Article – Women in Finance

The financial sector, just like most others, is still home to a lot of inequality and discrimination regarding gender. The fact that only 18% of the CFA members are women is one that clearly describes the current situation. In this text, we will explore some of the suggested academic explanations for the existence of this gap, and go through an example of female leadership in the world of finance.

A key factor to understanding the existing gender inequality in the job market, including the financial sector, is that most women become mothers and have more obligations than men outside of their job. Currently, “(…) despite outnumbering men in the paid workforce, women still have almost twice the domestic and childcare responsibilities of their male counterparts” (Harvard Business Review, May 2020).  Mothers suffer immense discrimination in the workplace, starting with a pay gap (relative to non-mother women) that is bigger than the one between men and women, at least for those under 35. They are perceived as less competent and productive than women without children, something that has been subject to academic research, and proven to be largely inaccurate. On the other hand, fathers do not experience these disadvantages, as “understandings of what it means to be a good father are not seen in our culture as incompatible with understandings of what it means to be a good worker” (Correll, 2007).The financial sector rewards people who are willing to work inflexible and long hours, something that most women can’t or don’t want to conciliate with their personal responsibilities.

According to OECD data, only 18% of the board members in the top 500 finance firms are women. This is problematic in various ways. Besides representing the barriers women face along their careers, it is detrimental to the success of the firms, since gender diversity among board members has many proven benefits. The presence of women on the firm’s boards leads to improved discussions and decision-making while increasing both the members’ accountability for poor performance and the effort put into good monitoring. “Overall there are several studies that document a positive relationship between gender diversity on the board and corporate performance.”.

Thasunda Brown Duckett, CEO of Chase Consumer Banking, is one of the few women represented in the top 500 finance firms. The finance leader recognized for her work on inclusion for people of color in the financial system has taken over from retiring chief Roger Ferguson Jr. in a rare handoff among two black chief executives. She manages a banking network with more than 800 billion dollars in deposits and investments and 50,000 employees and is accountable for the bank’s development of new instruments and products to enhance financial health and wealth for all consumers.

Duckett came to our attention while doing the research for this article since she is one of the few black women with a major role in the financial world. In an interview with Adriann Negreros, Duckett talks about how to change social inequities by believing in the art of possibility: “I think that it’s important that when we are in positions of power, that we understand the platform and that we understand that it’s more than just delivering on the financial results,” Duckett says. “It is about shaping a culture, it is about using our voice to make real progress in our country, and I think that’s good for business, it’s good for the community, but it’s also, for me, why I believe I’m in this seat.”.

As women embedded in areas of economics and management, we recognize that our challenges emerge particularly larger. Even though gender isn’t a problem in the financial services industry, where women account for more than 50% of the workforce, the percentage of women in leadership positions is a different matter. With examples like Thasunda Duckett’s career in finance, we remain optimistic about a future where more women occupy leading corporate positions and hope that our wealth gaps shorten as the years go by.