By Monika Balavakaite, Writing Analyst at Unicast Entertainment
The financial services industry has often been referred to as the “old boys’ club”, which is to be expected given that the sector has the largest gender pay gap and a severe lack of women in senior management. In 2020, the biggest gender pay gap for full time earners in the UK was in the finance and insurance sector, standing at more than 25% with only 15% of finance directors in the FTSE 100 were women. These figures were even poorer when looking at gender bonus pay gaps and the presence of women of colour in leadership positions. Major UK banks reported bonus pay gaps as large as 69%, whilst women of colour in financial services were found to be 34% less likely to make their first promotion relative to men, reiterating the vital need for greater gender diversity within the industry.
Promoting gender inclusion is undeniably beneficial to firms as studies continuously confirm the gains of a more diverse workforce. Firstly, banks with a higher share of women on their boards have been found to have greater stability, better resistance to stress, larger capital buffers, and fewer nonperforming loans. Earlier studies have also shown that business teams with an equal mix of men and women tend to perform better in terms of sales and profit, which has been echoed by a 2018 study by McKinsey; research showed that companies in the upper quartile for gender diversity on executive teams were 21% more likely to perform better on profitability, and 27% more likely to display greater value creation.
Such benefits arise because sourcing a more representative labour force allows firms to utilize a wider range of perspectives, ideas, and market insights. This can subsequently improve understanding of customers needs and enhance relationships with a diverse clientele. In addition to this, policies that nurture traditionally male dominated industries effectively limit the expertise such industries have access to. Hence, diversifying corporate boardrooms allows organisations to take advantage of a wider talent pool, which can improve efficiency and boost innovation. Fostering gender inclusion can also improve employee retention and job satisfaction. By creating a culture of equality in the workplace, organisations can improve morale and create a more cohesive work environment, which naturally benefits all personnel. 
Camilla Sutton, former President and CEO of Women in Capital Markets, discussed how gender diversity can be promoted in an interview with Unicast Entertainment, highlighting that “we spend a lot of time focused on the individuals, and we really have to focus on the systems; it’s the systems that have so many structural barriers embedded within them”. The so-called glass ceiling preventing the career progression of women to senior positions cannot be broken unless detrimental practises, implicit biases and harmful social norms are dismantled – and this can’t be addressed if the focus is only on women. Although it’s vastly beneficial to encourage women to enter the financial sector, this talent won’t be retained or progress into decision-making positions when such obstacles continue to prevail. The attention should also be on solving issues such as unconscious bias throughout the recruitment and promotion process, to create and maintain an environment where women can succeed.
Companies must also ensure that gender stereotypes aren’t amplified in industries consisting of predominantly male employees. Issues like sexism, and pregnancy and maternity discrimination still persist despite vast progress made over recent decades, and sectors like finance can’t fully prosper unless these problems are addressed. Additionally, executives must make commitments to building true equality, and remain transparent with their progress. This years’ Women in Finance Annual Review found that over 70% of organisations met or are on track to meet their goals for the number of women in senior management. Encouraging more firms to commit to such initiatives and report on progress allows stakeholders to keep companies accountable, and gives potential employees and clients a better idea of the culture such firms want to foster.
The presence of women in corporate boardrooms has always been scarce, and although it’s clear that the finance sector still has substantial catching up to do, initiatives aiming to improve gender diversity in male dominated fields are becoming more prominent. This not only supports women in finance, but greatly benefits the industry as a whole too.
To hear more of Camilla Sutton’s thoughts on breaking into the industry and more, watch her full interview with Unicast here: https://youtu.be/U7j92BvNyhA
Unicast Entertainment
Unicast Entertainment is a global digital platform celebrating and gaining insight into the success of remarkable individuals across the professional spectrum.