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Diversity and inclusion best practises

Removing Hiring Biases from Talent Sourcing

By Fintros — June 2017

People are attracted to others who are like them. Unfortunately, that means unconscious biases can lead managers to exclude highly qualified candidates or elevate weaker ones. This is harmful for the candidates who are excluded, can also lead to a lack of diversity, new ideas, and talent within corporations… and open up legal pitfalls.

Why diversity matters

In 2015, McKinsey & Company studied more than 350 large public companies and found that those in the top quartile for gender diversity were 15 per cent more likely to produce better returns than their local peers. Companies in the top quartile for racial and ethnic diversity were even more likely to do better, the consultancy found.

Worse still, biases in hiring and salary decisions can lead to discrimination against minorities and women. Even if the biases are unconscious, this can still be a legal liability for a firm. Several Fortune 500 companies - including HSBC, Deloitte, and KPMG - have started to anonymize resumes in order to dampen these biases, stripping out names and identifying information before they are presented to hiring managers.

What biases are common

One of the most oft-cited studies found that candidates with “black-sounding” names, such as Tyrone or Aliyah, were 50% less likely to receive calls for interviews than candidates with equivalent experience but “white-sounding” names, such as Jonathan or Claire.

A 2011 study looking at the Canadian cities of Toronto, Montreal, and Vancouver found that resumes with English-sounding names were 35% more likely to get call-backs from employers than resumes with Chinese- or Indian-sounding names, despite having identical qualifications and experience. This replicated earlier findings by the Organization for Economic Cooperation and Development (OECD) and UK Ministry of Labor.

Multiple studies have found that male hiring managers will typically favour male candidates. And this can also lead to biases in salary decisions, the most-discussed salary discrepancy being between men and women. Many jurisdictions have passed equal pay legislation to confront this.

Salary discrepancies exist even within genders based on things such as weight and height. A study by academics at the University of Florida and the London Business School of Business found that “very thin” women earned approximately US$22,000/year more than their average weight counterparts, while “heavy” and “very heavy” women lost around US$9,000 and US$19,000, respectively. German researchers separately found that the abilities of overweight individuals are underestimated and those of ”normal-weight” ones are overestimated.

For more than a century, it’s been repeatedly noted that taller men make higher salaries and occupy more leadership roles. New York University professor Enoch Gowin in a famous 1915 study found that executives were taller than “average men,” that bishops were taller than preachers, and that sales managers were taller than the salespeople reporting to them.

In 1995, the Economist found that 90% of Fortune 500 CEOs were of above average height, while fewer than 3% were below 5’7”. The magazine this year also found that of America’s 45 presidents, only six have been of a below-average height. Evolutionary psychologists speculate that the preference for height may stem from aptitude in hunting or combat, though height would doubtfully provide much advantage at a desk job or on a trading floor.

It’s not just the hot-button issues of race, gender, ethnicity, and body type that can cause bias issues. For instance, people also have a tendency to favour individuals who went to the same school as they did, support the same sports team, favour Star Wars over Star Trek, and multiple other factors wholly irrelevant to work. (Even without considering biases, career consultants strongly advise candidates against naming their favourite sports teams or sci-fi franchise on your resume.)

Fintros can help

Use Fintros to hire the right candidate at the right time. Book a demo with a Fintros White Knight to see how Fintros can integrate with your ATS and instantly simplify your talent pipeline.

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