Women in Finance
Representation of women in the corporate world has seen an uptick over the last few years. While the underrepresentation of women in the workplace is still alarmingly high, the situation has been slowly improving. As per the Women in Workplace 2020 Report, women representation in entry-level roles in corporate America is at 47%. But the figure is far gloomier at senior levels. Around 28% of females hold the position of vice president or senior vice president, and only 21% of them hold positions at C-suite levels. The bitterness of these statistics can be made up for by the fact that they are improving over the years. However, senior positions occupied by women in finance continue to be low, as they have been for long. According to studies conducted by the Harvard Business School, senior positions held by women in venture capital and private equity firms were staggeringly low, at just 9% and 6% respectively. (Chandler, 2020) As per another study, female representation in executive positions in all financial services was only 15%. (Forbes, 2018)
Why has this field not been able to keep up with the other professional fields in terms of gender parity?
As per surveys conducted by American Management Consulting firm Oliver Wyman, women entering the financial services industry are as motivated as men. They have the same level of career ambitions as men, and they retain the same over the first few years of their career. However, by the age of 30 years, this ambition level drops for most women. (Oliver Wyman, 2016)
At this age, women start feeling that the costs of working in the financial services industry outweigh its benefits. The predominant reason behind this is in most societies, women are still expected to play a greater role than men in managing the household. It becomes very difficult for women to juggle between a highly demanding job and taking care of their households. To comply with the cultural norms, women tend to choose to step down from their corporate jobs.
Studies indicate another reason for the underrepresentation of women in the financial services industry. Women are not encouraged to explore finance as a subject, or career option, as much as they are encouraged to explore STEM subjects. (Kelder, 2019) To top that, there is a phenomenon, called ‘Math Gender Gap’, which suggests males are better at mathematics than their female counterparts. (Ramesh, 2019) This deters women from pursuing a career in finance, as the stereotype ingrains in them an intrinsic fear of not being able to be as good.
Underrepresentation of women in the field is like a vicious cycle. Young women have very few people to look up to in this field. Lack of an idol makes it difficult for many women to stay motivated and dream big. Women in entry-level roles have often limited access to senior leaders. Many women feel more comfortable interacting with female senior leaders. They feel they can be mentored better by someone who can best relate with them. Sometimes, male senior leaders may also resist excess interaction with female employees, due to misuse of sexual harassment laws. This restricts female employees from getting mentorship, and opportunities in the future.
What can be done to make things better?
As noted earlier, most women face conflicts between private and professional life in their early thirties. This generally pushes them to put their careers on hold. Restarting their careers after the conflict reduces is rather difficult for them. They often don’t have the support required to re-enter the corporate world and have to rely on their limited personal networks for the same. Changing the cultural norms that put women in this dilemma is a long-term goal that cannot be achieved overnight. Right now, however, women should be encouraged and supported to restart their careers whenever they find themselves in a position to do so. Financial services companies should launch inclusion programs for such women. Through these programs, companies should train and support women who seek to restart their careers in the field. The programs will also give women a chance to network with professionals, and discover career opportunities.
One step towards changing the cultural norms will be by changing parent and family support programs of organizations. Giving no/insufficient paternal leaves implies organizations expect fathers to come to the office, while mothers have to stay back at home and take care of the newborn. This sets the stage for many such similar compromises to be made by women in the household in the future. Thus, fathers should be encouraged or mandated to take paternal leaves, and at the same time, mothers should be encouraged to return to work after their maternal leave gets over.
Women who are currently in leadership positions should realize how grave the problem of the underrepresentation of women in the field is. They should actively sponsor and mentor budding women leaders. Lack of guidance and influence of senior employees can negatively affect one’s career advancement. Having the guidance of a mentor will help women tackle and solve situations (situations that may have otherwise led them to give up on their career) both in their personal and professional lives. Men in senior positions should also be encouraged to mentor female and male junior employees alike. The mentorship programs must be designed in a way that male senior employees cannot be falsely accused of sexual harassment, to make the senior employees feel safe. At the same time, it has to be ensured that proper checks are put in place so that sexual harassment does not take place in the workplace.
The underrepresentation of women in the corporate workplace, specifically in the finance field has to be talked about more. The importance of gender parity in the professional world cannot be overstated. Many developing countries where reported gender inequality is more severe do not even measure these statistics. It is very rightly said that only that can be improved which is measured. The scourge of gender discrimination and inequality has for ages deprived women of the freedom and opportunities that they rightfully deserve. A few more nudges towards the right direction might help women break the fetters of gender-biased customs and write extraordinary success stories as they chase their dreams.
References
Chandler, S. (2020, June 17). Investopedia. Retrieved from Investopedia: https://www.investopedia.com/articles/investing/092315/why-are-so-few-women-finance-its-complicated.asp
Forbes. (2018, June 5). Forbes. Retrieved from Forbes: https://www.forbes.com/sites/forbesmarketplace/2018/06/05/5-things-you-need-to-know-about-women-in-finance/?sh=2a91c7e44e77
Kelder, B. (2019). Why are There So Few Women in Finance. Retrieved from Future of Business and Tech.
Oliver Wyman. (2016). Women in Financial Services.
Ramesh, S. (2019). Her Culture. Retrieved from Her Culture: https://www.herculture.org/blog/2019/12/11/why-are-there-so-few-women-in-finance
By Ritamvara Das
Class of ’21 | Indian Institute Of Management Tiruchirappalli
