Gender Gap in Banking
“To build future economies that are both dynamic and inclusive, we must ensure that ensure that everyone has equal opportunity. When women and girls are not integrated(,)…the global community loses out on skills, ideas and perspectives that are critical for addressing global challenges and harnessing new opportunities.”
- World Economic Forum (2017), “The Global Gender Gap Report 2018”, December 2017. ©2017 World Economic Forum.
“The financial sector currently holds the unenviable title of the least equitable sector in Australia for its mean pay gap of 26.9%.”
- Kate McCallum – National Chair, Association of Financial Advisers (AFA) Inspire, March 2019.
According to the World Economic Forum’s (WEF’s) 2018 Global Gender Gap Report, Australia is ranked a lowly 73rd out of 149 countries on the metric of “wage equality for similar work”. This ranking is well below those of peer countries such as New Zealand (26th), United Kingdom (64th), United States (8th), Singapore (2nd) and Indonesia (32nd).
The gender pay gap is particularly pronounced in the Australian “financial and insurance services” sector – one of the most highly female-dominated sectors in Australia. According to data published by the Australian Bureau of Statistics and Financy, the sector’s mean pay gap as of November 2018 had risen to a nation-wide high of 26.9%.
According to research conducted by Gen Advisory, the gender pay gap in the Australian financial sector is attributable to a combination of the following factors:
- • Inherited systems and structures in Australian financial institutions – such as promotion and remuneration criteria – which disadvantage women.
- • Lack of support for women who want to work, particularly for those with children.
- • Lack of female-friendly workplace arrangements.
- • Lack of women occupying ASX 200 board and leadership positions.
- • Discrimination – both overt and unconscious.
- • Gender stereotypes about work.
Sources: Various – listed here.
Gen Advisory’s research to date on financial equality and inclusion for women is displayed below.
What financial institutions can do to reduce the gender pay gap
- • Review the institution’s payroll data and conduct a pay gap analysis
- • Report results to the institution’s the board and executives
- • Take concrete action to close the gap
- • Set targets for the number of women in the institution’s leadership positions
- • Lobby for legislative and industry changes.
- • Provide greater transparency on the institution’s remuneration and promotion processes.
- • Provide and normalise flexible working arrangements for the institution’s female employees.
- • Provide shared care parental leave policies.
- • Pay superannuation on parental leave.
- • Provide financial support to female staff who wish to undertake further “STEM” and “AI”-related studies.
Sources: Financy (2019); Gen Advisory analysis (2019).
“The WEF report presents a conundrum. Australians like to think we’re a lot more advanced on gender equality than we are. By the evidence is in.”
- – “Haussegger, V. (2018), “Retreat Australia Fair”, Sydney Morning Herald, 19 December 2018. In
“This is not a woman’s problem. This is a system problem. …The challenge is, we’ve been trying to eliminate the pay gap for years and it is not budging. It is time for bold moves”.
- – Kate McCallum – National Chair, Association of Financial Advisers (AFA) Inspire, March 2019.
How Gen Advisory can help financial institutions address the gender pay gap
Drawing from our toolkit of services, ways in which Gen Advisory can help Australian ADIs address the gender pay gap in the financial sector include the following:
- • Ascertaining the institution’s awareness of, and preparedness to address, the gender pay gap in the financial sector.
- • Ascertaining whether or not a gender pay gap exists within the institution itself.
- • Delivering bespoke training on financial and gender equality.
- • Delivering bespoke research on a specific financial/gender equality-related area of interest.
- • Designing an institution-specific technical assistance programme on financial and gender equality.
- • Managing and executing, on the ADI’s behalf, a project to address the gender pay gap in their organisations.