I’ll admit that it’s a bold title for an article. But it’s true and let me tell you why.
The Financial Conduct Authority’s own research from 2019 showed that within the UK financial services profession, only 17% of FCA-approved individuals were women. Research conducted by Forbes in 2018 found that only 15% of executives worldwide in the financial services workforce are women.
So that’s two major studies, by two well-respected organisations, that have both produced similarly disappointing results. Admittedly they’re a few years old now, but I haven’t seen any marked improvements in these stats – and there does seem to be a different report or study on improving gender equality each year.
So that got me thinking, I wonder how the FCA represents women? And what are they doing to promote gender equality within the financial services profession? I got onto my computer, fired up Google (other search engines are available!) and opened the FCA’s Conduct of Business Sourcebook (COBS). Surely the FCA will have ensured equality in their own rule book?
He is mentioned 43 times.
Him is mentioned 20 times.
She is mentioned 7 times.
Her is mentioned 8 times.
Just let that sink in. He is mentioned over 6 times as much as her. Him is mentioned almost 2-and-a-half times as many as her. What sort of message does that send?
There’s no quick or easy fix to improve gender equality within the financial planning profession, but I do believe that the FCA should at the very least ensure equality of terms used in its own literature.
However, there are also measures that financial planning firms could, and probably should, adopt to help promote equality with their clients and also within the firm itself.
Here are three ideas that you could introduce into your business:
Supporting staff through a mentorship scheme
Money Marketing admits there’s undoubtedly an “underrepresentation of women at the highest echelons of wealth management”. One possible way to try and combat this was suggested in a study in 2013 conducted by The Glass Hammer and Accenture which found there was a strong correlation between women with role models and women with leadership goals.
Whoever is reading this, I’m sure there are hints and tips you wish you would have given to your younger self. Hints and tips that may have not only helped you to avoid potential pitfalls, but also may have led to you to the path of success earlier than otherwise.
A mentoring scheme is not the magic key to achieving gender equality within the financial services profession, but experienced women in senior positions sharing their experiences with those less-experienced is certainly likely to have a positive impact.
Supporting staff through knowledge programmes
Back in 2020, the Chartered Insurance Institute conducted a study on flexible working good practice and found that half of people who took a career break (for maternity, paternity or any other reasons) did not prepare a financial plan or feel financially informed.
Firms could therefore ensure they’ve created an internal guide for their staff who may wish to take time off from work, including:
- available benefits and entitlements when pregnant or have a baby
- how to top up your National Insurance contribution record
- how to request a change to working hours
Ensuring people within your organisation have access to the right information and resources is key to ensuring a more equal and empowered workforce. Therefore, if you don’t already have one, creating an internal knowledge programme could be key in helping to ensure equality.
Do all you can to support female clients
It was back in 1975 that women were first given the right to open a bank account in their sole name. Despite being almost 50 years later, the majority of core legal and regulatory texts still refer to ‘he’ when discussing customers, as the example of the FCA’s COBS documentation demonstrates. Therefore, your firm should look to ensure that female client circumstances are properly taken into account.
I’ll use an example to demonstrate: for every firm I’ve worked with that used a form of cashflow modelling system, the client’s salary and income has always increased with inflation each year until retirement. However, on average, this assumption is far more accurate for men than women, as a study of 3,001 working adults in the UK found that 74% of women were the main carer for children and took periods off work compared with just 26% of men.
Cashflow modelling software can be an extremely powerful and positive tool to enable clients to visualise what their financial future could look like. But the results are only as good as the information inputted. Therefore, when discussing retirement plans with your clients, I’d encourage you to have a conversation about the possibility of a career break for either male or female clients, and the impact this could have on the overall financial plan.
I hope some of these ideas could provide some food for thought. As I say, there isn’t a magic solution to ensure gender equality within the financial services profession. But hopefully by implementing these minor steps, we can continue to move in the right direction.