The financial services industry is in danger of “going backwards” with female representation as the number of appointments fall, according to the Financial Conduct Authority.
Speaking at Pimfa’s Women’s Symposium, Sheree Howard, executive director of risk and compliance oversight at the regulator, explained the rate of appointment of women to wealth management and financial advice boardrooms has fallen 28 percentage points in the past year.
Additionally, in the previous year, just a third of all board appointments were female directors, a decrease of 61 per cent when compared to the year before.
Howard also identified a decline in the share of women employed in the industry overall, falling from 51 per cent to 43 per cent, despite the sector continuing to expand.
While she said that this could be partly attributed to the removal of lower skilled roles in which women were more highly represented, as well as advances in technology, “there is more that is needed to be done to attract women into the industry”.
Pimfa chief executive, Liz Field, shared a similar sentiment: “The financial services industry has seen tremendous progress in both providing women with the opportunities that they need as well as creating a workplace which allows them to truly fulfil their potential.
“While this progress is undeniable, it’s clear there is still much work to do and the figures outlined by the FCA are testament to that.
“Women are set to control 70 per cent of global wealth within the next two generations which makes the business case for the change in culture we want to see undeniable, and I echo Sheree Howard’s sentiments that this should be a wake-up call to the industry.”
Required action
To address this possible reversal of progress, Howard said changes in financial services firms’ culture still need to become “fully embedded” to attract female talents and female investors.
She explained the wealth management and financial advice industry still needed a “different and better mix of advisers and advice” to ensure that women were receiving the help they needed.
Additionally, Howard suggested financial services firms need to pivot towards “attracting women into more rewarding mid-level and senior roles”.
She said the way to do that was to ensure the right culture exists, so the right female talent is attracted to the industry at the start of their career and they are promoted on their merit and hard work.
Howard also stated one of the main deterrents to women entering financial service were the large instances of non-financial misconduct, which often took the form of sexual harassment.
She warned that this misconduct could “destroy a firm’s reputation” as well as contributing to “toxic group think”.
Howard therefore called on firms to tackle those individuals that didn’t meet their professional standards by risking their firm’s reputation, their clients’ money and their colleagues’ wellbeing.
tom.dunstan@ft.com
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