Opening up another conversation about gender pay gaps and opportunity gaps can be complicated and sensitive, perhaps even a tad outdated and tired. And yet, it is International Women’s Day this Friday, 8th March, and until we don’t need to have a day to highlight women’s issues (more noticeable by the lack of need for an international men’s day), then we do need to keep talking about what is the reality for women in the business world. What are the challenges women face? Has the glass ceiling really been smashed? And what changes can be made to bring more women into what have traditionally been men’s arenas?
There’s not been many more arenas traditionally more male-dominated than finance. It sits up there with politics, traditional English sports, and barbershop quartets. Watching The Wolf of Wall Street, women are either girlfriends/wives (not very well treated) or a handful of women who had been accepted into the boys’ club (fancy shaving your hair for a bet, ladies?). But that was the 90s; surely things have moved on in leaps and bounds since then? In many ways, yes. There are definitely more women in finance than there were in the 90s. However, there is still a huge difference between women in finance, and women in top jobs in finance.
A 2018 article in Investopedia noted that women held 9% of senior roles in venture capital and 6% of senior roles in private equity, with only 3% of women holding senior management roles in hedge funds (https://bit.ly/2HfFE3c). An article in The Guardian, updated in February this year, states that ‘fewer than one in seven partners at hedge funds and private equity firms are women, and progress towards equality is slow’. It goes on to say that in the past five years, despite a number of initiatives to increase the participation of women in top finance roles, the percentage of women partners in hedge funds, private equity firms, and other finance services companies, has only risen by 2%. And that was from a starting point of 14% of top roles in these industries being held by women. Shockingly, it found that the average pay gap between what men and women are paid in finance was 22% and 46% for bonuses. To put it into perspective, the average gap for the UK overall is 9.7% (https://bit.ly/2wGg7ce).
But why should most of us actually care about having more women in the top roles in finance, and especially, why should we care whether their bonuses are better or worse than those given to men? Most of us are a world away from being a partner in a top hedge fund and would be overexcited to get a pay raise let alone a bonus.
Well, there’s two very good reasons that we should care. Firstly, as Delphine Traoré Maïdou, Chief Operating Operator for Allianz Africa, said: “Without women at the top, it is very difficult for women at mid-levels to be heard and be encouraged” (https://on.ft.com/2LtBZPo). Within most organisations there’s a trickle-down effect of institutional attitudes and opportunities for personal growth and career advancement. Asita Anche, head of cross-asset quant trading for BARCLAYS confirms this, stating: “In senior meetings there are words that get thrown around like gravitas or confidence where it’s not a tangible measure of anything. ‘She lacks gravitas for this role.’ We need to be cognisant of using language and semantic information to understand if there is a narrative that’s gender biased or gender loaded” (https://on.ft.com/2LtBZPo). Narratives matter. Attitudes matter. And they’re usually set by those in the most senior roles.
Secondly, looking at getting more women into the top roles doesn’t just benefit women. It benefits everyone. Mercer’s global report ‘When Women Thrive, Businesses Thrive’ argues that ‘overly narrow criteria for advancement, outdated leadership models, inflexible working practices and bias in talent management all contribute to a lack of diversity, highlighting a recognised need for improved values and behaviors. Tackling these issues is not just “the right thing to do”; it also benefits the organisation, its employees, its customers and investors’. The report goes on to show that gender diversity can positively impact culture, conduct, and risk; improve customer connections; lead to future growth by embracing new competencies, and lastly, allow organisations to have access to a much broader talent pool (https://bit.ly/2cMrDsE). Nicky Morgan, Treasury Committee Chair, said that greater gender diversity leads to “better financial performance, reduced groupthink and more open discussions” (https://bit.ly/2wGg7ce).
So how can we move this conversation on? While it is absolutely necessary to look at what the reality is and to start by recognising what’s lacking, it is imperative that we bring the conversation into line with the fact that we’re a year away from being in 2020. We need to bring ourselves out of the constant déjà vu feeling of: women’s rights, we’re here once again. Instead of just looking at how we can increase the numbers of women in finance, we need to move the conversation from ‘we need more women in finance’ to ‘we need the right person for the job; and we therefore need to look at (and remove) what blocks women from being equally available for consideration for the job’. And that’s a conversation worth having, for the benefit of men and women.
Karima Silvent, Global Head of Human Resources at Axa, said: “We have consciously chosen not to have women only networks, but networks of men and women. If you make gender diversity only a topic for women then you have lost the battle. In France we have a network of 1,000 people called Mix’iN. It is 35 per cent men. When you want to bring parity in an organisation, you create frustrations and question marks… We need to address employees as a whole” (https://on.ft.com/2LtBZPo). Independent finance recruitment company Ad Idem Consulting’s Ad Equality initiative looks to bring the conversation here too: ‘Ad Equality hasn’t been created to give women preferential treatment, rather a fair platform to be considered for senior roles and to encourage those returning to work that their skill sets are both relevant and welcomed despite a period away. Additionally, we help businesses train and mentor line managers in how to attract such talent, many of whom are reluctant to get back to work fearing a lack of support in the areas of flexible hours, remote working, career mentoring and a supportive working environment.’
And this is often at the heart of the matter: women’s choices around work and family are still seen as problematic and a world away from men’s choices. We still believe that women are often the poorer choice in business and we still have an intrinsic belief that men put work first and family second. And this is unfair to both genders. As Anna Purchas, head of people at KPMG UK, said: “Things like pay and progression, maternity policies and workplace culture must look at the needs of both genders and how any barriers to these or accessing them can be removed… My aim is to create a culture where asking to be at home when chicken pox strikes your child shouldn’t be seen as the mum’s option. A dad should feel just as comfortable asking too” (https://on.ft.com/2LtBZPo). Outdated beliefs about men and women’s attitudes and commitment to work do a disservice to us all. We need to recognise that all of us are challenged by work/life/family balance, while often feeling under enormous pressure to show our employers that we’re available, committed, ambitious, congenial, and that we work hard.
The great news is that there are some brilliant initiatives aiming to not only increase the number of women in finance (an important first step), but that are actioning ways to eliminate the barriers that stop women from being considered in the first place. An example of this is Girls Who Invest, a not-for-profit set up by a female hedge fund industry veteran who was shocked to find that finance and business degrees are a male-dominated domain. It will run intensive training programs for female college students in core finance, markets, and asset management, and intends that by 2030, 30% of the world’s capital will be being managed by women (https://bit.ly/2HfFE3c). There’s also the 2019 European Women in Finance conference, the focus being to ‘address the barriers to women’s careers, enable personal development, and examine how executives can change their culture to attract and retain talent. We will also explore the impact of technology and why a diverse and inclusive workforce is the key to future success for both traditional banks and FinTechs’ (https://www.european-women-in-finance.com/). ING, VISA, and Deloitte are just a few of the big finance companies involved with the conference. And as well as starting up a networking group for female graduates, Ad Idem’s Ad Equality also runs quarterly networking breakfasts for city-based female and male executives, ‘an inclusive, supportive environment where ideas are shared, best practice discussed, and mentoring partnerships forged’.
Women also need to keep the conversation moving forwards. Ann Radford, Ad Idem’s Founder and CEO, is, after all, a woman. And a very successful one. As Diony Lebot, Deputy Chief Executive of Societe Generale says: “I really think that women have to take action and be much more forceful about it. A few years ago, I thought that all I had to do was to do my job, performing in my job and people shouldn’t care whether I am a woman or a man. With more visibility and seniority, women are in a situation where they can influence and make a change, and they have to do it. They have to contribute to this change” (https://on.ft.com/2LtBZPo). Women also need to keep fighting for the jobs they want. Helen Finn, Candidate Manager at Ad Idem, also suggested that female graduates don’t get too caught up in the gender pay gap: “It’s going to be hard, finance is a tough sector to crack. However, having confidence and believing in yourself is a great start to your career.”
To sum up, we must keep the conversation moving onwards and we have to make sure it is not just a conversation, but followed by many more initiatives to break down barriers to women being equal contenders for jobs in finance.
And we need to make sure the conversation goes beyond just words. Helen Finn found: “I come across a lot of huge companies having a section on their website discussing this topic. Many of their solutions seemed to be very vague, ‘having more female board members’. It was very rare that proof of hiring more females was shown.” We need real initiatives and less lip service. And hopefully no woman will ever again have to shave her head to prove her worth in a male-dominated arena.