Diversity in its broadest form is an essential part of building a more sustainable business – and of changing culture and rebuilding trust in capital markets.
This report looks at why and how the most forward-looking asset owners (such as pension funds, insurers and sovereign wealth funds) are addressing diversity and inclusion. Their opinions count – as an essential source of capital for financial markets, the needs and actions of asset owners have a big impact on how the whole system […]
“True diversity in the workforce isn’t just about the people we employ, it’s about the way we employ them. . .” John Glen, Economic Secretary to the Treasury spoke at the Women in Finance Charter Annual Review launch event on 14th March 2019. You can read a the full speech below or download a PDF […]
<strong>Three years since the UK Government launched the HM Treasury Women in Finance Charter, it is having the desired impact – signatories are taking action to improve gender diversity and beginning to see positive results, according to New Financial’s latest research. </strong>New Financial’s second Annual Review monitors the progress of signatories against their Charter commitments and holds them to account against the four Charter principles. The Charter encourages the financial services industry to improve female representation in senior management by setting targets, publishing them, having an executive accountable for diversity and linking diversity to pay. The Charter now has more than 330 signatories covering 800,000 employees across the sector.New Financial is HM Treasury’s data partner for the Charter. This review includes data from 123 signatories that signed the Charter before September 2017 and provided an annual update to HM Treasury in September 2018. This review also aims to offer the broadest possible insight into actions signatories are taking to drive progress towards their targets.The highlights of the second <em><strong>Annual Review</strong></em> are:<span style=”color: #282828;” data-mce-style=”color: #282828;”><strong>1) Meeting targets:</strong></span> 45% of the 123 signatories analysed in this review have met or exceeded their targets for female representation in senior management. A further 42% that have targets with future deadlines said they are on track to meet them .<strong><span style=”color: #282828;” data-mce-style=”color: #282828;”>2) Moving in the right direction:</span></strong> Female representation in senior management at signatory firms is rising – 86% of signatories either increased or maintained the proportion of women in senior management during the reporting period.<strong><span style=”color: #282828;” data-mce-style=”color: #282828;”>3) The challenge ahead:</span></strong> For signatories that still have a target to reach, average female representation in senior management is 31%. If they can maintain their current rate of increase, these signatories are on track to meet their 38% average target in three years.<strong><span style=”color: #282828;” data-mce-style=”color: #282828;”>4) Stretching targets:</span></strong> The majority of signatories have set ambitious targets for increasing their proportion of senior women. A quarter (25%) have a goal of parity. Two-thirds have set targets at 33% or above and HM Treasury would like to see all targets move to this level in order to align Charter targets with the <a href=”https://ftsewomenleaders.com/” data-mce-href=”https://ftsewomenleaders.com/”>Hampton Alexander</a> review.<span style=”color: #282828;” data-mce-style=”color: #282828;”><strong>5) Defining senior management:</strong></span> There is growing consensus around signatories’ definitions of the senior management population to which the Charter applies – for half of signatories senior management accounts for up to 10% of the total workforce. However, there is a wide variety of definitions, even amongst firms of a similar size, with the spectrum ranging from 0.3% to 100% of total workforce.<span style=”color: #282828;” data-mce-style=”color: #282828;”><strong>6) Top actions driving change: </strong></span>The most common actions signatories reported are ensuring they have female candidates on longlists and/or shortlists for senior roles; providing unconscious bias training; and promoting flexible working. These actions are similar to those reported last year, but there is evidence that actions are developing, they are becoming embedded within organisations and are available to more staff.<span style=”color: #282828;” data-mce-style=”color: #282828;”><strong>7) Accountable at the top table:</strong></span> Accountability is sitting in the right kinds of roles, at the highest levels of seniority. Almost all (96%) accountable executives sit on executive committees, nearly half (44%) of AEs are CEOs, and about 70% have revenue generating responsibilities.<span style=”color: #282828;” data-mce-style=”color: #282828;”><strong>8) Linking to pay: </strong></span>Nearly a third (29%) of signatories believe the link has been effective, while half said it is too early to tell. More than a quarter (28%) have extended the link beyond executive committee members.<span style=”color: #282828;” data-mce-style=”color: #282828;”><strong>9) Publishing updates:</strong></span> Signatories are still getting to grips with their transparency obligations around the Charter. Nearly half (46%) had not published an online update on their progress against their targets by the required deadline and less than a third (29%) met all reporting criteria.<strong><span style=”color: #282828;” data-mce-style=”color: #282828;”>10) An achievable number: </span></strong>About 2,500 women will need to join senior management across the 123 signatories in order for them all to meet their targets, equivalent to an increase of 12% based on the number of senior female managers today. The largest firms have an important role to play here, as they account for 95% of the 2,500, particularly the UK and global/investment banking sectors.<strong><span style=”color: #0084ba;” data-mce-style=”color: #0084ba;”>Research methodology:</span></strong> This review presents annual update information reported* to HM Treasury by 123 signatories† in September and October 2018. The data was shared with New Financial on a confidential basis. All data has been anonymised and aggregated, and no data has been attributed without consent from the relevant signatory.For more information on the Annual Review or on New Financial’s diversity programme, please contact Yasmine Chinwala on <a href=”mailto:yasmine.chinwala@newfinancial.org” data-mce-href=”mailto:yasmine.chinwala@newfinancial.org”>yasmine.chinwala@newfinancial.org</a><strong>About New Financial:</strong> New Financial is a think tank and forum that makes the positive case for bigger and better capital markets in Europe. We think there is a huge opportunity for the industry and its customers to embrace change and reform, and to rethink how capital markets work. Diversity is one of our core areas of coverage.
We are excited to be hosting Sam Friedman, an Associate Professor in Sociology at the London School of Economics, to talk about his latest research and new book demonstrating the existence of a powerful class pay gap, as well as exploring the complex barriers to career progression for those from less privileged backgrounds. https://www.classceiling.org/
Rolling out unconscious bias training is a top three (if not the top) action point according to our research on the Women in Finance Charter and Gender Pay Gap reporting. But how effective are unconscious bias training programmes? Recent reports from Harvard Business Review and Government Equalities Office reports questioning their impact. This breakfast is […]
Pay is the ultimate incentive for financial services. How are companies bringing diversity and culture criteria into how staff get paid? We know that the linking gender diversity targets to pay is the most controversial of the four principles of the HM Treasury Women in Finance Charter, so how are the mechanisms for incorporating these […]
Diversity is increasingly mentioned as a means to reduce or mitigate risk – risks such as access to potential talent; incremental competitive advantages in winning new business; minimising legal, cultural, behavioural and reputational risk; and applying cognitive diversity to improve financial performance and minimise financial risk. But what does that mean in practice? This breakfast […]
While culture and diversity have both moved up the agenda of the financial services industry, most firms treat them as distinct issues with discrete initiatives and separate reporting lines. Our analysis finds diversity and culture are closely interconnected and that a more holistic approach to both would yield better – and faster – results. Diversity and Culture analyses the differences and similarities in how companies approach diversity and culture and why it matters.
HM Treasury in collaboration with New Financial present the launch event of the second Annual Review of the HM Treasury Women in Finance Charter, hosted by the City of London Corporation. This is an opportunity to gain insight into the progress of Charter signatories, celebrate successes, discuss best practice around the principles of the Charter, […]
While culture and diversity have moved up the agenda of the financial services industry for similar reasons, most firms treat them as distinct issues with discrete initiatives and separate reporting lines. Our analysis finds diversity and culture are closely interconnected and that a more holistic approach to both would yield better – and faster – […]
The event will take place just as we reach crunch time in the 2nd round of reporting cycle and will focus on what has been learned from the first round of reporting, actions being taken to address the pay gap, as well as reflections on internal and external reactions to the report. This is an […]
There is broad consensus that diverse voices enhance investment performance by increasing diversity of thought, which improves decision-making and investment idea generation while guarding against groupthink. But the industry has a long road ahead to cultivate the diverse workforce that can bring all these benefits. This report identifies the practical barriers to diversity in portfolio management, analyses what individual firms are doing to address these challenges – and highlights how the industry can work together to accelerate change.
We interviewed Wendy for our groundbreaking 2017 research, Diversity from an Investor’s Perspective, and are very excited to be hosting her for an event series with New Financial members. Wendy is fiercely passionate about the importance of diversity to everyday business, economic development and wider society, and has a broad view of the diversity agenda […]
At this breakfast with Julia Hoggett, director of market oversight at the Financial Conduct Authority, we will discuss why and how diversity is being incorporated into regulatory discussions. Julia joined the FCA from Bank of America Merrill Lynch where she was managing director, responsible for a range of debt capital markets products including European Commercial […]
Our latest research looks at the asset management sector, and specifically portfolio managers, to better understand the barriers to progression for women and people of diverse backgrounds and offer a menu of ideas from asset management companies to tackle those barriers, in order to encourage a shift in thinking from lowest common denominator to best-in-class […]
Our unique analysis of the gender pay gap data at nearly 400 firms from across the financial services industry highlights the wide range in the pay gap, bonus gap, and levels of female representation in different sectors of the banking and finance industry – and sets a benchmark to measure future progress.
At our latest event in New Financial’s breakfast series we will be trying to broaden our understanding of cognitive diversity, including Q&A with Simon Fillery, head of inclusion at the Bank of England, as our guest speaker. The Bank has undertaken an internal project to work out what diversity of thought means to the Bank, […]
With an ever-increasing focus on the diversity agenda, what are financial services firms doing to bring their incumbent population (which for most will be predominantly white men) along with them on the road to improving diversity? How can firms work on communicating with their staff so they don’t feel alienated and de-prioritised? This breakfast will […]
This breakfast event will focus on discussing the benefits and challenges of collecting and analysing social mobility indicators. We are very pleased to have Dr Sam Friedman, associate professor in sociology at the London School of Economics, as our guest speaker. Sam’s research contributed to the UK Government’s consultation to develop a set of measures […]
The UK government launched the HM Treasury Women in Finance Charter in March 2016 to encourage the financial industry to improve gender balance in senior management. This report is the first annual review of signatories to monitor their progress against their Charter commitments over the past year. And while they are off to an encouraging start – 85% have either met their targets or are on track to meet them – progress has so far been slow.
By April 2018, companies in the UK with 250 or more employees had to publish certain information regarding the pay gap between male and female employees. For many firms, the reporting process has been challenging, and the results have sometimes been confusing (particularly given the occasional misunderstanding in the media of what the gender pay gap […]
Our recent research report on ‘Diversity from an Investor’s Perspective’ showed how some of the most progressive pensions funds and asset owners are putting pressure on their asset managers to improve diversity. At this breakfast Jackie Turpin, head of finance at the Joseph Rowntree Charitable Trust, will discuss what the Trust has been doing in […]
Diversity is firmly on the corporate agenda. New Financial’s latest report looks for the first time at what asset owners (such as pension funds, insurers and sovereign wealth funds) are doing on the diversity front. We analysed 100 asset owners globally with combined assets of $8 trillion to find out why and how they are approaching diversity – and how this affects asset managers.
Diversity of thought and a willingness to challenge group think are essential aspects of diversity, particularly in financial services. This year, the Banking Standards Board published the findings of its annual assessment exercise conducted with 22 member firms and generating 28,000 responses. One-third of those surveyed said that people in their organisation become defensive when their views […]
HM Treasury’s Women in Finance Charter launched in March 2016 and now has more than 140 signatories. Our latest report is based on a survey of more than 80 firms that have signed up and assesses the concrete impact of the Charter is having on how they approach diversity, the benefits they are experiencing – and the challenges they face in meeting their Charter commitments.
The debate around gender diversity at the most senior levels in the corporate world has shot up the agenda in recent years – but for all the talk, how much progress has been made in the financial services sector? New Financial’s latest research on female representation on boards and executive committees across European capital markets shows a significant improvement in female representation on boards and excos – and the numbers are heading in the right direction across the industry.
At this dinner on neurodiversity, Ray Coyle, UK chief executive of Auticon will discuss the benefits and challenges of working with staff on the autism spectrum. Auticon specialises in placing IT and compliance consultants who are autistic. Ray will share his views on the benefits of neurodiversity, the common misconceptions about working with autistic colleagues, and offer […]
The Bank of England has been working hard to encourage staff to share information on diversity characteristics, including sexuality, disability, gender, ethnicity, carer status and religion. According to the Bank’s 2016 annual report, more than 80% of staff are comfortable about sharing their diversity data, LGBT disclosure has increased to 2.5% from 2%, disability disclosure […]
Upcoming breakfast event to discuss the Financial Reporting Council’s research into corporate culture. We are very pleased to have Anna Colban, one of the authors of the FRC’s report, as our guest speaker. Last year, the FRC undertook an extensive consultation to better understand how companies address culture, to encourage debate and identify good practice […]
With initiatives such as the HMT Women in Finance Charter and New Financial’s own diversity disclosure research there is ever-growing pressure on financial services companies to disclose more data on diversity. While there are many firms who see the benefits of being open and transparent, there are many common arguments made against disclosure, such as: ‘legal says […]