Joy Macknight

The 10th edition of OMFIF’s Gender Balance Index paints a gloomy picture when it comes to the progress made on senior-level gender equality at central banks, commercial banks, pension funds and sovereign funds.

The striking figure that sums up the Official Monetary and Financial Institutions Forum’s 2023 Gender Balance Index (GBI) is 140. It will take 140 years to reach gender parity in leadership positions across the financial industry, according to the think tank’s research.

In the words of Camille Blackburn, director of wholesale buy-side at the UK Financial Conduct Authority, speaking at the launch event in London: “The report is not pretty, but it is compelling.”

There are some stark truths laid bare in the GBI over the past 10 years, which covers central banks, pension funds, sovereign funds and commercial banks. In 2013, 21 of the world’s central banks had a female governor; a decade on, that number has increased by just one. Across the 336 institutions analysed, the proportion of female CEOs or equivalent remains at 14%.

But while the headline figure is quite gloomy, incremental progress is being made – for example, 41% of surveyed institutions saw their GBI scores increase in 2023.

According to the report: “Average GBI scores rose for each of the four groups this year, although only by one to two points. Pension funds continue to outperform with an aggregate GBI score of 50 out of 100 [where 100 reflects a perfect 50-50 split between women and men] – meaning they are just halfway to achieving gender parity. The global score for commercial banks and central banks is less than 40 and only 23 for sovereign funds.”

However, sovereign funds made the biggest improvement in the past year, with 27% increasing their GBI scores compared to just 8% of central banks.

The research found that Asia-Pacific is the most male-dominated region in the index. Its regional score is 20 or below for central banks, pension funds and sovereign funds. And the score for commercial banks fell to 29, from 30 in 2022. Regional scores for North America and Europe are above 35 across all institution groups.

On a more positive note, three out of the top 10 central banks come from Asia-Pacific: Reserve Bank of Australia (RBA), National Bank of Samoa and Central Bank of Myanmar. RBA is the only central bank from the G20 countries to make it into the top 10.

Speaking at the event, Michael Andersen, RBA’s chief representative, European representative office, outlined the central bank’s initiatives to help improve its gender balance and that of the financial sector as a whole.

First is RBA’s pipeline initiatives all the way from programmes encouraging women to go into science, engineering, technology and mathematics – as well as finance and economics – subjects at university through to leadership programmes, sponsorships and role modelling at the bank.

Mr Andersen grouped the second set of initiatives under a cultural umbrella. “Unconscious bias gets talked about a lot and it’s not just about calling out unconscious bias existing in society but delving into our unconscious biases when we have meetings. Are we talking over women? How can we encourage greater contributions? We have programmes in place for part-time work, job sharing.

“Covid-19 has taken a lot of stigma – for women and men – out of flexible working. And we have harmonised our parental leave arrangements – it is not just a policy for women,” he explained.

“We recognised that the gender pay gap is not just the remuneration that people get paid, but it is also when you go on leave without pay, you have a gap in your earning capacity that often doesn’t get realised until you retire. Another thing we have done is introduce the maintenance of superannuation contributions even when someone is on leave,” he added.

Developing a pipeline of new talent coming into the industry is critical to success, but so is retaining female talent throughout their career. Vivienne Aiyela, director, head of inclusion at Federated Hermes, touched on the work the global investment manager was doing to help address the fact that one in 10 women are leaving financial services as they go through the menopause.

“We need to keep mature women in play who can take the opportunity to go up to the C-suite,” said Ms Aiyela.

Federated Hermes’ menopause project team has rolled out listening circles through the gender network; specially trained menopause champions that are similar to mental health first aiders, who support female and male colleagues; and mandatory menopause training for line managers.

“This opens up the conversation to understand what the symptoms are, including hot flushes, fatigue, brain fog, etc,” she added. The team has also just released a menopause toolkit.

Clearly, the pipeline of future leaders remains biased towards men. “Only 22% of all C-suite members in commercial banks, pension funds and sovereign funds are women. Pension funds lead the way as the share of women in C-suites increased to 30% this year, from 26%. But this proportion was broadly unchanged at less than 20% in sovereign funds and commercial banks,” said the report.

In general, commercial banks are taking one step forward and half a step back on gender equality. According to the report, “GBI scores increased in 57% of commercial banks in the cohort, but fell in 35%. Regionally, scores only increased in Europe with notable progress at Standard Chartered, which leads the rankings with a score of 77. No other bank scores above 70.”

Joy Macknight is editor of The Banker. Follow her on Twitter @joymacknight

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