Firms have a long way to go to solve the gender equality issues found in financial services workplace culture, according to the Financial Conduct Authority.
Speaking at a Treasury committee evidence session today (June 12), FCA executive director of supervision for investment, wholesale and specialists, Megan Butler, said the industry was still at the "early stages" of its "journey".
Ms Butler said although she saw a lot of engagement with gender issues from senior management staff in financial services firms, this did not tell the whole story.
She told the MPs: "Chief executives come and talk to me voluntarily about their diversity and inclusion practices, all of which is great.
"But the backdrop of that is that I also receive a steady stream of horrifying whistle blows that would indicate pockets of truly toxic cultures that operate sometimes within the same institutions that are coming to tell me about the great initiatives that are underway.
"This just shows the journey that has still to be gone through to drive some of these changes through organisations. We're at the early stages."
Ms Butler went on to say that the issue was "not just one for the big banks" as the regulator found bigger firms often had better outcomes than smaller financial services companies, which had further to come still.
Last year, the committee produced a report on Women in Finance which said bonus negotiations should be scrapped and flexible working should be encouraged to amplify the progression of women to senior positions in the financial services sector.
The report also criticised the 'alpha male' culture in financial services, including the presenteeism and bonus negotiations.
To address this, the committee said bonuses should be assessed in a formulaic way against clear objectives and senior staff should lead by example in flexible working.
Discussing the impact of the report in today’s evidence session, chairwoman of the committee Nicky Morgan asked whether these issues had been addressed in the financial services world and pushed to pinpoint what more could be done.
Ms Butler said the FCA had looked at the remuneration of employees, especially at banks.
She said: "We’ve seen everybody move to balanced score cards, which assess not just what you do but how you do it.
"But I would observe that it’s much harder when you drill into that to find examples where people have been rewarded for good behaviour rather than penalised for bad behaviour."
She said the FCA had written to the chairs of such banks to ask whether they understood the gender pay gap in an attempt to drill into this set of issues.
The regulator asked the firms whether they had objective bonus criteria that were being fairly, appropriately, and transparently applied and that when employees got their bonus, they could understand exactly what it was telling them about their behaviour.