Supporting women in the finance industry

It’s a sad but true fact. We’ve looked at the numbers from FullCircl, and it proves it. Women aren’t represented at board level across the financial industry. 66% of banking boards are entirely male, and only 25% of life insurance companies have at least one woman on the board. Our industry’s still got a long, long way to go.

Finance is lagging behind other UK businesses. 40% of FTSE 100 firms have at least one woman on their boards, putting the UK second in the international rankings, but only 34% of financial firms have female representation at board level. Is that really good enough?

Our very own Amy Musk doesn’t think so. She thinks there’s room at the top table for even more women. And that we all need to do more to help women in the finance industry overcome the challenges they typically face. We agree.

Amy’s ideas haven’t sprung out of thin air. During her time at CEB (now part of Gartner), while heading DueDil’s customer success operations and now as FullCircl’s VP of growth, she’s spoken to women from across our industry and learned about some of the obstacles hindering women’s progress. And she’s seen the solutions.

Resilience. Confidence. Allyship. They’re what Amy believes will ensure that more and more women in the finance industry will take their rightful seats on boards across the UK.

Diverse boards are about more than quotas and box ticking

Helping more women in the finance industry climb to senior leadership roles isn’t about ticking boxes, or meeting quotas. It’s about ensuring talent finds its rightful place. And the numbers prove that.

FTSE 350 companies with at least one female board member reported an increased EBITDA of between 3% and 5% over a four-year period. Giving talent a chance to lead regardless of gender has real financial implications for businesses - alongside other factors like increased transparency, better accountability and more innovation.

The case for more women on finance industry boards is clear. Let talented women take their place, and success follows. But as clear as the evidence is, the finance industry is still lagging behind other sectors.

The finance sector underperforms on diversity

“As you climb the seniority ladder, diversity decreases and that’s common across all industries, including for women in the finance industry.”

That’s what Amy’s observed over her career, and the data backs her up every step of the way. Dig into the numbers, and you find a consistently large gap between male and female director numbers across geographical regions and industry sectors in the UK.

As we’ve seen, some sectors see bigger gaps - finance among them - but some regional gaps are worse than others too. The highest concentration of female directors is in London, closely followed by south-east England, but as you head towards Northern Ireland or North-East England, the number of women at the board level drops significantly.

Amy has also identified a lack of funding for female-founded companies both in the UK and abroad. Less than 2% of US venture capital funding went to all-female founding teams in 2021, according to Pitchbook.

The difficulty women have in finding funding is always a talking point at any female-focused event. As Amy explains, when you attend events like Google Cloud Women in Fintech and FinServ 2023, you soon see just how obvious the gender gap is.

In a competitive sector, confidence is key

So why is the financial sector lagging behind the FTSE 100? Why do women in the finance industry find it harder to break through to the board level than in others?

The answer, Amy says, is clear. Finance is one of the most competitive industry sectors. Which means that getting ahead is all about maintaining and displaying confidence. Something supported by a process of allyship - finding supporters within your organisation.

“I consistently see women with self-confidence issues and impostor syndrome. That impacts their ability to speak up and volunteer for tasks. Each person is unique and needs different methods to solve these issues. But building allies can help. If you feel like an impostor, speak to others about it – they probably feel the same.”

Impostor syndrome isn’t unique to women. Over 85% of UK employees say they feel inadequate. But women at the executive level believe they experience more self-doubt than their male counterparts.

Overcoming this isn’t a matter of just being more confident. It’s about finding the right support. Experiments by leadership development platform BetterUp showed having just one ally in a team can empower people and reduce the impact of impostor syndrome. If companies can promote ally behaviours, and coach all leaders to create a culture of allyship, then feelings of confidence will increase - meaning more leaders can reach their potential.

Yet according to the CIPD, only 10% of companies currently promote allyship. Fostering this kind of culture in your financial business will instantly give you an edge over 9 out of every 10 of your competitors.

Confidence is also an individual trait. While you should encourage allyship, it’s also important to foster confidence by helping female employees get involved in as many projects as possible early in their career. Finding hidden talents will develop confidence and resilience - both of which will pay off for your business in the long run.

Support women in the finance industry by using the multiplier effect

Cultural shifts are a good starting point, but financial businesses need to do more to close the gender gap. According to a Deloitte article, financial services firms need to take strategic actions in areas such as return-to-office work arrangements; and policies to support hiring, retention and promotion of women. Otherwise, they risk the gap between men and women in leadership roles widening.

Fortunately, there’s one thing businesses can do that’ll help more and more women in the finance industry rise to senior leadership roles.

Promote women to senior leadership roles.

It sounds obvious, but there’s a real factor at play here. For every woman in a company’s C-suite, three more women rise to senior leadership roles. It’s called the multiplier effect.

Female leadership is key here because, as Amy explains, improving diversity starts at the very top.

“The first step is to start communicating about diversity across the organisation to create a culture of openness.”

“Next, create a culture of diversity and inclusion (D&I) with ambitious goals. Then start measuring, for example, how many female candidates you have at applicant, acceptance and retention level; plus other areas such as gender pay gaps. When you have all the available data, start building initiatives to support your goals.”

By seeking out, hiring and promoting talented female candidates, you’ll improve your available talent pool, and begin to redress the gender gap at board level.

But ambitious goals are only part of the solution. You also need to make sure to take into account other pressures on your female employees. Something as seemingly minor as adopting more flexible working practices - as recommended by the CIPD’s Inclusion at Work 2022 report - means you’re more likely to retain talented women who often have to balance work and childcare.

Personnel changes need to be matched by cultural changes

If you’re serious about promoting gender diversity and benefiting from the improvements in performance that come from having more women at the board level, you need to support people at every level.

Your staff, of all genders, need to feel comfortable talking to each other about the common challenges they face. For women, these challenges include issues such as maternity leave, experiencing menopause, gender bias, and pay disparities.

“I'm approaching motherhood,” says Amy. “That's scary as I've been on an upward career trajectory, but now I'm having to take time off. Talking to other women in the finance industry who have navigated maternity leave and returning to work is powerful.”

But it’s not all about helping women talk to women, as Amy explains:

“We also have to empower men to feel comfortable with conversations about issues such as maternity and menopause. We must build understanding that career paths are not always linear, they are squiggly, and that’s okay - it does not necessarily diminish the end goal.”

Creating a supportive atmosphere means you’re more likely to retain female leaders, and to support talented women as they rise to more senior roles. The financial industry needs to progress - with the right initiatives, the right culture, and by building something crucial:

Resilience.

The role of resilience for women in the finance industry

Financial businesses can help encourage greater diversity by supporting women in building resilience - a crucial issue that FullCircl tackled at our Women in Business Event on 25 April 2023.

The event brought together over 50 female leaders to discuss their career journeys and explain how they’ve helped to shape the future of our industry. Guest speaker Amanda Dennis explained how her focus on resilience has shaped her career as a finance leader, inspiring attendees to focus on building greater resilience across their whole teams.

Whatever decisions you take to build resilience in your teams, and to ensure you benefit from female leadership, make sure that you commit to following through with them. That’s a commitment we at FullCircl are proud to make.