Women are not only significantly less likely to be senior managers in the financial services sector but are paid much less when they are, research has suggested.
According to analysis by Fox & Partners of Financial Conduct Authority data from September 2020, women held just 7,552 of a total of 50,639 senior management jobs at financial services firms, equating to 15 per cent of such roles.
Gender diversity was found to be lowest at CEO level of financial services businesses, with women holding just 8 per cent of CEO positions (449 of 5,742) and just 8 per cent of chair roles (174 out of 2,090).
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Moreover, average pay for female directors at FTSE 350 financial services firms was found to be approximately £247,100 compared to the £722,300 paid to their male counterparts – almost £500,000 less.
Catriona Watt, partner at Fox & Partners, said women were still underrepresented in the boardroom and that the rate of progress needed to accelerate. “There is no quick fix but firms need to ensure they have as part of their planning a strategy that seeks to break down barriers that have typically prevented women from progressing to the top,” she said.
Watt warned that female leaders in financial services firms were “not going to emerge fully formed” and that companies needed to implement mentoring schemes to “ensure the future generation of female leaders receives the support they need to progress from middle management”.
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Arun Batra, partner at EY, CEO of the National Equality Standard and adviser to the Parker review (an independent review by Sir John Parker into the ethnic diversity of UK boards) – previously told People Management that businesses simply could not afford to shy away from transparency about the make-up of their boards if things were ever going to change.
“Being open and honest on this issue is a crucial step to diversifying the boardroom,” he said. “For years we’ve known that diversity of thought and perspective is imperative to growth, [which] is even more the case during the challenges of Covid-19, where there are new uncertainties and no precedent to follow. We’re in uncharted territory and the long-term recovery from the current global health crisis will require companies to leverage the strengths of all their people.
“Embracing the value and importance of boardroom diversity will be critical in the long term and those that fail to do so risk being left behind,” he said, urging employers to help inspire future generations of talent by creating a culture wherein all people feel they can succeed.
“Such a culture can help nurture a productive workforce, which ultimately is an important input to achieving business growth,” he added.
The Hampton Alexander review, which advocates for greater representation of women in senior leadership positions, recently achieved its target of 33 per cent of FTSE 350 board positions being held by women; however, it showed that many of the positions held by women were non-executive.