Social mobility

Posted on January 25, 2019 · Posted in Accounting & Business

Countries and regions with poor social mobility are also more prone to corruption, or at least the perception of corruption, according to analysis undertaken by ACCA.  These findings – from the report ‘Purpose and the profession: Social mobility and the public sector’ – were unveiled at ACCA’s Public Sector Conference, which took place at Church House in London in November.

 

The conclusions are particularly relevant to the public sector because social mobility is central to how it operates.  Positive social mobility is not only a sign that the system of government is fair, but having a recruitment system based on equality is also a way of achieving fair outcomes.  Societies in which members of an influential family have the best chance of obtaining the top jobs in government have low social mobility and are more likely to be corrupt.

 

However, there is a much higher level of social mobility in the public than in the private sector.  The report highlights the fact that 80% of the public finance professionals questioned came from comparatively disadvantaged backgrounds.  The results were obtained from a survey of more than 13,000 ACCA members and students in the public and non-public sectors.

 

Of the 20 countries analysed, Denmark scores best both in terms of strong social mobility and low levels of corruption.  At the other end of the scale, South Africa performs poorly on both.  The UK was in the top half of the surveyed countries on corruption, but in the bottom half on social mobility.

 

ACCA obtained the conclusions through analysis of Transparency International’s Perceptions of Corruption Index, comparing these with OECD data on intergenerational social mobility.  The results, both from 2017, show that as perceived corruption rises there is a corresponding drop in intergenerational social mobility.

 

The views on corruption were perceptions, not objective assessments.  So if parents believe their children were treated unfairly and not given a chance, they might interpret this as meaning that the system is corrupt.  The study concluded that the score for the perception of corruption is a test of the level of trust toward government in a society.  It explained: “countries with limited social mobility exhibit lower levels of trust”.  The report added that structures ensuring fairness and equality are important.  “Elite families or groups will be better placed to pass on their privilege to the next generation when a society’s norms do not impose clear rules for fair competition,” said the report.

 

The research explained that some individuals benefit from an ‘entrenched advantage’ from early childhood through to school years, where they are able to present themselves as more work-ready than their peers.  In response, some public sector employers have taken affirmative action in selecting candidates from more diverse backgrounds for hiring or promotion. For example, by offering guaranteed interviews to applicants from disadvantaged groups, an otherwise exceptional candidate from a disadvantaged background, who might otherwise have been sifted out at the application review stage, could be offered the position.

 

Alex Metcalfe, head of public sector policy at ACCA, commented: “ACCA’s work has demonstrated that countries facing higher levels of corruption also experience lower level social mobility. It is now important to think about how to address this relationship, and to explore how it has developed. For example, nepotism can mean that elite families or groups in that country are better placed to pass on their privilege to the next generation.

 

“ACCA believes in fair access to opportunities in all sectors, which are supported by a competitive, rules-based society with good governance. Meritocratic hiring, and open applications that are transparent and challengeable, are important prerequisites for developing an effective and trusted accounting profession.  We believe it is crucial to use this evidence to facilitate the open conversations needed to tackle corruption and improve social mobility outcomes.”

 

 

Hubbub

 

To illustrate how the public sector is evolving, and how not-for-profit social enterprises are moving into gaps in service provision, there is no better example than Hubbub.  Founder and CEO Trewin Restorick set up the charity in 2014, recognising as he dealt with what he terms his “mid life crisis”, that he wanted to make a difference – particularly a positive environmental impact.

 

Supported by the investment arm of the Charities Aid Foundation, Hubbub has made innovative interventions that work with the grain of human nature in order to improve living conditions.  What is the worst littering problem?  Cigarette butts.  So why not get smokers to use their stubs as votes for who is the best footballer in the world?  And make the box bright yellow so you can’t ignore it.  For added impetus, stack the odds against Messi by pre-loading it with loads of votes (that is, cigarette butts) for Ronaldo.  The result was a decisive engagement by smokers, and a measurable reduction in smoking detritus on the streets.

 

In another Hubbub litter campaign, the rubbish bin burps every time waste is pushed through the flap.  Bound to be a winner with young children – and perhaps shaping their adult habits for later years.  Then there are the school trips on the Thames, with children fishing plastic waste from the river – which is used to build new boats for future activities.

 

Hubbub works with a range of public and private sector partners to make urban and rural places more attractive.  Trewin Restorick presented Hubbub as a case study at ACCA’s public sector conference.  He has recorded a webinar for ACCA:

https://www.accaglobal.com/gb/en/member/discover/events/global/e-learning/financial-management/social-investment–a-practical-approach-for-investors-and-invest.html