Consulting and finance firms hire more black candidates when using anonymous ‘skills-based’ tests in the hiring process
City employers are more likely to hire black candidates if they rely on anonymised, “skills-based” assessments in the hiring process, instead of more traditional interview methods, new research shows.
Finance and consulting firms hired 79 per cent more black candidates when they relied on skill-based assessments, over more traditional methods such as cover letters, group tasks, and presentations, according to a new study from software company Applied.
The study of 1,300 job seekers saw candidates take numerical tests and undergo structured interviews in which questions on “cultural fit” or personal interests were not permitted, as they were also asked specific questions on how they would deal with specific situations.
The research found black candidates had higher rates of success when such “skills-based” assessments were used, in a sign anonymised testing may help address the City’s diversity crisis.
Khyati Sundaram, chief executive of skills-based assessment platform Applied, said: “Firms who are genuinely committed to redressing the balance for Black and minority ethnic groups need to address the unconscious bias in their hiring processes.”
“CVs and interviews can lead hiring teams to assess candidates based on their names, previous jobs and ‘cultural-fit’ – and are known to disadvantage Black applicants.”
“Assessing candidates’ skills instead is the fairest, most accurate and most objective screening method. And when hiring decisions are based on true potential, our new research shows that Black consulting talent shines through.”
The research comes amid a push amongst the City’s major firms to increase diversity, which last month saw Big Four accountancy firm KPMG introduce mandatory unconscious bias training for the entirety of its 15,800 strong workforce.
Last year, the UK’s Financial Conduct Authority (FCA) and the Bank of England jointly put forward plans to link Canada bosses’ pay to staff diversity, as the regulators said increasing diversity within firms could help spur innovation and improve decision making within companies.
In April, the UK’s Financial Reporting Council (FRC) also brought in new rules requiring listed companies to disclose the levels of ethnic diversity on their boards, as the FCA separately said firms should have at least one board member from a non-white ethnic minority.