CompaniesMay 5 2016

How to bring more women into financial services

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      How to bring more women into financial services

      Diversity and gender equality have received considerable attention recently.

      For example, in April, the Equalities and Human Rights Commission (EHRC) published: ‘How to improve board diversity: a six-step guide to good practice – a guide’.

      This is a distillation of key recommendations based upon its extensive report: ‘An inquiry into fairness, transparency and diversity in FTSE-350 board appointments’.

      In part this was following up the work of the Davies report, which led to the voluntary code of conduct for executive search firms. The code set out suggested best practice in the area of gender diversity and best practice in search.

      It is worthwhile to note the EHRC’s six headline recommendations:

      Making an appointment

      1. Define the selection criteria in terms of measurable skills, experience, knowledge and personal qualities.

      2. Reach the widest possible candidate pool by using a range of recruitment methods and positive action.

      3. Provide a clear brief, including diversity targets, to your executive search firm.

      4. Assess candidates against the role specification in a consistent way throughout the process.

      Ongoing action to improve diversity

      5. Establish clear board accountability for diversity.

      6. Widen diversity in your senior leadership talent pool to ensure future diversity in succession planning.

      Recommendations one to four focus on effective shorter-term actions, whereas five and six are of particular importance in the context of gender equality in both the short and medium term.

      This resonates with key aspects of last month’s government backed report: ‘Empowering Productivity: Harnessing the talents of women in financial services’, led by Jayne-Anne Gadhia CBE, chief executive of Virgin Money.

      The scope of review of ’Empowering Productivity’ was rather broader than board level appointments. Significantly, it makes a number of recommendations intended to improve the progress of women beyond middle management and to increase female representation at senior management level.

      It also emphasised the crucial role that clear board accountability should play in helping deliver such changes.

      The Women in Finance Charter

      The overarching recommendations of the report have been transposed into the Women in Finance Charter. This voluntary initiative aims to give financial services businesses – those which meet the FCA’s definition of a Financial Services firm - flexibility to adopt the charter in a proportionate manner.

      The report recommends a voluntary approach as being appropriate initially. However, if in 12 months’ time large sections of the financial services industry have not engaged, the expectation is the Treasury should re-examine whether a more prescriptive approach is required.

      Signatories commit to supporting the progression of women into senior roles by focussing on the executive pipeline and the mid-tier level, and to publicly report on progress to deliver these targets.

      The focus is very much on increasing the number of female managers. The report lists 10 positive actions firms can take to achieve this. These are:

      ■ Invest in supportive people managers

      ■ Create the right culture

      ■ Provide technology which supports flexible working

      ■ Ensure there are transparent pay structures

      ■ Increase the number of female role models

      ■ Implement good flexible working policies

      ■ Support working parents by encouraging the take up of shared parental leave

      ■ Offer return to work programmes

      ■ Offer mentoring schemes and active sponsorship

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