The financial sector is becoming more creative and effective in its efforts to attract, retain and promote more women, but it doesn't stand out as a beacon of innovation. Having said that, there's no single trail-blazing industry in this area.
Across broad sectors and within individual companies, there are "pockets of innovation" to promote gender diversity, and firms should seize upon new and creative solutions that have proved successful regardless of industry vertical, suggests Helen Wells, director at Opportunity Now.
"City firms come in for a lot of criticism when it comes to gender diversity, largely because they're starting from a point where their culture is very macho and male-dominated," she says. "Some of the banks are doing an awful lot to change this, but it's a long process that requires a lot of hard work."
So, what are financial services firms doing?
Targeting talent early on
In terms of attracting talent, banks are targeting potential female candidates increasingly early. There's no shortage of events targeted at university students, such as Fresh Look – where senior female managing directors within nine investment banks (Bank of America Merrill Lynch, Barclays, Credit Suisse, Deutsche Bank, Goldman Sachs, J.P Morgan, Morgan Stanley and Nomura) look to inspire first-year students towards a career in the sector.
However, more banks are targeting girls undertaking their A-levels or even in secondary school, offering insight days where students have a chance to network with senior staff and learn about the skills needed to work in the industry.
Bank of America Merrill Lynch's president of global markets and banking Tom Montag, said last year that the bank intends to recruit equal numbers of men and women graduates going forward, while Goldman has claimed to be reaching the 50% mark at entry level.
The reality is, however, banks are still some way off reaching gender parity. Our own research suggests that this year investment banks have attracted only around 20% of total applications from women. RBS was singled out for special praise from Opportunity Now in 2011 for its scheme to challenge women's negative perception of investment banking and encourage more female applicants.
It has been successful, increasing the number of female recruits from 24% in 2009, but the target is still only to ensure 35% of new graduate hires are women from 2012.
More innovative schemes are needed, and a select group of firms are now inviting potential recruits into an organisation to shadow senior female executives. J.P Morgan's Winning Women is one example of this, and PwC has received 400 applications for its new female partner shadowing scheme due to kick off this summer.
Providing an extra leg up to the top
Steven D'Souza, former head of diversity for global wealth management EMEA at Bank of America Merrill Lynch and an associate at law firm Byrne Dean, says that banks' tactics to engage and retain women include: "Providing training, establishing affinity groups, providing support for women returning after maternity leave and working collectively to promote banking as an industry for women in secondary schools."
Mentoring is also another common approach, ensuring that female employees have access to a more senior colleague who can offer career guidance, advice and solutions.
More specifically, last year Citi was given an award from Opportunity Now for its 'Coaching for Success' programme that aimed to fast-track women in EMEA at VP level by expanding their skill-sets. The project reduced the attrition rate from nearly 17% to 8%. Barclays was also given special credit for its series of networking events aiming at addressing gender imbalance.
However, in the last year, more financial services firms have started formal sponsorship programmes to help high-potential female employees make a step up to the upper echelons of the organisation, says Wells.
"Mentoring is more about sharing advice and wisdom, whereas sponsorship is about kicking doors open," she says. "More and more we're seeing senior men within City firms sponsoring high potential women; putting them forward for promotional opportunities, giving them stretch assignments and leveraging their network to ensure she is introduced to key colleagues and peers. This is helping women two or three roles below board level take the next step up."
A 2009 study by Harvard Business Review suggested that high-performing women were often denied sponsorship opportunities to make it to the top. The reasons for this were numerous – not least that women wanted to progress on merit, not connections – but key among them is the fact that sponsorship could often be misconstrued as sexual interest. By formalising this process, banks are looking to avoid this potential pitfall.
Targets not quotas
The UK government is already tentatively threatening to impose quotas unless companies appoint more women on boards. This would follow on from Norway, which adopted a quota system in 2008, and Germany, where blue-chip Dax 30 companies accepted voluntary quotas last year.
At an entry level, as we pointed out above, financial services firms are already rolling out target numbers of female recruits and these are also being spoken of further up the ladder, suggests Wells. Quotas, however, are currently frowned upon.
"Targets set metrics of accountability, and can be viewed as an aspiration. The problem with quotas is they don't get to the crux of the commercial argument or receive much senior management buy-in," she says. "You need to create change in the organisation so women are recruited and promoted on their own merit. No one wants to be part of a quota."
Women in Finance:
Can gender diversity drives survive as the financial sector contracts?
Five sectors still struggling to attract female candidates
Q&A: Emma Murphy, advisor to the Financial Policy Committee at the Bank of England
Avoiding the mummy track: How to juggle a family with a high-powered financial career