with honest conversations that reveal lived experience behind the metrics. From there, the real work is systemic: redesigning hiring, promotion and performance processes that currently reward familiar networks and nepotism, making promotion routes and stretch opportunities transparent, and treating ethnicity pay and progression gaps as board-level priorities with clear accountability and timelines. Racial equality is not an ethical add-on; it is a core driver of productivity and growth, and a litmus test of whether organisations are truly serious about performance in the real world.