Financial technology is reliant on attracting and retaining talent to progress as an industry. As a result, the fact that women are under-represented in this sector potentially has a tangible economic impact. The way that financial services tackles this imbalance could have a significant bearing on the ultimate shape of the industry as the post-crisis landscape emerges.
There has historically been a paucity of women in financial services for a number of reasons. The long hours and the perception of a male-dominated culture can dissuade women from pursuing careers in this field. The lack of women in the industry, particularly in leadership positions, runs counter to a Randstad financial survey conducted at the beginning of the year which showed the number of women applying for jobs in financial services is now actually outnumbering men for the first time. This should in time create a pipeline of women for senior positions, so it is essential that women do not perceive there to be barriers – real or otherwise – to progression in the industry.
In the technology world, the problem is compounded by the fact that this has also traditionally been a male-dominated profession and a societal perception that it is a vocation better suited to men. Even Google, perceived to be a forward-looking company, recently discovered in its first diversity report that only 30% of its employees are women. What’s more, a recent study by the Centre for Economics and Business Research showed that the shortage of skilled staff in the IT sector was causing a 15% drop in output, which it found could potentially be made up by balancing the gender gap which it found existed in the industry overall.
Fintech sits at the juncture between these two businesses, and subsequently, the under-representation problem is especially pronounced in this field. It is difficult to judge the extent, given the lack of substantive research on this issue, but anecdotally, there is still an obvious shortage of women in the industry. This becomes particularly evident in the higher levels of the business, when there is a “drop-off” point after which women find participating in the business is incompatible with their family and life choices.
One of the main drivers of this is the culture of “presenteeism” that pervades City culture – working long hours purely for the sake of being visible in the office. Many have found this is incompatible with what many might consider to be a healthy work-life balance and family priorities. These factors create a point at which many talented people – predominantly women – are lost from the workforce. It can also compound a sense of exclusion and isolation as decisions and team collaboration often take place when they are not present.
Given the tools that are at our disposal in the 21st century workplace to work flexibly and more efficiently, it makes little sense for this state of affairs to continue, not least because it makes better business sense. During the earlier stages of a career (from joining a firm as a graduate to leaving to begin a family), there is a potentially huge investment that has been made of time, effort and expense in an individual’s training and development. For them to simply leave the business because their personal life cannot be accommodated does not add up from a financial perspective.
What’s more, a lack of female representation in the workforce can be seriously problematic from a customer retention standpoint. As markets become ever more globalised and the industry itself evolves, companies that fail to reflect these changes will find it increasingly challenging to understand and service their changing and diverse customer base.
So how can financial services companies, and fintech in particular, prevent talent drain? There are a number of ways that organisations can make themselves more attractive to talented female employees, and indeed any individuals seeking a healthier work-life balance.
The first step is tackling the pernicious culture of presenteeism. Our experience has shown that dramatically cutting the number of hours in a typical working week does not necessarily diminish output. To the contrary, employees can be significantly more productive in this type of framework. We run our business part-time in its entirety – so no individual needs to work more than 25 hours a week; output has not been affected in line with this reduction as we have found the flexibility on offer encourages productivity.
As a result of our model, we have recruited many highly-skilled women with extensive City experience in financial services, who simply had no outlet for their skills and experience that was compatible with the lifestyle it demanded. This has given them an opportunity to continue to work and develop their careers, after their previous employers had invested thousands in their development and training only to let them leave due to practicalities.
In addition, companies can think about leveraging the infrastructure around them to feed diversity into their own businesses. Outsourcing to innovative start-ups and alternative providers, which are often at the vanguard of new working practices on diversity and inclusion, can provide a simpler means of accessing new talent without having to change existing business models internally.
This is a useful starting point, which can lay the foundations for fintech companies and other institutions to think about more long-term ways they can incorporate increased flexibility into their working environment. Ultimately, these measures will prevent the haemorrhage of talented staff, both female and male, from the fintech world.
By Tina Freed, COO and Co-founder, E2W