Women in financial services in the City of London struggle if they do not perform consistently well, while mediocre men are surviving the industry in high numbers. This is according to a new report from LSE and Women in Banking and Finance (WIBF).
Researchers found a number of reasons for this disparity, include social norms, retention bias and a difficulty among women, especially black women, to gain recognition on their performance at work. Furthermore, the report identified a tendency for managers to fake empathy when managing women, recognising that the trait was now seen as valuable.
According to the study, women in financial services are in a sink-or-swim position, while men have many more opportunities to survive. This strongly indicates women are being held to higher standards; they are either ridiculed or celebrated, and have less leeway to make mistakes than men. In addition, seemingly below-average men often survive because they play ‘good politics’ and bring this ethos into their management, acting as gatekeepers of opportunities for emerging talent. This translates to emerging women being less likely to receive opportunities under these leaders, and often seeing their progression blocked.
To tackle this challenge, WIBF and LSE have created the GOOD FINANCE framework to help bring inclusivity to financial services firms. The framework takes into account qualitative research involving 79 women who participated in a recent study and attended roundtables, alongside the 1,703 respondents who responded to a survey conducted by The Wisdom Council.
Need for inclusive leadership style
Commenting on the findings, study lead Dr Grace Lordan, Director of The Inclusion Initiative at the London School of Economics and Political Science, said:
“Having the opportunities of talented women guarded by managers that favour people ‘like them’ and play bad politics is detrimental for financial services in terms of innovation. The final gender convergence will only come when financial services have managers across all levels of seniority who embrace an inclusive leadership style that ensures the voices of all talent are heard because they are certain it is better for their own objectives. Until this point, we are stuck in a compliance phase where we need to continue monitoring and auditing the progress of women in the sector to ensure progress actually happens”
Anna Lane, President and CEO of WIBF, added:
"Diversity and inclusion remains a significant issue in financial services and it can be difficult to identify the success of D&I programmes. Although some initiatives have clearly delivered others need rethinking; this was a key reason behind the Good Finance framework and we are delighted that WIBF can drive these discussions with the Accelerating Change Together research."