Finance firms falling behind on gender diversity targets

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Around three in 10 finance firms who committed to improving gender balance at senior management level either missed their 2020 deadlines or are falling behind on their future targets.

Analysis of the progress made by organisations that signed up to the Treasury’s Women in Finance Charter found that 44 of the 209 signatories analysed missed their 2020 target, but 35 of these came close.

The most common reasons they gave for missing their goal include setting deliberately ambitious targets in the first place and recruitment or promotion freezes due to the pandemic.

Just over a third (35%) of the 209 signatories met their targets for female representation in senior management, and a further 36% with targets with future deadlines said they are on track to meet them, the analysis by think-tank New Financial also found.

Almost two-thirds (62%) of signatories have increased the proportion of women in senior management.

John Glen, economic secretary to the Treasury, said: “It is paramount that our signatories continue to take effective action to improve workplace culture and diversity.

“I hope that this review will encourage firms to continue striving to meet their targets and adopt innovative measures to build talented and diverse leadership.”

David Duffy, chief executive at charter signatory Virgin Money, said: “When we signed up to the Charter, Virgin Money set an ambitious target of increasing our female representation to 40% in our senior management roles by 2020. Today, we have 43% female representation at senior management level.

“While we are proud of the progress we have made, we are continuing to challenge ourselves on how we can further embed diversity in our business. The pandemic has given business leaders the opportunity to challenge themselves on the future of work and the workplace and what this means for diversity. I urge leaders to use the learnings from the pandemic to break down barriers, make roles more flexible and accessible at all levels, and rapidly accelerate inclusivity so our sector truly reflects the society we serve.”

Other findings included:

Two-thirds of firms are seeking quantify the impacts of Covid-19 on women in their workforce. Measures include running employee surveys, offering support via network groups, adapting flexible working, focusing on wellbeing and adding indicators to diversity data dashboards.
53% capture data on additional diversity strands within the female senior management population, including ethnicity, sexual orientation and disability.
Nearly half (49%) said linking pay to diversity targets has been is effective, while 47% said it is too early to tell the impact this has had.
Nearly two-thirds (62%) have set targets of at least 33% female senior leadership representation, in line with the Hampton Alexander review target.
Thirty-five firms have met their targets ahead of deadline, including loan agency Pepper (UK), Danske Bank (UK), American Express and Pension Bee – which all set a target of 50% female representation.