Every March our social media feeds are flooded with posts, articles, and stories around International Women’s Day. But the issues and problems raised around Gender Equality, Gender Equity, and Diversity and Inclusion in the workplace haven’t disappeared just because our calendars have ticked over to April.
The global banking and finance sector in particular has had notorious problems with a lack of female representation. Although there is evidence these issues are taken more seriously than they were a decade ago, there is still plenty of room for improvement.
We’ve dug through the numbers and found the following 15 statistics and studies around the current state of women in the finance sector, as well as the benefits to achieving greater diversity:
Women in the finance sector right now
A 2019 study by Deloitte, found only 6 of the 107 largest public financial institutions in the United States had women in the role of CEO.
Women, and especially women of colour, are underrepresented in the leadership of North American Financial Industry Firms. While women make up 30% of the entry-level positions at these firms, they make up only 17% C-suite positions, and this number drops to just 1% for women of colour.
Barriers to women getting into finance
CEOs who have been hired into their position (and not founded the company themselves), are most likely to be groomed and recruited from three particular leadership roles: leading lines of business, finance, or operations. And it is in these leadership pools women are most underrepresented. That’s not to say women aren’t in leadership roles, just not typically those historically leading to a CEO promotion.
70% of senior leaders in financial services are passionate and actively engaged in Diversity, Equality and Inclusion (DEI) initiatives and programs. However, this number drops to 45% for frontline manager engagement – those who are actively interacting with employees on a day-to-day basis. This limits the acceptance and implementation of these initiatives.
Benefits of diverse workplaces: What happens when we remove the barriers?
Studies have shown that having a mother in a STEM field like Finance, will increase a young girl’s likelihood to take the same career path 48% more than it will a boy. Showing that an increase in the gender diversity in Finance now, will lead to continued and greater diversity on the future.
Economic models have shown that locking women out of the labour force is actually detrimental to global economies. In the extreme, a complete lack of women in the labour force reduces income per capita by almost 40%.
Other studies have investigated how gender diversity increases firm value and explain how female directors benefit corporate board performance. They found women directors contribute to boards by offering specific functional expertise, often missing from corporate boards.
When it comes to profitability, companies in the top-quartile for gender diversity on their executive teams were 21% more likely to have above-average profitability than companies in the fourth quartile. Even greater results were found for those with ethnic/cultural diversity, with top-quartile companies performing 33% better in profitability.
Where to from here for women in finance?
There are some troubling concerns within the statistics and studies above, but there are also some promising trends to stay optimistic about.
Bookmark, share, and include the stats that stand-out most to in your next pitch or social media post. It’s our hope by accumulating all these findings together in one place we can all be better armed to develop more diverse and equitable processes, practices and talent pipelines.
If you need some guidance shaping diverse and inclusive recruitment screening processes, get in touch with us at Alcami Interactive to request a personalised demo.