As we celebrate International Women’s Day, The Paypers discusses with Miranda McLean about key findings from ‘The End of the Tunnel’, an insightful white paper drafted by the European Women Payments Network together with Banking Circle around topics such as diversity and closing the gender gap.
What triggered the development of the inaugural ‘End of the Tunnel’ report and what are the report’s main objectives?
The EWPN (European Women Payments Network) focuses primarily on gender parity within payments and fintech, but we are also committed to increasing diversity and inclusion in all areas. Intersectionality, race, ethnicity, sexual orientation/identity, to name a few.
For the sake of future generations, we knew we needed to give the industry an accurate picture of what is happening, to kick-start the global conversation and bring about real change. If this industry continues to be dominated by middle-class, middle-aged men, how can we expect to encourage the next generation into payments and finance?
To create that accurate picture, we commissioned research to find out about any discrimination individuals experience at work, opinions on industry efforts to enact change, and whether those working in the industry have seen positive changes taking place. The inaugural ‘End of the Tunnel’ report was designed to act as a benchmark, showing the experiences, pressures and imbalances currently felt by the financial services workforce. It provides a snapshot of the industry, a collection of insights to help the sector make improvements for the benefit of all.
Diversity has been something of a hot topic in recent years. To what extent has this led to change in the payment and financial services industry?
Key findings from our research suggest that, despite the current focus, we have yet to see meaningful change occur, and there is still much work to be done.
Industry reports show that women account for just 2% of financial services CEOs and less than 20% of executive board members. The Bank of England is failing to meet its gender diversity targets. Japan’s Mizuho has admitted that only 3% of its senior staff are women. And, just 10% of management jobs in the UK are held by members of the black, Asian, and ethnic minority (BAME) community.
Arguably the most revealing finding from the survey was that within an industry heavily dominated by men, 60% of those who responded to our invitation and took part in the survey were women. We believe this suggests that the women we invited to take part see the importance of the issues more clearly and were, therefore, more inclined to provide feedback than the men we invited.
Other key findings reveal that more than a quarter of respondents feel there is a gender imbalance in their current company, and over a third consider that they have not been given the same opportunities and/or reward as others due to their gender. Nearly half of our respondents have at some point felt the need to falsify, hide or deliberately not disclose at least one element of their identity: nearly 1 in 5 have hidden their age; 1 in 5 their political or social beliefs; more than 1 in 10 their religious beliefs and nearly 10% their level of education. Incredibly over 5% said they have even had cause to hide their gender.
Many respondents told us they have hidden their status as a parent or expectant parent, and some have even felt the need to hide a disability.
A US Government Accountability Office (GAO) study published in February 2019 showed some encouraging improvements in diversity between 2007 and 2015. For example, minority representation in management positions increased from 17.3% to 21% - a small improvement, but an improvement, nonetheless. However, the percentage of management positions held by women remained at 45%.
It seems that diversity is increasing, but it is slow progress and is not equally replicated in all areas. We have a theory that this small change is an indication that companies want to be seen to be ‘ticking the diversity box’, rather than truly recognising the potential benefits and actively improving diversity to boost the business, profitability, and customer service levels.
What are the benefits of promoting a diverse working environment?
With each generation our society becomes more diverse, yet the workforce within financial services has not kept up and does not mirror the rich diversity of society. It has been shown time and time again that diversity breeds creativity, innovation, wellness, employee satisfaction, lower staff turnover, better customer service, increased profits.
Recruiter Randstad has claimed that the UK economy would be GBP 24 billion bigger if those from BAME backgrounds progressed in their careers at the same pace as their white colleagues. A separate report, from McKinsey, entitled ‘Delivering Through Diversity’ showed that companies in the top 25% for ethnic diversity were 33% more likely to achieve profit above the industry average. The report also showed that more ethnically diverse boards were 43% more likely to outperform on profits and those in the top 25% for gender diversity were 21% more likely to achieve profit above the industry average.
With this evidence to show the benefits of diversity, it is clear that failing to meet diversity targets, means the financial services industry is not performing at its best. Therefore, we are not delivering the best service to our valuable customers or attracting the best future employees.
We were, however, encouraged by some of the other key findings in our research. For example, 88% of our respondents felt that increasing diversity would be beneficial – far outweighing the proportion of respondents who have direct experience of discrimination. And over half do not believe the industry does enough to encourage gender parity and diversity with respect to opportunity and pay, giving a clear indication that the wider industry is ready to get on board and work together to improve diversity, inclusion and equality.
As we talk every year, around the 8th of March on themes like diversity and closing the gender gap, what do you anticipate it will change in 2021?
It’s all about awareness – and by creating awareness there’s the opportunity to engender change in attitudes. However, we still have quite some way to go, nor is it an easy change. Change will take time and will rely almost entirely on active involvement from players across the industry, but will also bring significant benefits to the entire industry.
Improving diversity and inclusion across our industry would improve its reputation and encourage future generations to consider this a viable and attractive industry in which they could develop an exciting career. This will encourage more young people into financial courses, apprenticeships and careers, ultimately bringing significant benefits to all working in and using services provided by the industry.
About Miranda McLean
Miranda McLean, Global Head of Marketing at financial infrastructure provider, Banking Circle, has built a considerable reputation for developing and executing successful marketing strategies for a wide range of financial services businesses over more than two decades.
Miranda is on the Executive Board of the European Women Payments Network which champions diversity and inclusion in the financial sector.
About EWPN
European Women Payments Network (EWPN) is a platform for women working in Fintech, Cards & Payments with an objective to inspire, empower and mentor women in payments to help them realise their full individual potential.
About Banking Circle
Banking Circle is a financial infrastructure provider to Payments businesses and Banks. As a fully licensed bank, free of legacy systems, Banking Circle technology enables payments companies and banks of any scale to seize opportunities in the new economy - quickly, at low cost and with world-class compliance and security – with direct access to clearing that bypasses old, bureaucratic and expensive systems.
Banking Circle solutions are increasing financial inclusion. From accounts to lending, international payments to settlements and risk hedging to compliance, Banking Circle technology is helping thousands of businesses transact across borders in a way that was previously not possible.
Banking Circle is owned by EQT VIII and EQT Ventures in partnership with Banking Circle’s founders. Headquartered in Luxembourg, Banking Circle has offices in London, Munich, Amsterdam and Copenhagen.
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