Uncategorized » Sexual harassment is a board level issue

Sexual harassment is a board level issue

Boards need to make the issue their priority, say Beth Hale, partner and general counsel and Harriet Riddick, associate at law firm CM Murray.

A 2018/2019 report by the Banking Standards Board (BSB) published last week shows that only 53% of bankers with concerns about sexual harassment chose to report them, and of those who did, just 57% said they were listened to and taken seriously.

These figures suggest that there is a substantial number of employees who still – over 18 months since the start of the #MeToo movement – feel unable to speak up about sexual harassment; and, for those who do, their concerns are not always appropriately responded to by their employers.

While disappointing, these findings are not entirely surprising. They corroborate what we already know about sexual harassment in the workplace, which is that: (1) it is inextricably linked to culture; (2) tackling the issues requires a cultural change within an organisation; and (3) cultural change takes time, perseverance, and – importantly – buy-in from the top. In other words, merely amending HR policies and documentation is not enough to instigate meaningful change.

There are plenty of strong reasons why directors should not eschew sexual harassment as “just” another HR issue. To name a few:

It is a commercial (and therefore financial) issue. If companies fail to implement the right workplace culture, they will struggle to attract and retain top talent. There is also a serious risk of negative media coverage and long-standing reputational damage and, increasingly, they may find that their clients will not do business with them.

There can also be regulatory implications. Financial services firms will be aware that the FCA (in its letter to the Women and Equalities Committee in September 2018) expressly invited individuals to raise sexual harassment issues with it directly, expressing a particular interest in reports that indicate a firm is “systematically mishandling allegations or incubating a culture of sexual harassment”. In the current regulatory climate, financial services firms will want to do everything they can to avoid being the subject of this type of report.

Sexual harassment – above all – harms victims. Any organisation that values its employees should not tolerate it.

So how can the Board make tackling sexual harassment its priority? We have set out five ideas below:

  1. Walk the walk

Set an example. Consider reviewing your directors’ service agreements in relation to how sexual harassment and breaches of related policies are treated. Ensure that your company is, as far as possible, not in a position where it would be obliged to pay a senior executive accused of sexual harassment large pay-outs in a severance package. Also, consider the make-up of your board room. Is there an equal representation of males and females? Sexual harassment goes both ways, but equal representation in director positions can engender an environment in which all employees feel safer and empowered to speak up.

  1. Start the conversation

Mark Carney (the governor of the Bank of England) commenting on the BSB report said “creating sound cultures” requires “leaders who are prepared to ask uncomfortable questions and more importantly, are prepared to listen to uncomfortable answers”.

Conducting a company-wide cultural audit would be one way to do this. These could involve staff surveys and interviews with key personnel, to draw out the cultural issues from the perspectives of those on the ground. Be prepared and willing to listen to uncomfortable findings. This will allow you to implement bespoke and meaningful changes to improve conduct, culture, and diversity within your business.

  1. Maintain (and adhere to) a 21st-century sexual harassment policy

Many businesses have recently re-evaluated their sexual harassment policies in response to the #MeToo movement, but it is no good if it is just gathering dust on a shelf. Businesses need to embed fairness and respect within their culture, which means adhering to the policies in practice, as well as providing proper and regular training to employees of all levels.

Meaningful training (and not just as a tick-box exercise) can not only reduce the likelihood of the misconduct taking place; it can engender an environment where both victims and witnesses of harassment feel able to come forward knowing that they will be supported, and effective action will be taken.

  1. Consider reporting lines

In many cases, employees’ reluctance to speak up stems from a fear it will be held against them. In the BSB survey, this was indeed the most common reason given by employees who had wanted to raise a concern but chose not to.

It is vital that organisations have in place clear and effective reporting procedures, and that reporters feel confident that they are not going to suffer any negative impact as a result of coming forward.

  1. Ensure that there is just as much focus on listening up as speaking up

The second most commonly cited reason for not raising concern in the BSB survey was the sense that nothing would happen if they did. There has been much focus on the importance of speaking up, but this is just one side of the story.

If employees’ concerns are not listened to and acted on, not only does this defeat the point in the individual making the report but it may dissuade employees from doing the same in the future – proliferating a culture in which sexual harassment is tolerated.

One practical way to prevent this would be to appoint a sexual harassment reporting officer from senior management, responsible for overseeing and ensuring the consistent handling of sexual harassment reports, and to act as a single point of contact and accountability.

The causes for sexual harassment are complex and deeply ingrained, and (sadly) there is no “quick-fix” to eliminate this type of behaviour. By making it their priority, Boards can ensure that they encourage a culture in which harassment, be it by staff or by third parties, is clearly understood to be unacceptable. Over time, this will create an environment where people both speak up and are heard.


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