In the finance sector, most major organisations have introduced a range of initiatives to encourage more women into leadership roles. Despite this, progress remains painfully slow. Jenny Straumers from Cirrus offers advice in Finance Monthly.
In 2017, the SKEMA Business School Observatory on the Feminisation of Companies published its Gender diversity in the banking industry report, looking at female representation in 71 banks across 20 countries. The report found that although women make up 52% of global banking workers, they average only 38% of middle managers and 16% of executive leaders. The researchers suggest that women in banking face a ‘double glass ceiling’ – while reaching the middle management tier can be challenging, breaking through to more senior leadership roles can be tougher still.
Research from the FT also highlights that although the majority of junior staff working in financial services are women, only one in four reaches a senior role. The research demonstrates that the proportion of women at each level plunges dramatically as women move up through the ranks. In general, the FT concludes, progress has been painfully slow. Some representative comments from women interviewed for this research include, “if all your bosses are men there isn’t much to aspire to” and “men are better at self-promotion”.
In 2016 Jayne-Anne Gadhia, CEO of Virgin Money, led a government review into the representation of women in senior management in the finance sector. Her report, Empowering Productivity: Harnessing the Talents of Women in Financial Services, revealed that only 14% of executive jobs were held by women.
Gadhia’s report identified a ‘permafrost’ in middle management – women are either failing to progress or simply leaving. Although there is a widespread assumption that many women put their careers on hold to focus on family, the research found that women without family commitments were just as likely to stick in middle management or to walk away. Gadhia suggested that the issue is a complex one and the solution lies in cultural change.
There is some evidence that women are more reluctant than men to put themselves forward for leadership roles. And even in our age of quotas and women in leadership initiatives, there is still an ingrained unconscious bias deeply ingrained in the culture of many organisations.
What can organisations do to address this issue?
Think about the future leadership capabilities you need
Too often, senior leaders recruit in their own image and are not always open to the benefits of gender diversity and different leadership styles. However, in our fast-moving, digital era every organisation can benefit from more diverse leadership at every level. We also need to rethink the type of leadership skills that we need in unpredictable times. This represents an ideal opportunity to engage more women with exciting development opportunities.
At Cirrus, we have carried out a great deal of research into modern leadership challenges and have identified the capabilities that will be vital for leaders now and in the future. This is a key aid in identifying talent, both externally and internally, and for encouraging more women into more senior leadership roles.
- One valuable skill is the ability to make sense of complex information, connecting the dots to help set the direction of the business, and to stay on course.
- An entrepreneurial and creative streak is also key to take advantage of opportunities, whatever these may be.
- The ability to get others ‘fired up’ whilst collaborating with people across complex systems is also important: working with and through others to deliver results.
- To move beyond middle management, it is helpful to nurture talent that can take over your own role and help your organisation to get ready for the future.
- Finally, there is an ever-increasing requirement to be comfortable with uncertainty and navigate without the full picture.
Developing these capabilities will help, but it’s also vital to consider future potential for leadership. Here the notion of career aspirations and key drivers or motivators come in, which will be particularly relevant to explore with female candidates. We know it can be lonely at the top. Talk to the women in your organisation about the variety of leadership positions you can offer and explore how they fit with each individual’s career aspirations. Understanding what is important to women leaders can help you build a more diverse senior leadership population.
Identify and develop your talent
Identifying potential at an early stage is a key part of encouraging more women into senior leadership. In line with the above capabilities, it’s important to ensure women with leadership potential are cognisant of their strengths as well as aware of areas for development.
Offer support in various forms to ensure women are focused on developing their careers – most people will benefit from a combination of work experience, coaching and mentoring as well as formal learning and development.
Through ongoing performance conversations, supportive managers can help women to build increased confidence in their capabilities. Providing access to a network of senior female mentors can offer valuable advice. One-to-one coaching can help to identify individual goals and work out ways to achieve those goals. More formal programmes of learning and development, especially those with a specific focus on women in leadership, can be invaluable.
Reach out to young women and girls
Many big financial institutions now have early outreach programmes, where senior women leaders visit schools to help shift girls’ perception of the finance industry.
Ensure you have women on the shortlist
If your organisation is not shortlisting women for senior leadership roles, you really need to ask yourself why not. If you work with external recruiters, be very clear about the importance of diversity. If internal candidates are not coming through, think about more creative ways of encouraging them. Women are not always quite so vocal about their aspirations as their male counterparts
Create a culture of inclusion
Creating an inclusive and flexible working environment can help to embed diversity across your organisation. Ditch any ‘presenteeism’ mindset and encourage remote working and flexible working hours where you can. For many women these senior roles are just not ones they aspire to. Ensuring you attract women into these roles with support for the transition but also creating the roles in such a way as to appeal to different ways of doing things.
Treat women fairly
Interesting research from the Bank of England found that women experience more severe repercussions for misconduct in the financial advisory industry than their male counterparts do. The research found that women are 20 per cent more likely to lose their jobs – and 30 per cent less likely to find a new one – following an incident of misconduct compared to men. The gap is even wider in organisations with few female managers. Researchers commented that “The effects of the gender punishment gap are costly, long-lasting, and may ultimately contribute to the glass ceiling faced by women in finance.”
Appoint more women to board positions
The government has introduced diversity quotas to help address gender imbalance at board level. The cultural impact of more women on the board can be significant. These women can be powerful role models for others. There is also evidence that women are less likely to take the sort of risky decisions that led to the financial crisis.
© Finance Monthly 2019