Many financial services firms employ more women than men in junior roles. But analysis shows that the chances of women progressing from middle to senior management roles are worse in the financial services industry than in any other sector. The issue is not a new one but it is a significant problem which needs to be addressed as many talented women are choosing to leave the sector altogether.
Recognising that problem earlier this year the government asked Jayne-Anne Gadhia, CEO of Virgin Money, to carry out a review of the representation of women in senior managerial roles in the UK’s financial services industry ('the Review') and to make recommendations. Her initial research shows that most progress has been made by those organisations which address the issue head-on and that progress can only be made if the right tone is set from the top.
The Review has been canvassing views from across the sector and is currently consulting on the following preliminary recommendations:
- firms should set internal targets for gender progression
- these targets should be published annually and progress against them reported and explained
- the strategy to meet these targets should be documented by an accountable executive and the strategy should be part of the published report
- the pay of executives/senior leaders should be linked to their success in achieving increased representation of females in senior roles.
The aim of these proposals is to force the issue of gender progression up the agenda.
The Review has also been seeking feedback on other wider issues such as:
- whether quotas or fixed targets at specific levels should be introduced
- whether investors and shareholders are likely to take a greater interest in gender diversity if data is made publicly available
- whether shared parental leave goes far enough to re-balance childcare responsibilities and how important this issue is in improving gender diversity
- whether the culture of 'presenteeism' creates barriers for women
- how important flexible working is at a senior level in encouraging gender diversity.
The consultation closed on 14 December 2015 and it is anticipated that a final report will be published in the New Year. We regard this as a significant and important topic and will provide further updates in due course.
In the meantime HSBC has recently announced that it intends to appoint women to half of its senior roles in the UK by 2020. This is an ambitious target but one which should be applauded. It places HSBC right at the forefront of promoting gender diversity in British banks and may encourage other banks to follow suit.