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Arts organisations that can't improve the diversity of their workforce will face funding cuts, Arts Council England (ACE) has warned.

The caution from Chair Nicholas Serota comes as the funder releases its annual diversity survey. Serota says the data reveals "a disappointing picture": 11% of the workforce at National Portfolio Organisations (NPO) are non-white, compared to 16% of the working age population, and disabled people make up just 6% of NPO workers, despite being 21% of the working age population.

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Under ACE's new strategy, "organisations that receive regular investment from the Arts Council will need to set themselves stretching targets for representation in governance, leadership, workforce, participants and audiences," Serota says.

"Failure to meet these targets will have an impact on future funding."

Check back later this week for analysis of Arts Council England's diversity data.