Equity, diversity and inclusion have been high on the agenda for the financial services industry for many years. While there has been significant progress and considerable work done already, there is still a long way to go. The financial services sector is still relatively white and male-dominated.
According to a 2022 report by McKinsey & Company, only 12% of senior roles in the financial services sector are held by women, and only 6% are held by Black or minority ethnic (BME) people.
A large gender pay gap also remains a widespread problem. Government data shows men’s median hourly pay in the UK’s financial sector is 24% higher than women’s, against the average of 11.6% across all sectors in 2022. This is a significant concern that firms must address and act upon.
Inequality and a lack of inclusion are not limited to the financial services sector. However, firms in this industry must play their part in improving diversity and inclusion in their workforce and recognising its importance in driving a high-performing culture.
As L&D teams, your role is integral in driving progress and fostering positive change. This can be done through setting objectives, measuring progress, and crucially, workplace training.
The Financial Conduct Authority recently conducted a survey which explored diversity and inclusion in 12 financial services firms. It found a positive commitment to diversity and inclusion in most firms, but in practical terms, there didn’t seem to be the expected level of progression.
The main issues within the financial services sector are:
- Firms are mainly concerned with gender representation, with some paying closer attention to ethnicity
- Data quality impacts a firm’s ability to act effectively on diversity and inclusion – those with accurate and up-to-date data on their workforce helped them to understand their gaps and identify where to take action
- Efforts to improve diversity and inclusion in most firms are focused on representation at senior leadership level
- The quality of EDI training varies widely from firm to firm. Some firms offer comprehensive training that covers a range of topics, while others offer only superficial training that does not address the real challenges of diversity and inclusion.
- The biggest drop in representation is in junior and middle management roles
Welcoming diversity in financial services is not only something businesses should want to do, it has tangible business benefits. A study by S&P Global found that companies recorded a 6% profit increase and 8% better stock turn within two years of appointing a female CFO.
McKinsey & Company report a significant lack of representation of different ethnic groups in the talent pipeline, especially at senior levels. However, research regularly confirms racial equity correlates with better business outcomes, so your business will benefit from a commitment to a more diverse workforce.
As an L&D team, your influence on workplace culture, strategic objectives, and employee behaviour makes you instrumental in promoting inclusive practices.
There are many ways L&D can drive EDI within workplaces, including:
- Focusing on all demographic characteristics. Ensure EDI training doesn’t just focus on gender and ethnicity. Consider disability, sexual orientation, and socioeconomic background as well.
- Improving data quality. Making sure your organisation has accurate and up-to-date data on your workforce will help you to understand your gaps and identify where to take action. This can be done through effective data training for leaders and managers within your organisation.
- Focus on all levels of the organisation. Don’t just focus on senior leadership – make sure you are also addressing diversity and inclusion at all levels of the organisation and ensure everyone within the organisation is trained on EDI.
- Create an engaging, relevant and impactful EDI training strategy. Working with Corndel means you can build a bespoke programme which addresses your organisation’s specific needs.
Education and training are paramount to ensuring an equal playing field for workers from all backgrounds. Learning and development programmes have the potential to drive social mobility forward, giving opportunities to people through their workplace, which were not possible through traditional means such as college and university. Government statistics show 49% of the poorest workers have been unable to train since leaving school, compared to 20% of the richest.
This is further compounded by the financial industry being particularly difficult to get into at a high-level without degree-level qualifications. The CFA Institute highlights how investment banks typically look for graduates with several years of experience for many of their roles, which again, removes the opportunity for people who were unable or chose not to attend university.
Apprenticeships are one of the most effective learning and development tools for supporting people from diverse backgrounds to succeed in their careers. As Richard Waite, Head of Resourcing at Grant Thornton UK LLP, said “We know that apprenticeships are a useful tool to promote social mobility as they increase opportunities for people, providing in-depth, practical learning and development and ensure a future pipeline of diverse talent”.
We at Corndel support corporate organisations by delivering high-quality training programmes that develop a new generation of highly-skilled professional leaders and managers with a heavy focus on inclusive leadership, closing data and digital skills gaps. We offer solutions for all levels, from early talent to senior leaders.
The Imperial College and Corndel Executive Development Programme is ideal for corporate organisations looking to train and develop their leaders. We also provide management, business and leadership degree apprenticeships for your early talent and rising stars delivered by Corndel College London. Degree apprenticeships are increasingly becoming a popular, viable and more palatable option for people who need to work but also want to train.
Apprenticeships allow employees to learn on the job, earn as they go and still receive a high-level qualification on completion. Championing differences and supporting employees from every background to play a valuable role in the future of financial services is crucial for an industry that wants to represent its customers and wider society.
It’s essential that L&D teams can create an engaging, relevant and impactful EDI training strategy. Working with Corndel means you can build a bespoke programme which addresses your organisation’s specific needs.
By focusing on all demographic characteristics, improving data quality, and developing an engaging and impactful EDI training strategy, the financial services sector can create a more diverse and inclusive workplace that benefits everyone.