Inspring Inclusion
As we celebrate International Women’s Day 2024 with the theme ‘Inspiring Inclusion’, We delve into the progress and ongoing challenges for women in finance. This year, we reaffirm our commitment to fostering an inclusive environment, not just today but every day, recognising the crucial role women play in the realms of private equity, wealth management, HR, hospitality, real estate, business support and insurance.
The Current Landscape: McKinsey’s recent findings paint a mixed picture. While women in financial services are promoted at a rate of 86 for every 100 men in Northern America, the scenario is less encouraging for women of colour. Despite this, the financial sector has shown resilience in supporting women, especially during the pandemic. 59% of women in financial services reported increased support in the past year, compared to 47% in other sectors.
Leadership Roles: A Glass Ceiling? Deloitte Insights reported in 2023 highlights a modest rise in women’s representation in leadership roles within financial services firms, from 22% to 24%, with an expected growth to 28% by 2030. Notably, the multiplier effect suggests that one woman in a C-suite role correlates with three women in senior management roles. However, the progress towards gender parity remains slow, underlining the need for strategic actions to promote gender equity.
Senior Finance Positions: A Stark Reality A BCG global study reveals a significant underrepresentation of women in senior finance positions. Despite gender parity in finance functions, women hold only about one-third of these roles. The scarcity of women in top finance roles like CFOs, which stands at just 13%, points to systemic issues including a lack of diversity commitment, role models, and inclusiveness in work activities.
The Global Perspective: The International Monetary Fund (IMF) also emphasizes the need for closing gender gaps in finance. It underlines the benefits of diversity in leadership roles and calls for more inclusive practices in the sector. EY reports that ‘All European financial services businesses monitored have female representation at boardroom level and the current gender split of board members across all businesses stands at 58% male and 42% female”
Busting myths around women in the workplace: Growing Ambition Amidst Workplace Flexibility and Persisting Challenges
The 2023 Women in the Workplace report by McKinsey and LeanIn.Org sheds light on several crucial aspects of women’s experiences and career progression in corporate America. Notably, the report reveals a marked increase in female representation at senior management levels, the highest to date. However, this progress contrasts with the stagnant growth in mid-career roles, emphasizing the ongoing underrepresentation of women of colour and the difficulty in achieving true parity.
Key findings of the report include: Persisting Underrepresentation: Despite significant strides in senior leadership, women, particularly women of colour, remain underrepresented at all corporate levels. The report highlights that women constitute about one in four C-suite leaders, with women of colour accounting for only one in sixteen.
Ambition and Flexibility: Contrary to the myth that women are becoming less ambitious, the report finds that women’s ambition has actually grown since the pandemic, fuelled by the flexibility offered by hybrid or remote work arrangements. Young women under 30 and women of colour exhibit particularly high levels of career ambition.
The ‘Broken Rung’ Barrier:The largest obstacle to women’s advancement is identified as the ‘broken rung’ at the managerial level, rather than the ‘glass ceiling’ at higher tiers. This refers to the significant disparity in early promotions between men and women, particularly women of colour. This gap results in fewer women being available for promotion to senior roles, creating a domino effect that impacts representation at higher levels.
Impact of Microaggressions: The report also addresses the substantial impact of microaggressions in the workplace, which disproportionately affect women, especially those with traditionally marginalised identities. These everyday discriminatory actions and comments significantly affect women’s psychological safety and career progression.
Flexibility Beyond Gender: Contrary to the belief that only women desire flexible work, the report finds that both men and women rank flexibility as a top employee benefit. While flexible working arrangements are especially beneficial for women who typically shoulder more childcare and household responsibilities, they also offer advantages like better work-life balance and reduced burnout to all employees.
In conclusion, whilst there seems to be no notable progress in certain areas, Carnegie Consulting understands that true inclusion goes beyond numbers. It’s about creating an environment where diverse talents can thrive, the need for continuous and targeted efforts to address the specific challenges faced by women in the workplace, particularly in the areas of early career advancement and the eradication of microaggressions. We believe in the power of diversity to drive innovation, resilience, and performance in the finance sector. As we work with private equity, wealth management, HR, hospitality, and insurance firms, our focus is not only on recruiting top talent but also on inspiring inclusion and empowering women to reach their full potential.
Join us in this journey towards a more inclusive finance sector. Let’s work together to not only celebrate the achievements of women but also to break down barriers and create opportunities for all, also tapping into a diverse range of skills and approaches. On International Women’s Day and every day, let’s commit to ‘Inspiring Inclusion’.
