Are you one of the 45% of financial services workers who happens to be a woman? If so, you may be frustrated about how hard it is to reach the top. For International Women’s Day, we look at diversity and inclusion – and how to break glass ceilings.
In the run up to International Women’s Day, the industry has been awash with statistics on gender equality – and the lack of it.
Women make up 45% – nearly half – of the financial services workforce.
However, representation of women on executive committees in major financial services firms globally is much lower at 20%, and 23% on boards. In the banking and finance industry, women still have a glass ceiling to shatter.
But when discussing gender diversity and women at senior level, women of colour are often left out of the conversation.
The Cranfield University FTSE report in 2018 found that among female executive directors, 97% at FTSE 250 – and all 25 at FTSE 100 – companies were white.
Racial dynamics push the glass ceiling even further out of reach for Black Asian and Minority Ethnic (BAME) women.
How diversity makes a difference
The business case for diversity was made in a 2015 McKinsey report. Companies with more gender diversity are 15% more likely to benefit fiscally above national industry medians. For BAME representation, this figure increases to 35%.
Banking and finance is a fast-evolving sector facing new challenges as the world goes digital and tackles global problems like climate change. Financial services need diversity to generate fresh ideas and perspectives, and to lead in establishing innovative trends.
It’s no wonder then that there’s a huge drive to encourage women into the sector and, increasingly, to support diversity and inclusion.
A recent Oliver Wyman report, Women in Financial Services 2020, confirms that "supervisors across the world... especially in the most developed financial markets... are taking gender diversity seriously".
Examples given include the Bank of England (BoE), Financial Conduct Authority (FCA), European Central Bank (ECB), and Federal Reserve (FED) all of which have been "taking an active and visible role" to promote diversity.
- reforming recruitment
- increasing flexible working arrangements
- fostering networks for women and encouraging mentoring.
"In particular, they have set (and publish progress reports on) internal targets for diversity in their own management and board positions."
Shareholders can also change things, through formal voting, investment selection and less formally through conversations.
Carla Antunes Da Silva is Director of Group Strategy, Corporate Ventures and Investor Relations at Lloyds Banking Group. Speaking to the authors of the Oliver Wyman report, she said, “When shareholders shine the light on something like gender balance, there is a new willingness by board members to close the delta in a faster way.”
The report reiterates the need to look at diversity more broadly rather than just in terms of gender, quoting the FCA's Executive Director of Strategy and Competition, Christopher Woolard.
“We need to see gender diversity as part of broader diversity – not just having women, but also having diversity in backgrounds, cultures, ethnicities."
How women help themselves and each other
All well and good then, but women still need to work and network harder. Thankfully there is now a huge number of professional bodies that support women in finance.
Organisations like Innovate Finance, which recently published its in Women in Fintech Powerlist.
Among many other activities, Women in Banking and Finance (WIBF) connects less experienced members with more senior members for one-to-one mentoring.
Mentoring has helped many women throughout their careers.
As they progress throughout their careers, mentees often go on to become mentors themselves. This creates a cycle of women who support each other’s professional development.
Mentoring can also provide networking opportunities, allowing women to build a list of contacts which can be valuable throughout their career. And it’s inspiring.
Embracing your difference
Jagdeep Rai, Regional Director, South and East, HSBC, illustrated the power of mentoring when she recently spoke at one of our REACH events.
The REACH programme encourages people from under-represented groups to come into the sector. Our events give an insight into what it’s like to work in banking and finance, and the opportunities available.
Rai explained that her career started to take off because of “some really good mentors and sponsors and people around me that were fantastically supportive”.
It was through them, she said, that she realised her difference gave her an “edge”.
“I've got an extra element to my background, to my thinking and to my contribution,” she said. “I realised that my difference wasn't the thing that was going to hold me back. It was my absolute edge.”
How we're promoting diversity in banking and finance through REACH