Although gender diversity is moving in the right direction in Europe and the US on corporate boards, the financial services sector has been a slow adopter. flow reports on a new diversity and inclusivity initiative from Money20/20 to redress the balance in a fintech-populated ecosystem
Money 20/20, the events organisation pulling together payments, fintech and financial services industries in Europe, the US and China and Asia, has launched an initiative to address what it sees as “the gender imbalance in leadership positions within the financial services and fintech industry”.
Designed to “foster female leadership through actionable skills, tools and mentorship across the fintech ecosystem”, the Money20/20 Rise Up programme sets out to share action plans for dismantling unconscious biases that creep into organisational behaviour – particularly in recruitment, remuneration and promotion, and in meetings.
Despite equal opportunities legislation around the world and the reduction in blatant acts of discrimination, subtle forms of inequality remain. And although the UK government’s “name and shame” 2017 gender pay gap reporting requirement for employers with 250 or more employees has gone some way towards closing the gender pay gap for UK full-time workers, some of the larger gaps remain in the finance and financial services professions 1. In addition, the Institute for Public Policy Research has called for the UK gender pay legislation to be extended to cover ethnicity and disability pay gaps enshrined in an annual Fair Pay Report.
There is no doubt that legislation has helped to change attitudes over time, it has its limits and studies show change that has come voluntarily from within organisations is more enduring and has a more positive impact on performance.
Rise up for diversity
The Money20/20 Rise Up programme was featured at the Las Vegas event held 21-24 October 2018 during a “fireside chat” with Sally Krawcheck, CEO and founder of specialist fund management firm Ellevest. Her mantra is “Diversity is bringing people into the business not like ourselves, and inclusivity ensures those people feel comfortable.” In other words, inclusion is not trying to make diverse talent conform to the status quo of be “like us” Instead, she says, firms should allow the different perspective and experiences these people bring to the place of work. It is this that drives the results shown by “study after study” brought by diversity.
The programme sets out to provide support and actionable skills for women working to take the next steps to increased seniority within their careers by connecting them with contacts, mentors, executive training and targeted learning. Monique Ruff-Bell, Event Director of Money 20/20 USA told flow, "We didn't want to only provide career development and leadership training for women within fintech, but create a community of women working in tandem to create change and bring forth career opportunities not only to each other but for other women within the industry."
Jolen Anderson, Chief Diversity Officer from co-sponsor Visa adds, "Challenging definitions of inclusion in the workplace and platforms like Money20/20, will help us influence behaviours and mindsets and create actionable steps to not only foster long-lasting mentorships and career growth for women, but also create allies across the industry."
As part of the Rise-Up programme, Money20/20 and Visa released the results of a survey polling 751 mid-to senior-level professionals in the US financial service sector on 22 October 2018. This invited responses on attitudes towards gender diversity and inclusivity in the US workplace.
The research is part of an annual initiative that sets out to track over time whether the industry’s talk of change is actually materialising. At the same time, the Rise-up alumni network will measure and track partnerships and collaborations that have evolved from the programme.
Results for 20118 showed that although it is widely recognised that companies with more diversity and gender equality outperform those with less, women in financial services believe that the current state of gender equality in the industry still has a long way to go. Additionally, they are less likely than men to believe change at senior levels is going to happen quickly.
Respondents believed that some of the most impactful changes to improve inequality would be to increase awareness and set goals, address the gender pay gap, set quotas to ensure an equal leadership team and board, and provide mentoring programs to guide women into senior roles. This is what Rise-Up is all about.
Rise Up Programme insights
From a pool of 500 applications, 35 women were selected to take part. The inaugural programme features a series of bespoke content sessions and one-to-one mentoring with industry leaders from corporates such as Apple, Ant Financial, PayPal, and Visa.
In addition, Money 2020 has contributed to the rising bank of diversity and inclusion research with an industry-wide survey to gain a better understanding of gender dynamics and perceptions across companies within the financial service ecosystem. The research is part of an annual initiative that sets out to track over time whether the industry’s talk of change is actually materialising. At the same time, the Rise-up alumni network will measure and track partnerships and collaborations that have evolved from the programme.
One of the successful applicants was Deutsche Bank’s Claudia Coppenolle, Deutsche Bank’s Director of Digital Cash who has been with the Frankfurt headquartered financial institution almost nine years in various market and digital product management functions.
Coppenolle spent four days interacting with peers and leaders from the broad fintech ecosystem and learning from speakers ranging from CEOs and founders, professors, and NGOs.
She told flow that she considers the programme “a true enabler” which has already plugged her into a strong network to C-Suite executives and partners connecting her with potential clients and business opportunities alike.
“Rise Up is about creating a platform and network that allows us to activate others. It’s an accelerator that will bring change to our industry and also the individual organisations we work in” she reflects. Bias, continues Coppenolle, is something everybody has, and while not always gender related, it does tend to play out in gender, age and colour. One tip she learned was to “flip the script”, i.e. “does a reaction to a response stay the same if the subject was the opposite sex or a different race or at the other end of the age range?”
Another proven area, she notes is hiring and interviewing where she feels there is a lot more to be done job description structure to weed out bias. While initiatives such as “name blind” application forms can help, this does not help at the interview stage and, she notes, “everyone has to analyse their own biases”.
Diversity and performance
Why does diversity and inclusivity matter? Because study after study has demonstrated that there is a persistent correlation between a more diverse leadership team and financial outperformance – and this isn’t just about gender. MckKinsey’s annual Delivering through diversity report (January 2018) examined data from more than 1000 companies covering 12 countries, and noted that the ways in which diversity exists beyond gender (eg LGBTQ+, age/generation, international experience) can be a “key differentiator”. It adds “Companies in the top quartile for ethnic/cultural diversity on executive teams were 33% more likely to have industry leading profitability.”
In the UK, 32 FTSE 100 companies have reached the target of 33% women on their boards by the end of 2020 – a target set by Lord Davies in the Gender Equality Review published in October 2015, entitled Women on Boards: 5-year summary (known as the Davies Review).
These companies, according to Cranfield’s Female FTSE Board Report 2018 include Diageo, with 55% women on their board, followed by Whitbread and Hargreaves Lansdown with 50% and GlaxoSmithKIine and Royal Dutch Shell with 45%.
In addition, says the Cranfield report, there are still 25 women holding executive roles in 22 companies, the same as in 2017, with seven women CEOs and ten women CFO/FDs. “Clearly more effort needs to be invested in developing the top end of the female executive pipeline”, notes the report.
One of the more high profile exponents of this in the UK is Dame Helen Morrissey through her work with the 30% Club. A mother of nine children, she runs Legal & General’s personal investing business and was CEO of Newton Asset Management for 15 years. When the female component of FTSE100 boards reached 30.4% in September 2018, she said in an interview with the Financial Times on 5 October 2018, “You have to change everything, you have to change the way you recruit, the way you promote, and work together.”
Another influential force is executive search specialist, Barbara Schonhöfer , who has done a lot of work persuading the UK insurance industry to look carefully at inclusion and diversity and was instrumental in founding TWIN (The Women in Insurance Network), ISC (Insurance Supper Club) and iWIN (Independent Women Insurance Network (iWIN) for the Worshipful Company of Insurers (WCI. She told flow, that corporates need to “embrace the differences between the hard wiring of men and women”. Those that do, she says, “will reap the rewards hiring women for their potential”. Schonhöfer believes that this will speed sustainable culture change.
Steps in the right direction
Deutsche Bank’s Human Resources Report 2017 summarises the banks’ progress in gender equality, which exceeds UK, US and German statutory requirements. At December 2017, the percentage of women on the supervisory board at 35% and 16.7% on the management board, adhering to the bank’s initial target. It confirms that the effort to improve diversity has not stopped here, “The increase of women in senior leadership positions remains an area of focus,” says the report.
Coppenolle, in the meantime, is sharing her learning from the Rise-Up programme with her colleagues. “Sponsorship (where you have someone advocating and creating opportunities for you) was the common thread of the success stories from the top women in financial services that were interviewed. Providing equal access to sponsorship can sometimes be difficult because we all have a tendency towards similarity bias and taking time to find similarities beyond the observable can take time.”
How can this be resolved? “A way that we could look at this is to make some of these sponsorships more structured, have people look into who they currently sponsor and to make sure they sponsor two additional people who don't look like them,” concludes Coppenolle.
Money20/20 was held 21 to 24 October 2018 with 11,500 attendees. Next year’s event takes place 27-30 October 2019
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