Along with the tech industry the finance sector has a reputation as being male dominated and slow to develop female talent. Despite the evidence supporting the value of gender diversity and a consensus for change among industry leaders, statistics continue to show that best intentions have not led to enough significant change.
The GOOD FINANCE Framework—the result of a study carried out by Dr Grace Lordan, Founding Director of The Inclusion Initiative at the LSE—launched by Women in Banking and Finance (WIBF) to accelerate change in the financial sector, identified 10 potential barriers to female advancement and recommended actions organizations should take to enable gender equality. These recommendations have a wider relevance:
Groupthink. Dominant individuals overpowered meetings, dissent was silenced, and the contribution of women was often ignored. ACTION: Eliminate or reduce groupthink by auditing meetings for groupthink, identifying its root causes, and designing meeting protocols to eliminate these causes.
Opportunities. Women succeeded when given access to interesting work and opportunities for promotion. Many women however found barriers to such opportunities. ACTION: Ask managers to audit their allocation of opportunities such as stretch assignment, pay increases and promotions. Many will discover subconscious biases in these decisions, and realize that not all deserving performers are being rewarded.
On-Ramps Off-Ramps. Marginalization and career derailment because of work-life conflict. Maternity leave or childcare pressures undermined career opportunities for women. ACTION: Design a process for women to be able to take maternity leave or accept heavier childcare responsibilities and to be reintegrated with a ‘soft landing’ when they fully return to work.
Difference. Empowerment through differences. Some of the women interviewed were able to carve out innovative niches at work that gave them opportunities to succeed. ACTION: Be open to innovation. Explore the creation of career paths that follow more innovative routes than traditional career paths.
Flexibility. Many of the women in the study agreed that flexibility in work arrangements and greater autonomy enhanced their chances for success —as well as their efficiency and effectiveness. ACTION: Encourage flexibility and autonomy in work practices by experimenting and assessing different work arrangements.
Incentives. The typical situation where the highest income generators for the firm earn the highest levels of compensation is misguided. Study participants argued that leadership and the collaborative work should be more highly prized. ACTION: Redesign incentives to reward inclusive managers. The performance of the team should be factored into individual management compensation.
Networking. Participants reported the difficulty of developing external networks. Women had less access to gatekeepers who held power and were willing to help them open doors. ACTION: Create a networking platform that brings together gatekeepers tasked with helping talented, ambitious women access opportunities.
Advocates. In the quantitative survey, men reported having at least three senior colleagues to go to for advice. The majority of the women interviewed in the qualitative study noted that such champions for their cause were lacking. ACTION: Create an advocacy program for high-achieving women, with advocates compensated for their success.
Norms. The study identified the prevalence of different norms for women. High performance by women was discounted, while mistakes were more harshly treated. In contrast, men who had ‘mediocre’ results were tolerated. ACTION: Eliminate gender differences in the company’s norms. Is the company ignoring high performance from women? Are men allowed to make mistakes for which women are punished?
Competence-Empathy. The need for empathetic managers. Leaders who were truly empathetic as well as being competent made a major difference in keeping office politics at bay and offering opportunities for women. ACTION. Provide coaching and leadership training to highly competent individuals, emphasizing the effectiveness of leaders who are empathetic in addition to competent.
To ensure a complete picture of the challenges faced by women in banking and finance, the 2021 qualitative study was based on interviews with 44 women, 23 working in front-office income-generating functions in which the share of men is higher and 21 working in communications and compliance in which women dominate. The 2021 study, followed up a wide-ranging 2020 quantitative survey of 1700 men and women working in the sector.