Three Steps to Bringing More Women into Finance
Imagine you have a critical resource shortage, but access to only a fraction of the available supplies to fill it.
That may become the fate of the finance industry.
The sector has been called among the most threatened by the current talent shortage. Yet a large segment of potential hires – namely, women – could be steering away. The simple story is that it’s becoming increasingly difficult for women to see a future in the industry. They start out strong, keeping pace with men at roughly half of the workforce at entry levels. But the numbers fall off as they ascend the ranks. The 47% that enter the field become 20% of executive committee roles, just slightly better (22%) on boards, and a paltry 12% of industry CEOs.
The data may represent the current state of affairs. But there’s good reason to expect future costs. Careers, after all, are built on promise. And with few role models at the top, young women are hard pressed to see what they could become. The absence of a clear path paired with the industry’s obvious demands can have negative consequences, both driving future employees to pursue other industries, and prompting current employees to jump ship. As one finance professional told Harvard Business Review, “If [a woman] looks up and does not see any women at the top, she wonders if she will make it — if all of the sacrifices she will have to make will pay off.”
It’s a big risk – especially in single-digit unemployment when every employee counts. But changing the trajectory (and so preserving pipelines) requires tackling the challenges on three distinct fronts.
Upending stereotypes: One study shows that a mere 2% of women actually plan to leave jobs to raise families. But outdated assumptions – that women will certainly leave – have a way of becoming self-fulfilling prophecies. “Many women lose confidence that they can succeed,” wrote HBR, “and lower their ambitions or quit.”
Women-centric support: Organizations may desire change. But many male-dominated industries lack managers equipped to guide women’s careers. “Some women,” wrote HBR, “told us their direct supervisors don’t know their career aspirations, or what to say or do to support them.” Fixing that will take deliberate effort by leadership in the form of training, mentorships, and clearly laid out career paths.
Improved benefits: Recruiting and retaining talented women requires illustrated career paths, plus the support that makes work and families possible. Many companies are already on board, as evidenced by the number of finance companies recognized on Working Mother’s Best Companies list for the first time in 2018. “Most financial firms are genuinely committed to improving gender balance,” writes HBR.
And there’s more. As the tech industry has learned, many men aspire to be active parents as well. So the steps that free women to work also free men to parent, giving organizations a competitive edge with both genders.
But meaningful change requires something else to shift – namely the subtle biases that undervalue women at work. All the best intentions will be lost if women continue to feel unwelcome. “The overt sexism of earlier times may have been stamped out,” writes the HBR authors, “gender-role expectations that disadvantage women have not.”
Such introspection will be critical to navigate the current talent market.
The alternative is a shortage with no one around to fill it.
January 15, 2019