October 12, 2016
Improvements in flexible working are among the key steps being taken to help achieve gender balance within the financial services sector, according to the UK Treasury. Financial services is the country’s highest paid sector but has the widest gender pay gap, at 39.5 percent, compared with 19.2 percent across the economy. The ‘Women in Finance Charter’, was set up by the Treasury earlier this year to publish progress on gender balance annually and reports that of the 72 firms who signed the charter, 60 have now committed to having at least 30 percent of women in senior roles by 2021. Alongside gender diversity targets, these firms have set out strategies for how they’ll hit these targets, including improving flexible working, making recruitment gender neutral and distributing high profile work more fairly.
The Gadhia review found that in UK Financial Services female representation is currently around 23 percent on Boards, but only 14 percent on Executive Committees.Thirteen organisations, including Virgin Money, the Financial Conduct Authority and Legal and General, are now aiming for complete gender parity in senior roles – a 50/50 split.
The introduction of compulsory flexible working hours would open the floodgates to more women working in the UK financial services industry, argues Sturgeon Ventures, a regulatory ‘incubator’ or ‘umbrella’, also known as ‘FCA Umbrellas’ or ‘Regulatory Hosts’, that provides support to start-up financial services businesses until they can be directly regulated in their own right.
Seonaid Mackenzie, Managing partner at Sturgeon, commented: “There are many women all across the UK with a tremendous amount of experience and who could re-enter the financial services industry but can’t because of the insurmountable difficulties of juggling family care with inflexible nine to five working hours.”
As part of the charter, firms also agreed to make an individual executive responsible for its commitments and as a result, today 20 firms have named their CEO as the senior executive accountable for progress against their targets.
The firms who have published their strategies today employ over half a million people and span across the breadth of the financial services sector, from FinTech firms to asset managers. Over half are also headquartered outside of London, with a particularly strong presence in Scotland.
“The UK is a world-leader in financial services, but the sector could do even better if it made the most of many talented women who work in finance: said Prime Minister Theresa May.
“Too few women get to the top and many don’t progress as quickly as they should or they leave the sector completely.
“So it is good news that so many firms have signed the Women in Finance Charter and are now dedicating themselves to tackling gender inequality. They recognise the business case for doing so and with ambitious targets to deepen the female talent pool, these firms are leading the way.”
The Women in Finance Charter, set up by the Treasury, commits signatories to four key industry actions:
- linking the remuneration packages of their executive teams to gender diversity targets
- setting internal targets for gender diversity in their senior management
- publishing progress reports annually against these targets
- appointing a senior executive responsible for gender diversity and inclusion
New Financial, a think tank working with the Treasury to monitor the progress of charter signatories, will be publishing a thematic analysis of the submissions from the first cohort at the end of October 2016.