Is 50% of financial services enough for gender diversity?

Earlier this week (22 March 2017), HM Treasury announced that 122 firms across the financial services sector have now signed the Women in Finance Charter.

Those 122 firms employ over half a million people in the UK so that means that almost 50% of the staff employed in the financial services sector are now covered by the plan to tackle gender inequality in financial services.

Hooray, great news. Or is it? A WHOLE year has gone by and not even half of those employed in financial services are covered. It’s that glass half full or half empty conundrum. Should we celebrate that almost half have committed to the charter or commiserate that more than half haven’t. Indeed at the Bank of England panel discussion on International Women’s Day, it was highlighted that there are some significant players who have not yet signed.

The Women in Finance Charter asks financial firms to commit to four industry actions to build the female talent pipeline for leadership positions. These are:

have one member of our senior executive team who is responsible and accountable for gender diversity and inclusion;
set internal targets for gender diversity in our senior management;
publish progress annually against these targets in reports on our website;
have an intention to ensure the pay of the senior executive team is linked to delivery against these internal targets on gender diversity.

Since the Charter launched, 77 financial services firms have committed to have at least 30% women in senior roles by 2021 and 23 firms have committed to a 50/50 gender split in senior roles by 2021. New signatories will announce their targets in June.

The Commercial Secretary, Baroness Neville-Rolfe, said:

“I know how difficult it can be for a woman to get the recognition she deserves and achieve her potential. And in financial services particularly, women progress too slowly or they leave the sector completely.

We have made a strong start – the first anniversary of the Women in Finance Charter sees 122 firms seizing the competitive advantage by tackling sex inequality head on.

But this is just the beginning. The financial industry is famed for its ability to identify opportunities to improve productivity. The Women in Finance Charter is one of those opportunities. It offers the chance to increase diversity of thought and for the financial services sector to better reflect the society it serves. This is why I encourage firms across the UK to step up and sign the Charter.”

Jayne-Anne Gadhia, CEO of Virgin Money and the government’s Women in Finance Champion, said:

“I am delighted with the strong and ongoing momentum of the Women in Finance Charter. A truly diverse financial services sector will drive productivity and underpin the UK’s position as a strong and competitive economy. There is still further to go and I urge more businesses to commit to the charter so that they can play their part in building an economy that works for everyone.”

The Gadhia review looked at the issue of unequal gender representation in financial services and found that in UK financial services female representation was around 23% on boards, but only 14% on executive committees. It is estimated that equalising the role of men and women in the labour market could increase GDP by 10% by 2030.

These awards will celebrate the individuals and organisations who are leading change by driving the gender diversity agenda in financial services.

If you work in financial services, check if your organisation has signed the charter here.

Organisations that want to sign the charter and formally commit to implement the recommendations, can visit www.womeninfinance.org.uk/ and complete the online form.