Gender diversity is not a “side-of-the-desk exercise”, the chief of the London Stock Exchange said on Wednesday, as figures show that there were almost 200,000 more women working in the UK’s finance sector in 1997 than today.
A report from the Centre of Economic and Business Research on behalf of the London Stock Exchange showed women in the sector have continued to earn less than men over the past five years.
Also since the mid-1990s, the proportion of women working in finance has steadily decreased.
In 1997 there were about 589,000 women working in the UK finance sector, whereas in 2022, some 26 years later, the number had declined by more than 30 per cent to just over 400,000.
It means the share of women in finance peaked in 1997 at 57 per cent, and has fallen over time, hitting its lowest point of 45 per cent in 2021.
Julia Hoggett, the chief executive of the London Stock Exchange, said the decline was partly because a much larger proportion of women worked in administration and clerical roles in the 1990s.
“Some of those roles were made redundant as a result of digitisation over the years,” Ms Hoggett said.
“But I have seen data that suggests, say in investment banking, there are occasions where women will disproportionately lose roles more regularly than men.”
Women across all job levels in financial services have continued to earn less than men over the five years to 2022, the report found.
And even though administrative roles were dominated by women, the weekly earnings of men in those positions remain higher and are growing at a faster rate.
Ms Hoggett said it was crucial that all companies collect and publicise data about their diversity and inclusion progress, so that they could be “held accountable”.
“Unless you systematically gather the data in order to see where those pinch points and those issues are, then you wont be able to change it,” she said.
“I don’t think this is a side-of-the-desk exercise. Diversity and inclusivity is a necessary to have, not a nice to have.
“When you think about it that way, it is not a nice distraction, it’s just part of the job.”
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Despite the number of women in finance declining over the years, the contribution of those women to the economy has been increasing.
Over 26 years, women in the sector contributed £1.12 trillion ($1.3 trillion) to the UK economy, in total value-add and when adjusted for inflation.
This equates to an extra £299 a household a year, the research centre said.
Ms Hoggett, who took over at the helm of the exchange in 2021 from her role as director of market oversight at the Financial Conduct Authority, said she had not found being female a “challenge” in her 25-year career in finance.
This was partly because she did not have to take time off work when her two children were born, she said.
“I have always had a sneaking suspicion that, actually, being openly gay has helped me in my career,” Ms Hoggett said.
“Sometimes if I took command in a board meeting, people would see that as ‘Julia being Julia’, when they might not say the same for a straight female colleague.
“To create the most value in an organisation you have to be inclusive.”
The research centre said that the “next frontier” for policymakers must be child care, specifically through measures such as shared parental leave, and for societal attitudes about it to change.
It follows a separate report from accountancy giant PwC on Tuesday, which found that women are being priced out of work because of soaring childcare costs.
It said that the “motherhood penalty” has become the most significant driver of the gender pay gap.
Updated: March 08, 2023, 12:01 AM