Investing in diversity and inclusion is not just the morally right thing to do for The Co-operative Group (Co-op), it is a “catalyst for growth”.

That’s the perspective of Zahoor Ahmad, who leads the diversity team at the £11.3 billion-revenue British retail giant.

The reason behind this is that diversity of perspectives, ideas and solutions are essential in helping businesses “to navigate the complex challenges we all face each day”.

At the end of the day, “nurturing fresh and unique points of view…can drive innovative thinking within an organization”, shares Ahmad.

Plus, because Co-op is a community-led retailer (it is owned by its 5 million members), its 57,000-strong workforce needs to “be reflective of the communities we serve”.

This community-first approach explains why Co-op’s tagline is ‘Owned By You. Right By You’, and also why when the retailer talks about diversity, equity, inclusion and belonging (DEIB) it has a strong focus on often overlooked element of social mobility.

In fact, Ahmad does not have a classic Head of Diversity title, instead his role is Head of Social Mobility, Inclusion and Belonging.

He tells UNLEASH: “Referring specifically to social mobility and belonging in my title is indicative of the significant focus we place on these factors when building a workplace culture that is diverse, fair and empowering to all.”

Co-op takes ‘bold action’ on social mobility

For Ahmad, “the fact that social mobility is often overlooked and too few employers are willing to hold themselves accountable is what motivates Co-op to draw attention to it.”

Socio-economic background is proven to have an impact on individuals’ ability to progress at work.

In fact, data from KPMG shows that social class was the biggest barrier to career progression within its own workforce, compared to other types of diversity like gender, ethnicity, sexual orientation and disability.

The issue is that many employers often overlook this fact and the impact on people’s careers; this is not just bad for the individuals, but the business as a whole, as McKinsey argued in a 2023 article.

The KPMG report found that individuals from lower socio-economic background take 19% longer to progress to the next grade, compared to those from higher socio-economic backgrounds.

After an initial push from its members in 2021, Co-op made a swathe of social mobility commitments in 2023. “We want to take bold action towards offering equal opportunities for progression within our organization,” Ahmad shares.

The commitments include creating a social mobility taskforce, rethinking internal mobility to ensure all Co-op employees can see how their skills may suit a lateral move or a promotion, redesigning financial wellbeing to help with financial resilience, and mentoring opportunities.

However, the core of the social mobility plan is to collect data and publish a socio-economic pay gap report, which happened in July 2024, making Co-op the first retailer in the UK to do so.

Data collection is essential to social mobility progress

As the saying goes, what gets measured, gets done – and this particularly refers to DEIB.

“Data collection is a key tool within our wider diversity strategy, as it demonstrates our ambition to ensure employee voices are truly heard,” adds Ahmad.

He adds: “It is my strong belief that we shouldn’t shy away from such data. Instead, analyzing it can enable businesses to implement targeted and focused initiatives that make a real change to their workplace culture.”

Co-op’s socio-economic pay gap report collected voluntary data from 48% of its employees, and it found that there is a 5.2% mean pay gap between colleagues of lower and higher socio-economic background.

The data showed that the mean pay gap was even larger (9.8%) for women from lower socio-economic backgrounds.

Plus, colleagues from lower socio-economic backgrounds were less likely to progress to more senior positions within Co-op.

Across the company’s food stores, the proportion of people from lower socio-economic backgrounds sat at 39% for professional jobs, compared to at 47% for lower level jobs.

The plan is to report on this data annually, and to increase the collection rate to 80% by the end of 2025.

Ahmad states: “The publishing of our pay gap report holds us to account, and motivates everyone throughout the business to enact true, tangible change”.

The great news is that progress is already being made. For instance, the voluntary completion rate for socio-economic background has risen to 72%, so the retail giant is close to that 80% target.

Plus, the retailer is looking specifically into the intersectionality of gender and socio-economic background found in the 2023 pay gap report.

“At Co-op, we already have specific development programs designed to address under-representation of women and ethnic minority colleagues in our leadership population,” notes Ahmad.

He continues: “However, we recognize that our colleagues are always more than a single characteristic, and that intersectionality can often compound disadvantage.

“This is why later this year, we will launch our first career development program specifically for lower socioeconomic background colleagues, targeting business areas where our data shows there are additional barriers to progression.”

For Co-op, “we know we’re doing our job as an employer when our colleagues feel empowered to bring their true, authentic selves to work”, states Ahmad.

Driving DEIB progress beyond Co-op

The fact that socio-economic background plays a “huge part in determining your future success in life and at work” is simply not fair, according to Ahmad; “putting this right is something we must all work together to achieve”.

Progress around social mobility within Co-op isn’t enough for the retailer; in line with its community-first approach, it wants to spur action from other employers.

Ahmad’s top tip for other companies unsure where to start with social mobility is data.

He shares that “employers should be asking their employees to share information about their socio-economic background This will support understanding of the diversity in your workforce as a whole and at various levels within it.”

“Only then can you fully appreciate the strategies needed to address inequality in a way that is unique to you”.

Stay tuned, as top of Co-op’s list for 2024 is to “deliver practical support for other businesses to use within their organizations later this year”.

However, businesses cannot do it alone; there needs to a partnership with governments and wider society.

Talking about the pay gap report, Co-op Group CEO Shirine Khoury-Haq commented: “By holding ourselves accountable and outlining the steps we will take to address inequality within our business we hope to inspire long-lasting change at a societal level, so that everyone can thrive no matter their background.”

In fact, a few of the retailer’s social mobility commitments are societally focused. This includes campaigning for socio-economic background to become the 10^th protected characteristic under the 2010 UK Equality Act, as well as for the enactment of Section 1 of the Equality Act, aka a public sector to have a regard for inequalities around socio-economic background, which is a manifesto promise of the new British Labour Government.

By making these changes, the UK would start to catch up with its peers in Europe; France and Germany, for instance, already legally protect socio-economic background in the workplace.

As part of this societal push, Co-op is working with multiple partners “who share our passion to deliver real change” including the Social Mobility Foundation, New Future Network, Working Chance, Making the Leap, and The Tent Partnership for Refugees.

Ultimately, “collective action from businesses, government and communities is crucial in driving systemic change for workplace equality, and we’re committed to playing our part as an advocate and partner,” concludes Ahmad.