Women are held to higher standards across the financial services industry, than their male counterparts, according to new research.
A new Women and Banking and Finance (WIBF) with the London School of Economics (LSE) report, found that women struggled if they did not perform consistently well. This was compared to what they recognise as average performing men in the City of London, who are surviving in financial services in high numbers, for a number of different reasons, including social norms, retention bias, and a difficulty among women, especially black women to gain recognition on their performance at work.
The idea that women need to sink or swim, but men have many more opportunities to survive in financial services raises two problems for women. First, they are being held to higher standards – either ridiculed or celebrated, with fewer opportunities to drop the ball than men. Second, it was emphasised that below-average men often survived because they played ‘good politics’, bringing this ethos into their management approach as gatekeepers to opportunities for emerging talent. It was said that emerging women were less likely to get opportunities under these leaders, and often had their progression blocked.
Based on the findings, WIBF and the LSE have created the GOOD FINANCE framework to help bring inclusivity to financial services firms. The framework is comprised of actions that a company can take to ensure that they retain and develop their most talented employees, including women.
Speaking about the report, Dr Grace Lordan, Director of The Inclusion Initiative at the London School of Economics said, “Having the opportunities of talented women guarded by managers that favour people ‘like them’ and play bad politics is detrimental for financial services in terms of innovation.”
“The final gender convergence will only come when financial services have managers across all levels of seniority who embrace an inclusive leadership style that ensures the voices of all talent are heard because they are certain it is better for their own objectives.”
“Until this point, we are stuck in a compliance phase where we need to continue monitoring and auditing the progress of women in the sector to ensure progress actually happens”
Anna Lane, President & CEO, WIBF added, “Diversity and inclusion remains a significant issue in financial services and it can be difficult to identify the success of D&I programmes.”
“Although some initiatives have clearly delivered others need rethinking; this was a key driver behind the Good Finance framework and we are delighted that WIBF can be in the driving seat for these discussions from the Accelerating Change Together research.”
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In this study, suggested actions for firms to take to reduce the headwinds relayed by the women are identified. Equally valuable is information on tailwinds and ways in which they can be replicated or artificially constructed by firms to improve the growth and retention of women have been recommended. This has clear merit given that the first year of the WIBF Accelerating Change Together Research Programme is focusing on the “Missing Middle”. Reducing headwinds and augmenting tailwinds can help retain talent in the industry at this key vulnerable point in a woman’s career.
The study has strategically targeted women who are working in areas that have a high proportion of men, as well as those that have more gender balance but have what appears to be a glass ceiling.
Women earn two-thirds less tham men in top finance roles, according to new research.
The research, conducted by Fox & Partners, found that the pay gap between male and female directors at FTSE 350 financial services firms currently stands at 66 per cent. The report found that the average pay for female FTSE-350 financial services directors is just £247,100, while the average pay for their male counterparts is £722,300.
The findings suggest slow progress is being made in promoting women to senior, higher-paid executive roles. While there is a broad consensus about the importance of increasing gender diversity in the financial services industry, this is yet to be reflected at the most senior level.