PwC releases its first-ever diversity report

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Yesterday afternoon, Tim Ryan, PwC’s U.S. chairman and senior partner, shared the results of the firm’s first-ever Diversity & Inclusion (D&I) Transparency Report in a live webcast with its 55,000 U.S. employees. It was a promise kept: Ryan had pledged full transparency as part of six new commitments to accelerate PwC’s goal of racial equity in the aftermath of George Floyd’s death.

While the firm has made headway in some areas, the news is mixed.

Women and racially diverse talent now account for 65% of entry-level hires, 7% of whom identify as Black, 12% as Latinx. It’s an improvement from previous years. Although Black and brown partners are still underrepresented—at just 2% and 3%, respectively—racially diverse partners have increased by 8% over the last three years, and PwC’s current partner class is nearly 50% women or racially or ethnically diverse leaders.

But in the spirit of transparency, the firm has parsed its numbers in some commendable ways. For example, one way to gauge opportunity within the firm is to look at the people who get the juicy gigs—people with leadership roles on PwC’s Fortune 500 accounts. It’s some of the most high-profile and complex work they do. From this perspective, barriers emerge: PwC worked with 468 of the Fortune 500 companies during the 2020 fiscal year, but only 19% of those accounts were led by women or racially/ethnically diverse partners, and only 25% of the firm’s 20 largest audit accounts by revenue were led by women or racially/ethnically diverse partners.

Ryan has been unusually forthright on the subject of race and has encouraged the firm to confront difficult issues early in his tenure—including candid conversations about police violence and the criminal justice system. Part of that work includes Ryan’s CEO Action for Diversity and Inclusion, an alliance of some 1,200 CEOs who are working collaboratively on inclusion issues in their workforce. 

While Ryan’s team had made a commitment to being open with the numbers, plans to release them publicly were accelerated by recent events.

“The decision to share our data had been planned, but the events around George Floyd’s killing boosted our desire to get this data out there and start sharing our plans earlier,” Ryan tells Fortune. “We aim to be a leader on diversity and inclusion, and the data tells an important story.”

Part of that story has been the frustration of some Black employees who felt they were denied opportunities to advance—which includes the kinds of assignments that get them in front of important clients. Over the last two years, Ryan’s teams have been using data, surveys, and employee feedback to help redesign their systems to address barriers and bottlenecks throughout PwC’s talent pipelines. 

Shannon Schuyler, the firm’s chief purpose and inclusion officer, says they’re aiming to move faster from here. If PwC’s stated goal is to make sure that 50% of partners in the U.S. market are not white men, it means, in part, a better early pathway through the firm and an improved recruitment strategy.

“We know that our focus is going to be on our Black and Latinx and women [talent] at various different levels,” says Schuyler. With the data, she says, they better understand where people get lost or excluded. “There’s been a series of programs, intentional and targeted interventions, that really allow us now to look at the full complement of our people’s journey.”

Fortune has been following the firm’s inclusion efforts—which span two decades—and will be reporting on some of the ambitious interventions PwC has been developing since Ryan took the helm in 2016.

But full transparency is a good first step, though Ryan shares the data with all the usual caveats. “We know we are not where we want to be yet,” he says. He sees full representation as both a competitive advantage for the firm, and part of building an anti-racist society. “When you look at where we’re trying to head for representation overall, which you’ll see laid out over many different pages, [we’re not focusing] on just our partners. We’re really focused on looking to be aligned with the U.S. workforce.”

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