The G Word

There’s a major problem with governance and oversight of institutions and employers in the UK at the moment

Sir Ed Davy struggled with governance at the Post Office

Last summer a manager at Amazon UK leaked a new internal management training programme to The UK’s Free Speech Union. The programme had been developed by Amazon USA’s LGBTQ Employee Advocacy Group. Someone in Amazon USA decided to authorise the course for immediate global distribution to every other nation. The problem was that the content of the course came very close to and may have crossed the line into unlawful under the UK’s Equality Act 2010. It was certainly controversial and was clearly causing discontent at Amazon UK to the extent that one of the managers thought it serious enough to risk their career by leaking it to the FSU.

At the time I commented on a LinkedIn post that you had to sympathise with the HR Director of Amazon UK because the first thing she was likely to hear about the programme, was when the Free Speech Union published its existence and social media pickled it up. At a time when Equality Diversity and Inclusion was increasingly under the microscope, with multiple employers losing employment tribunals for discriminating against Gender Realist employees, the last thing she would have wanted was the implementation of a potentially unlawful programme which, for whatever reason, had failed to cross her desk for approval.

Anyone who has ever worked in a large complex organisation will understand that the norm is that the head doesn’t know what the tail is doing. Global organisations compound this especially when national management teams are folded into international ones - exposing the company to the risk of inadvertently breaking local laws. Add digital communications and social media to the mix and you can end up with a scenario where the conduct of a single marketing manager in one country can crash the share price and sales of a global business the Bud Lite fiasco being the best example of this recently,

I mention the HR Director’s frustration with this because over the last year, the HR sector in the UK has started to row back on the more radical implementation of EDI (that’s DEI in the UK for our American readers).

Following the publication of the Cass Report in early 2024, and the subsequent thaw in the moratorium around discussing ‘gender’ policies and their implementation in the workplace. Discussions started on LinkedIn with in some in the HR Community like Simon Fanshawe, Tanya de Grunwald and Lynn Killick and others leading the discussion. By June 2024 these discussions were becoming increasingly open with UK employers and executives being directly challenged to explain EDI policies that risked discriminating against their own employees and customers. Employers who had blindly implemented advice from third parties like Stonewall, who notoriously were suggesting employers to essentially ignore the law, were being publicly called out. Yes, the majority of dissidents were independent consultants in the HR community but they were taking a significant risk in their employability by speaking out.

In April I published a series of articles about How Work Went Woke in the Daily Sceptic and explained how uncomfortable I was as an HR professional, at the politicisation of the workplace and the implementation of ideologies that over reached significantly into the lives of their employees and the phenomenon of how fear made management teams implement policies that none of them agreed with individually. I was bowled over by the response I got from the HR profession with dozens of individuals reaching out to me thanking me for speaking out but also voicing their concerns. But, as always, these were either independent consultants, retirees or soon-to-be-retired whilst those who were working in larger employers, or supplying services like recruiters, lent their support privately but not publicly.

By the summer of 2024 we were starting to see this discussion filter through to HR Departments in many UK FTSE100s and 250s started to realise that there may be a problem with how EDI has been deployed into the UK workplace, evidenced by this study by the Free Speech Union in March 2024. In particular the ‘zero tolerance’ implementation of quite radical and often unlawful EDI after the death of Geoge Floyd had created some real issues. Debunked methodologies like unconscious bias training were purchased by HR teams, driven on by CEOs desperate to prove their organisation wasn’t racist and on the back of this came the whole suite of EDI shibboleths, in particular LGBT rights. Bemused employees were summoned for training (re education) courses where they were essentially told that they were incorrigible bigots (unconscious) who needed to be morally reprogrammed by their HR departments. Adding petrol to the fire was: huge demand for such material and training created an industry that boomed when just about every other was in lockdown driven recession, recruitment and management consultancies saw a life raft and jumped on it offering training in EDI from everything from ‘allyship’ to ‘anti racism’ and beyond. There was a huge demand for EDI ‘professionals’ and as a result many activists with little or no training in Employment Law, Equality Law and employee relations were hired and given budgets.

The consequences of this took a while to filter through but they appear to have been quite catastrophic especially for productivity. For decades the Holy Grail of HR was Employee Engagement - how to motivate and engage your employees so that their productivity flourished. In the space of a few months we’d gone from that to essentially telling our colleagues they were morally flawed and the only thing that could save their sorry souls was a training day with a blue haired activist on how to recognise straight white male privilege or some other nonsense. As such the gap between EDI Policies, typically well written and lawful and EDI training started to emerge. When you are training a workplace policy to your people, you need to make sure your training reflects and is based on that policy. In many cases this simply didn’t happen. Last year Thames Valley Police lost a high profile Employment Tribunal when they were found to have racially discriminated against several employees. The senior leadership team had ignored the Service’s obligations under the Equality Act 2010, ignored the advice of their own HR team and in house lawyers and discriminated against three white male officers when implementing a policy they had drawn up on the hoof to create racial diversity in their senior investigation teams. At the time a contact at TVP leaked their Equality Diversity and Inclusion training slides to me. The programme bore no relation to TVP’s EDI Policy, seemed to have been cribbed from an American DEI ‘Guru’ and included controversial theories like Critical Race Theory and radical gender theory. To add insult to injury, TVP’s EDI Policy specifically warned employees about the necessity to ensure that any EDI initiatives or training followed UK law, especially the Equality Act 2010.

It takes a while for the wheels of justice to turn and by 2023 we were starting to see hundreds of incidents filtering through where employers had essentially ignored their legal obligations and discriminated against employees. In the most egregious cases, those employees who had been punished were only pointing out that their leadership teams were in danger of breaking the law. This created an atmosphere of fear around speaking out that compounded the situation.

HR people found themselves caught between their obligations to ensure their employer didn’t break the law and delivering employee engagement strategies to maximise productivity, and demands from their boards, employee advocacy groups and the new EDI teams to implement increasingly radicalised and political policies. Unfortunately, many HR people were caught up in this and became activists seeing the purpose of Human Resources being to lead social change. This was hardly surprising when the Chartered Institute of Personnel Development, the CIPD seems to be rather confused about the purpose of HR. In December 2024 as part of a post discussing this Tanya De Grunwald added the following:

In response to several articles in the UK national press putting the spotlight on the HR industry, the CIPD seems to have doubled down, re iterating their commitment to DEI and spouting the usual, now debunked, claims.

It seems extraordinary that an organisation which claims to lead and mentor the HR industry in the UK, seems to be so unable to read the room. But as already mentioned, the market seems to be leaving the CIPD behind.

The more I investigate these cases, it becomes increasingly apparent that there is a major issue with governance across our institutions, companies and employers.

A good yardstick is to look at the structure of the organisations which are breaking the law here. It is almost universally either: a public sector employer, a Privately owned company, a Third Sector or a foreign owned company operating in the UK. It is rare to encounter a company traded on a UK Stock Exchange. It was happening and there are some very questionable actions by some PLCs over the last few years, but unlike the other structural models, PLC’s are heavily audited for risk by mere fact that they are publicly traded. Last PLC I worked in you literally had to risk analyse everything you did. I was in charge of Workforce Deployment so if I introduced any policy or process I would have to justify it to an internal risk committee but also to external auditors. This included fiscal risk, opportunity cost risk, legal risk, PR risk. Without a green flag on all then it didn’t happen. Even if the leadership team were in full groupthink mode, they could come up hard against a long nosed auditor asking them ‘why’?

So why don’t the other structures have this level of governance? I suspect that this has happened simply because it has. A really good example is the current Post Office Scandal. The Post Office was hived off as a State owned company with a single shareholder - a junior government minister. Most famously, during the worst parts of the scandal this role was filled by Sir Ed Davie, now leader of the Liberal Democrats. So Sir Ed was effectively the owner of the Post Office and was responsible for overseeing the executive and non executive team who ran it. Unfortunately for Sir Ed, both the Chairman and the CEO were locked into a groupthink culture that elevated the reputation of the Post Office beyond any other consideration, including basic justice. Sir Ed looked like a rabbit in the headlights when he was called to task about this last year. I have some sympathy for him. He had his day job, his role as an MP and was also expected to ‘own’ the Post Office. It was all far too easy for the management to pull the wool over his eyes. In other words the governance model was not fit for purpose and no one was overseeing the minutiae. Had the leadership team had to answer to an external risk auditor acting on behalf of the owners (i.e. us) with a remit to look under every stone and question every decision, then I doubt it would have escalated to the level of scandal it has.

We see the same issue in Police Services, the Police and Crime Commissioner is meant to oversee performance and governance but seems to be strangely toothless. We see it in NHS Trusts where again, the Trustees are often regular members of the public who lack the insight and expertise to spot shenanigans.

But it isn’t just the external governance that is the issue, above I described the situation the HR Director that Amazon found herself in when a policy designed for the USA was deployed globally. As HR Teams are winding back on EDI in the largest of our PLCs, it is still full speed ahead in other departments, in particular Marketing and Communications and also Procurement. HR teams are removing EDI training that is causing division in their own workforce whilst at the same time, their colleagues in procurement are insisting that small business suppliers implement the same on their employees to have a chance of winning a contract. They call this ‘sustainable procurement’ and it doesn’t take a huge leap of imagination to think how such policies favour larger suppliers and penalise small businesses. So much for ‘inclusivity’. Meanwhile the creative sector seems to think that its purpose is to change the world one advert at a time. As such they are increasingly removed from the opinions and lives of their core customers. In the USA, Robby Starbuck has been leading the push back against ‘woke’ EDI policies and every time his searchlight crosses another business, they can’t U turn on this fast enough.

America sneezes and we die of diphtheria, such is the cultural impact of the USA on the world, especially the Anglosphere. Those of us in this debate are predicting that this U turn will also happen in the UK. It won’t be as obvious because the Equality Act 2010 actually prevents some of the more radical policies Starbuck and his team expose. However, the Labour Party has declared that EDI is on their agenda and have announced plans to demand that any public sector procurement makes it mandatory. In an interview in The Telegraph over the summer, Annalese Dodds, ‘Equalities Minister’ reiterated the commitment but repeated the McKinsey Report that DEI is essential for business growth - a report that has been thoroughly debunked as nonsense and lacking in even the most basic empirical evidence to support its claim.

I have some hope that the rapidly unfolding economic crisis will force Labour to drop some of its more ideological motivated policies and cost pressures will force the dismantlement of expensive EDI departments within the public sector. Either way, we do have a major issue with governance in many of our institutions at the moment. A good yardstick is to ask: who are you responsible to and what tools do those people have to measure your performance?

If you think you have a governance issue in your business or have a leadership team that lacks diversity of opinion, get in touch. We can help.