Can we do more on gender diversity in financial services?


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23rd March 2021

According to the management consultancy firm Oliver Wyman, the percentage of women in financial services leadership roles is still below 25% globally, despite improvements over the last 20 years. Over that time, and especially recently, we have seen a growing awareness of the issue, along with strong business cases for increased inclusion and diversity in the workforce. Mindsets are clearly shifting, but levels of diversity on boards and in senior leadership roles are still far too low.
In our latest episode of On The Money, we asked a panel of expert speakers to give us their latest thinking on the state of gender diversity in financial services. You can watch the full episode – including contributions from Aegon, Silicon Valley Bank and Women in Banking & Finance – by clicking here.
According to Melanie Seymour, Advisory Board Member at the organisation Women in Banking & Finance, the question is no longer about whether you can afford to have – or not to have – a diverse workforce. Prospective clients and employees are looking for companies to set a much higher bar when it comes to gender diversity.
“I think of it through a different lens,” Seymour says, “and it brings me back to a conversation I had with my children about 10 years ago. I have 2 boys that are now 23 and 21. I can remember being very passionate about diversity and why I was doing so much, and the boys both looked at me and said ‘why do you do this?’
“To start with I was horrified, because I’d walked up to 2 boys that just don’t understand this – this is awful. But what they were actually saying was ‘we would never work at a company where it wasn’t diverse because our friends are diverse. We have friends that are female and male, friends that are different colours, friends that come from different backgrounds – so why would we work somewhere were that wasn’t there…?’
“It sort of gave me hope for the future. I don’t think we’ve got there as fast as we thought but when I look at it now, I think it’s not just [about] what are the benefits of a diverse workforce, it’s what are the expectations of a workforce more generally? So if you look through the lens of candidates, it’s amazing now… the questions you get on the diversity of your workforce and what you’re doing as a company to promote diversity. For a candidate perspective and to drive the best hiring results, it’s becoming a necessity.”
Despite positive strides being taken and ambitions being shared across entire industries, many businesses still struggle to close the gender gap. In 2010, this was reflected by the foundation of The 30% Club – a campaign group formed by business leaders that seeks to achieve 30% female representation on the boards of some of the largest companies in the world.
According to a report from IBM published earlier this month, the number of women in senior leadership roles has barely moved despite a general increase in the amount of awareness around gender diversity. “The sobering reality is that executive boardrooms and C-suites around the world look essentially the same as they did 2 years ago,” the report laments.
So should we be incentivising businesses to do more on gender diversity in the workforce? Should executives’ performance pay be linked to the number of women given executive roles? That’s a possibility mooted by some – including Sonya Iovieno, Head of Venture & Growth at Silicon Valley Bank.
She tells MoneyNext: “When I look across financial services at entry level, grad schemes have come a long way – and by and large I think that companies are doing a much better job than they used to in terms of making sure that there’s good gender balance across grad schemes. But I think that the challenge comes really in the way that it always has in the past, which is as women begin to move up the career ladder.”
And she believes that it’s possible to accelerate the progress that financial services have made towards greater gender diversity.
“I thought The 30% Club is a great starting point in terms of companies making very overt commitments as to the number of female board members they were going to have, but of course initially that is very focused on non-executive board positions and it became quite clear that there’s a limited amount of influence that a non-executive can have on the entire culture of a company.
“So I think it’s really important to look at the senior board positions, and in that aspect for this to be front-and-centre of every CEO and executive board member’s goals on an annual basis, tied into their bonus in terms of appointing women to a certain percentage of the roles – at least 50% of the roles that are going to be appointed in any given year.
“In that way you might start to see a little acceleration in the number of roles, but also you get a halo effect of role models for other women in the company that can look at what is possible, that can go to those people for mentoring and advice, and it has… a halo effect across the company first and then hopefully in the longer term the financial services industry.”
To find out more about gender diversity in the workforce and how we can improve it, catch up on demand with the latest episode of On The Money: Gender Diversity & Inclusion in Financial Services. Click here to watch the full episode now.