Diversity has become a growing focus for a variety of industries in recent years. But while some sectors have begun to make headway in creating inclusive work environments, the male-dominated financial advice industry arguably has some catching up to do.
The notion of changing the traditional makeup of an industry is by no means an easy task, especially when its very nature was based on roles traditionally reserved for men.
Considering the fact the concept of women handling their own income was not officially legislated for until 1990 – when the government introduced independent taxation – it makes sense that the advice sector, which tends to skew to older practitioners, has not moved as swiftly as others.
But the nature of financial advice has changed almost as quickly as attitudes to gender. In the years prior to the Retail Distribution Review (RDR), when advisers relied on commission payments for recommending certain products, the industry was very different in structure.
Danny Cox, chartered financial planner at Hargreaves Lansdown, says the lack of diversity among financial advisers is in part due to this legacy. Mr Cox says: “If we go back 20 or 30 years, financial advice was much more about sales than it was about advising, and that’s more naturally a type of role that a man would take, rather than a woman at that time.
“But also, on top of that, if you were working for a large national firm as a financial adviser such as a bank, it’s often harder to have the same flexible working schedule as you might have if you were working for yourself.”
Published a few months before the RDR, the Institute for Leadership and Management’s 2012 research paper Women in Banking revealed that 76 per cent of women felt that “opportunities for working flexible hours or working from home would be a benefit”.
Encouraging participation
Most efforts to widen participation in financial services have, understandably, focused on larger industries and organisations. HM Treasury’s Women in Finance Charter, launched in March 2016, asks businesses to consider how they should address diversity issues. Signatories must have a senior executive with responsibility for gender diversity and set targets for women in senior management positions (see Box 1).
Robo advisers Nutmeg and Scalable Capital are two of the handful of smaller firms to have signed up, alongside a host of banking, insurance and fund management giants.
The Women in Finance Awards, an “awareness initiative designed to identify and celebrate role models and advocates in financial services and business”, does focus in part on the achievements of female financial advisers.
Praseeda Nair, spokesperson for the awards, says the category “recognises women who are leading the charge for opening up the world of money management, mortgages and investment to women”.
Ms Nair adds: “The only way to break old habits [in the financial advice industry] is to challenge out-dated workplace culture, whether it’s lad banter at work, machismo culture that makes shared parental leave near impossible, or tokenism in hiring women just to tick boxes.”
