Inclusive workplaces for the financial services sector
The financial services sector has embraced diversity and inclusion for its customers.
For instance, it is well-represented within The Valuable 500, a global collective of 500 CEOs and companies committed to diversity and inclusion. Membership is an A to Z or a ‘who’s who’ of household financial names, including Accenture, Aviva, Barclays, Deloitte, HSBC, KPMG, Lloyds, Nationwide and many more.
Being a signatory means a public commitment to encouraging board-level representation of disability and discussing DEI issues at the board level.
Banks have embraced technology that makes life easier for customers, such as biometrics as an alternative, password-less approach to security. And most financial institutions have initiated diversity and inclusion programs for their employees and customers.
How advanced is D&I in the financial services sector?
However, others argue that the financial services sector is just beginning its D&I journey.
Notably, female representation within the financial services sector still has a way to go. A report by Deloitte Insights found that, globally, women held 21% of board seats, 19% of C-Suite roles and 5% of CEO positions in 2021. European financial services firms monitored do have female representation at the boardroom level, but the current gender split is male-biased (63% male versus 37% female, says EY).
In addition, Mercer reports that among financial services organisations, there are fewer women compared to men entering the workforce, and women are hired at lower rates compared to men at all levels except the senior manager level.
Flexible working encourages diversity in the workplace
Introducing flexible working can promote diversity in the workplace, specifically for women who are more likely to fill caregiving roles for children and other family members.
Workplace flexibility is increasingly important, especially for women, who are still more likely to fill caregiving roles for children and other family members. The financial services sector has embraced flexibility, including remote working, compressed workweeks and part-time schedules.
However, only 45% value remote working as much as in-person working, and only 42% of leadership actively promotes the uptake of flexible work options for all employees, according to Mercer.
Being flexible can also bring more disabled people into the workforce. A report by Los Angeles Times claims that Americans with disabilities are enjoying an unprecedented employment boom — thanks to the COVID-19 pandemic. It attributes this boom to the widespread acceptance of remote working. In the UK, disabled workers are more likely to want to work at home, a TUC report found.
The TUC found over 90% of disabled people who could work from home during the pandemic wanted to continue some form of home-based work in the future. At the same time, FSCB research suggests that half of financial services employees want to work more flexibly post-pandemic.
One main benefit of working from home is that it can grant disabled people more autonomy over their working environment, allowing them to manage their conditions more effectively. This notion is supported by the fact that, according to one study conducted by Lancaster University, most disabled people want to work from home between 80% and 100% of the time.
Financial services: an inclusive workforce?
Precise figures for how many disabled people are represented within the financial services workforce are difficult to find.
A diverse workforce, however, doesn’t mean it is inclusive, and we know that there is work to be done. Financial Services Culture Board (FSCB) data found that 56% of those with a disability said they felt under excessive pressure at work, compared to 38% of those without a disability.
Encouragingly, FSCB reports that 89% of respondents said that their managers promoted an inclusive environment at work, and employees who agreed that their managers did this were also considerably more positive across all questions than those who disagreed.
Yet, disabled employees were twice as likely to say they did not have fair access to progression as those without a disability. While employees with a disability answered most questions more negatively than those without, the greatest difference was having fair access to progression opportunities.
Challenges to implementing diversity and inclusion in financial services
The financial services sector hasn’t been diverse, according to Gartner, which says, “Leaders struggle to manage a more inclusive work environment because the financial services industry has not historically been diverse, and this is a new-to-world concept for many leaders.”
The financial services sector must also address the ‘why’ behind D&I programmes. A report by PwC found that institutions aren’t approaching diversity and inclusion with the right intent. Its survey found three in five (61%) only develop D&I programs to attract and retain talent or to comply with legal regulations, 17% are looking to achieve business results and 7% to respond to customer expectations.
The Financial Services Culture Board survey found that 19% of respondents were worried about being judged on their ability based on stereotypes about their identity or background. 17% of employees worried about the negative consequences of raising a concern, and a quarter was unsure or did not feel listened to when speaking up.
Elsewhere, there is evidence that many reasonable adjustments for disabled people in the workplace haven’t transitioned to the home office. The TUC found that many lacked the equipment to do their jobs, such as a desk, chair or computer (34%). Others experienced difficulties participating in online meetings (9%) and lacked the specialist software they needed to do their jobs (7%).
Why the financial services sector must become more inclusive
The financial services sector must embrace diversity and inclusion. The FCA, PRA and the Bank of England published a joint discussion paper in 2021 proposing better collection and publication of D&I data. The aim is to drive greater diversity and more inclusive cultures within the financial services sector, creating positive outcomes for customers, firms and markets.
On ‘softer’ issues, the FCA expects that appropriate culture can be implemented and maintained in a remote or hybrid working environment. Firms have considered the impact of working arrangements on staff, including well-being, training, diversity, and inclusion.
Under the Equality Act 2010, it is unlawful to discriminate, harass or victimise people on the grounds of a protected characteristic under the Act. Those characteristics are age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, and sex or sexual orientation.
Organisations must anticipate and make reasonable adjustments to avoid people with disabilities being at a disadvantage.
What is ‘reasonable’ will vary from case to case depending on the individual circumstances.
Expert in employment law Jon Fisher of Pinsent Masons, the law firm behind Out-Law.com, said, “Of the duties under the Equality Act, the duty to make reasonable adjustments for people with disabilities is the most complex and the most difficult to comply with.”
However, Diversity is moving up the agenda in FS organisations – and rightly so.
Why the financial services sector should embrace diversity and inclusion
As well as being the right thing to do, it makes business sense. According to PWC, more than 75% of the FS CEOs who have adopted a strategy to promote diversity believe it is helping them to enhance innovation, customer satisfaction and overall business performance.
FS industry leaders taking part in PwC’s 18th Annual global CEO survey have a strategy to promote diversity and inclusiveness (59%) or plan to adopt one (14%).
A 2019 McKinsey & Co. study revealed that top-quartile companies for racial and ethnic inclusion outperformed those in the fourth quartile by 36% in profitability, according to CFA Institute.
When supported effectively, disabled employees tend to have fewer absences and remain with their employer for much longer than non-disabled employees, retaining talent.
How ClearTalents can support inclusive workplaces in financial services
According to the Financial Services Culture Board, when asked what leaders could do to make their organisation more inclusive, 19% suggested listening and openness.
Listening is key to understanding a diverse workforce. ClearTalents enables your staff to create an Inclusion Passport, which identifies needs so that you can make reasonable adjustments in the workplace, including flexible working and introducing assistive technology.
Contact us to find out more.