A Summary of HM Treasury’s Women in Finance Charter 2021
This is the latest report from the Women in Finance Charter, compiling insights from 209 financial service organisations across the UK, USA, Europe and Asia. It provides a comprehensive analysis of their progress in meeting targets to increase gender equity within senior management. This review is key because it is published annually, which encourages transparent communication and instils accountability in some of the world’s largest and most influential financial firms.
In 2015 the UK government launched the Women in Finance Charter, to tackle gender inequity in financial organisations with more than 100 employees. This includes global banks, fintechs and regulators, amongst others. The Charter ensures all signatories pledge to 1) set targets for gender diversity in senior management 2) assign an accountable executive (AE) to oversee gender diversity and inclusion, 3) publish progress annually and 4) move towards linking the senior executive team’s pay to delivery against these targets.
2020 was a key year for the Charter, as the largest group of signatories yet (81) faced deadlines to achieve their targets. The review assesses the progress they made, provides context on how Covid-19 has impacted organisational gender diversity and highlights actions that organisations are taking to achieve their targets. The report focuses on statistical data, case studies and testimonials from organisations. It is crucial to note that every organisation sets their targets, deadlines, and definitions of senior management.
- Of the 209 organisations: 35% reached their targets (either on time or ahead of time) for female representation in senior management, 36% are on track to, and 29% are not on track/missed their deadlines.
- Of the 29%, the commonly cited reasons include setting purposefully ambitious targets and Covid-19 causing recruitment and promotion freezes.
- 81 organisations had deadlines of achieving their targets by 2020: 54% did not meet their targets (44). Of the 44 organisations, the level of female representation increased or stayed in the same in 27, but it decreased in 17.
- There are a wide range of targets; of the 72 organisations who reached their targets, the targets range from 5% to 50% of female representation in senior leadership.
- Across the 209 organisations, the average target is 36% of women in senior leadership positions. Only 1 in 6 organisations mention gender parity as their ultimate goal.
- 53% of the organisations are capturing intersectional data at the senior management level, including ethnicity, sexuality and disability. A greater understanding of employee’s identities is needed in order to enact real change within organisations.
- Key actions for driving change involved changes to recruitment practices (mentioned by 70% of organisations) and creating internal talent pipelines, which included: creating sponsorship opportunities, increasing the accountability of managers, as well as commissioning learning and development, female leadership and return to work programmes.
- Covid-19 has disproportionately impacted women and has increased flexible working practices. Organisations with progressive diversity and inclusion policies had a smoother transition into remote working. When firms fall behind, it isn’t easy to catch up.
To find out more about how organisations can tackle gender equity and women’s development, check out these research summaries:
Click here to learn more about Women’s Development Programmes: 6 Lessons from Designing Women’s Development Programmes
Click here to learn more about Inclusive Leadership: Intro to Developing Inclusive Leaders