Falling numbers of women at top levels in financial services sector

Appointments of female board directors to the UK’s largest financial services firms fell by 28% between 2022 and 2023, according to the latest EY European Financial Services Boardroom Monitor, which reports that just 33% of all appointments last year were of female directors, down from 61% in 2022.

A downward trend in female appointments was also seen across European financial boardrooms, albeit to a lesser degree, where female appointments declined seven percentage points.

While all UK financial services firms monitored have female representation at boardroom level, the current gender split across all firms stands at 57% male and 43% female – remaining unchanged from 2022.

The report shows that this year, of major European markets, the UK had the lowest proportion of female appointments to financial services boards (33%), falling behind France, where 64% of board directors appointed in 2023 were female, Germany (54%), Italy (45%) and Switzerland (43%). However, the UK has fewer financial services firms with less than 40% female representation in their boardroom.

C-suite experience was the top criteria for new board recruitment in 2023, with 81% of new appointments to UK financial boards during the year bringing current or past executive management team experience. Of directors with c-suite experience appointed to UK financial firms this year, just 36% were female, down from 50% in 2022.

Across UK financial services boardrooms, female directors remain significantly less likely than their male counterparts to have the experience of c-suite role or hold a senior board position. 58% of female directors have the experience of an executive management team role, while 77% of male directors have similar experience. There are no women in senior board positions (Chair, CEO, CFO or Senior Independent Director) at 26% of the UK’s listed financial firms.

UK financial boards have used the opportunity of new appointments to continue to expand political, technology and sustainability skillsets and experience this year. Of directors appointed in 2023, 37% bring political experience (down from 39% in 2022); 30% have professional experience in tech (up from 22% in 2022) and 15% have professional experience in sustainability/ESG (down from 31% in 2022). In the past year, a greater proportion of female directors have brought experience in tech (44%) and ESG (22%) relative to male peers, 22% of whom have tech experience and 11% have ESG and sustainability experience.

Promotion barriers for parents

Meanwhile, a new report by www.leadersplus.org released next week suggests that working carers are being excluded from promotion because of their caring responsibilities, particularly mums.

Out of the nearly 1,000 parents and carers surveyed, 60% said they felt unable to progress in their careers because of their responsibilities at home.  The figure was significantly higher for mums than dads with 67% of mothers feeling stuck at a certain level vs 43% of men.

Of the 60% who felt unable to progress in their careers, 85% of the respondents believed the workload of a more senior role would be unfeasible alongside their caring responsibilities and decided to not apply for this reason.

A culture of presenteeism and over-work is seen as impossible for working parents to succeed as parents see other candidates putting in ‘extra time and capacity’ to gain an advantage, which they are not in a position to do. Childcare costs were also another big factor.

Verena Hefti, founder of Leaders Plus, believes that managers need to do more to encourage carers to apply for promotion: “Our research shows that a majority of working parents want to progress their careers and actively seek out employers where they can picture themselves in a more senior role without sacrificing the bond with their children. Too often, they don’t see how they can progress at their current employer.”

“Employers must recognise this and provide targeted support to this group of employees who are underrepresented in senior leadership. Failing to do this will harm the female talent pipeline and make closing the gender pay gap near impossible.”

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