Other parts of this series:
- The Quest for Gender Parity in the Workforce
- What's Getting in the Way of Gender Parity in the Workforce?
- Attracting Talent through Gender Parity
- Creating the Conditions for Gender Parity
- The Significance of Gender Parity within Financial Services
- Getting to Equal: Making Gender Parity Your Business
- Achieving gender parity in both the workplace and the marketplace is a global economic and social imperative, impacting every industry and geography.
- There is both a social and an economic cost to gender inequality.
- Women offer unique value to all industries, including financial services—both as employees and as customers.
- The financial services industry, like others, stands to gain opportunities and rewards by accelerating gender parity.
- To maximize the opportunity, gender parity must become a norm—within the work environment and society as a whole.
- Financial services organisations have the power to achieve gender parity with their own strategic actions.
What does gender parity mean?
In its simplest form, gender parity is equal and unfettered opportunity and rewards for both men and women—in all aspects of society. Within the workforce, this principle applies not only to the compensation men and women receive for doing the same job (which is increasingly becoming equalised), but also to a broader parity of income or earning power between men and women in general (which remains out of balance).
While women in most developed economies are now, in large part, paid the same amount as men for the same job, their overall earning power is still significantly depressed due to their difficulty in accessing higher paying jobs. On average and worldwide, a working woman earns only $100 for every $140 earned by a man.
However, there is a more dramatic hidden pay disparity that is attributable to women’s under-representation in the workforce—which is due in part to the fact that women still perform the majority of the unpaid work in the world (such as housekeeping and child care). Viewed through this lens, worldwide, women earn only $100 for every $258 earned by a man.
It’s more than equal earning power
Gender parity also means equal representation for women in leadership positions—as managers, senior executives, CEOs, and board members. According to a Peterson Institute for International Economics study, out of 22,000 global firms surveyed, approximately 60% had no female board members, more than 50% had no female executives, and fewer than 5% had a female CEO.
Equality between the sexes includes equality in education and training, career advancement, and all the other compensatory benefits a company might offer—including those that enable gender parity, such as generous family leave and flexible work schedules for both men and women. Yet while women outnumber men in higher education, and outperform them there—and frequently at work as well—women still find their rise up the ranks and their success in certain industries hindered.
Gender parity impacts your customers too
Finally, gender parity means recognizing and catering to both men and women in the marketplace. This is an important issue for the financial services industry, given the role women often play as the family’s chief purchase decision maker and financial manager. Gender parity also has significance for the financial services industry in terms of the communication and relationship skills women bring to an industry that often requires a human touch.
Why does gender parity matter?
Approximately half of the world’s population is women. When half of the world’s population is not able to fully participate and contribute equally to any effort, performance is degraded. Every aspect of society suffers when women’s contributions are not brought to the forefront and applied for greater benefit, including within the workplace.
Embracing the differences
Men and women are undoubtedly different—as genders and as individuals. In general, each contributes unique qualities and characteristics to the work environment. The skills, expertise, and inherent qualities and abilities women contribute—when combined with men’s—create a balanced whole. This is all the more reason for ensuring gender parity, and diversity in general, in the workplace.
The advantage of gender parity is not simply a theory. It is a fact that has a quantifiable value. For example, boosting female participation in leadership to 30% can increase profitability by as much as 15%. Clearly gender parity is not just “the right thing to do” because it’s “fair” and improves women’s lives. It’s also the right thing to do because it enables a more productive and profitable workforce and economy, and a healthier society.
How does gender parity play out in the financial services industry?
Financial services as an industry is neither doing the best nor the worst job at driving gender parity. Relative to other industries, it sits about in the middle—as I explained in my series on gender-balanced leadership in financial services. And that means there is more work to be done, and significant opportunity for growth.
As I mentioned earlier, as consumers, women are important contributors to the financial services industry because they frequently perform the role of the family’s financial manager. As such, they represent an untapped revenue source, not just for banks and insurers, but for other consumer-based industries as well.
It also means that women in the financial services workforce can help their organisations meet their female customers’ needs with more meaningful, personalised service. All the more reason to make sure women are well represented in all aspects and levels of the corporate structure. That effort can be a significant competitive differentiator.
What’s been holding the financial services industry back from full gender parity? Fundamentally, the same issue that impacts other industries—the lack of a full-scale, concerted effort to deliberately eliminate gender inequality.
What does the future hold for gender parity within financial services?
Everything that we’ve learned so far tells us that the time for full gender parity is now. Women are equally, if not more, educated than men, have amply demonstrated their stellar capabilities in the workforce, and are undoubtedly capable of effectively filling leadership roles. But if those holding the power do not take deliberate steps to change the status quo—and do so quickly—gender parity will continue to be something we aspire to rather than benefit from.
Making a commitment
The good news is that some financial services firms are making serious long-term commitments to creating a more gender-equal workforce. For example, J.P. Morgan has made a significant effort to overcome its leadership gender gap. Approximately 30% of the bank’s top executive roles are now filled by women. Australian bank Westpac has met its 50/50 gender-balanced leadership target, originally established in 2012. Making the commitment to gender parity is the first step.
Who is doing it right?
The conversation about reaching gender parity has been going on for a long time, but progress has been slow. In recent years, there’s been a more intense focus on accelerating the drive. That’s making a difference in getting us closer to gender equality—but we still have a long way to go. Old excuses about it taking time for women to get to (or earn) their position of equality no longer hold water. At this point, what is preventing companies and societies from achieving gender parity is their own inaction.
It is clear that successful gender parity initiatives must go deeper than simply meeting quotas, offering training sessions, and making a few token promotions. Embracing the concept of gender parity must permeate the culture—within individual companies and within the larger society as well. Just as financial services firms can look to their progressive industry peers for an example to follow, it can be helpful to look to other countries for a model.
Looking to the Nordic nations for a model
Gender parity in every aspect has become a norm in the Nordic countries. But that norm was not established in a vacuum. For example, in 2008 the financial crisis in Iceland opened the door for a veritable takeover by women of Iceland’s banking industry. Even though the country had long held gender equality as a cultural value, its banking system had been male-dominated up to that point.
The practices that drove Iceland’s banking industry to the brink of disaster were considered to be masculine-based: risk-taking, aggressiveness, and hyper-competitiveness. The only bank that wasn’t devastated by the financial crash was the one run predominantly by women.
When women took over Iceland’s banks, they infused the business environment with qualities we traditionally associate as being feminine—cooperation and cautiousness (or fiscal prudence). Their efforts saved the industry.
In other Nordic countries, like Sweden and Denmark, the cultural value of gender parity has been institutionalised through laws and corporate regulations that ensure gender balance in the workforce and elsewhere. Thus, achieving gender parity is a combination of embracing the value of gender equality as well as ensuring there are deliberate, practical actions and protections that guarantee it. This can occur in any geography. We simply have to do it.
How well is your firm performing at supporting gender parity? What do you think it could be doing better, or doing more of, to escalate gender parity?
Feel free to share your thoughts in the comments section below, or email me to discuss how Accenture can shed more light on making gender parity a reality within the financial services industry.
Also, please explore the following resources for more information on gender parity in the workforce.