4 charts on gender equity this International Women’s day
- Gender diversity in financial services has made major progress, however women lag far behind when it comes to representation in leadership.
- Here are four charts that explore the current state of women in leadership across financial institutions and fintechs.
This International Women’s Day Tearsheet takes a look at where the industry stands when it comes to women in leadership in financial services.
Over the past two decades, the financial services industry has made slow but steady gains in advancing the path towards gender equity and inclusion in the workplace. As more companies have realized the significance of gender diversity in increasing workplace productivity, they have made conscious efforts to attract and retain female talent over time.
In addition to efficiency benefits, customers, investors and governmental bodies alike have added pressure on firms to demonstrate greater commitments towards diversity, inclusion and equity.
Growth in leadership over time
Women make up more than 50 percent of the workforce in the financial services industry in the U.S but they embody just under 22 percent of leadership roles. Based on historical data, growth projections indicate that the rate of women in leadership could reach up to 31 percent by 2030.
Although this forecast demonstrates some improvement, the proportion of women in leadership would be still below parity.
Additional predictions indicate that it will take until 2085 for women to reach men when it comes to occupying key leadership positions.
Growth by leadership role
The percentage of women in senior leadership or in non C-titled leadership roles has not kept up with the pace of women in the C-suite. The gap has widened since 2010 and has reached 7.6 percentage points in 2019.
According to Deloitte, if growth across both categories continues at the same rate since 2010, by 2030 C-suite leaders could reach up to 34.1 percent compared to 24.8 percent of women in senior leadership positions. Analysis reveals that firms need to make appropriate investments to compensate and improve outcomes for women in senior leadership positions.
CEO recruitment opportunities
According to a report in its Within Reach series which examines patterns of gender equity in financial services, Deloitte reported that out of the 107 of the largest U.S public financial institutions it surveyed, all but 6 of the 111 residing CEOs were men.
Analysis of the career paths of the 92 CEOs who had been promoted to their positions revealed that women tend to have higher leadership positions in roles that are relatively unlikely to be promoted to the level of CEO. It also indicated that a majority of CEOs had previously occupied leadership positions in one of three fields: namely, in line of business, finance or operations.
Among these three arenas where CEOs are typically groomed in advance of their promotions, women are largely underrepresented. The report demonstrates that financial services firms looking to improve their quota of women CEOs will ultimately need to invest in recruiting female talent in leadership positions that fall under the umbrella of these three fields.
Women founded and co-founded fintech startups versus men-led startups
When it comes to the fintech industry, slow yet promising improvements have been observed in terms of increases in the number of women-led startups over the years.
Since the beginning of this decade, global startups founded and co-founded by women have risen at a slightly faster rate as compared to startups founded by only men. They reached 369 in 2019, growing eight-fold while men-founded startups grew by seven-fold.
Fintechs with women founders and co-founders account for 12.2 percent of total startups. This is an improvement from 10.9 percent a decade earlier.
Startups with women only founding teams comprised an abysmal 3.1 percent of the total pool in 2019, a slight improvement from 2.4 percent in 2010.