Towards a fairer financial future for all

Jane Portas has perhaps the perfect background for tackling the gender pension gap – the gap between women’s and men’s income in old age. A scientist by training, she has spent 30 years in financial services, mainly focused on risk regulation and business strategy. Her interest is in the moments in a person’s lifetime where the risk of a financial hit on earnings is most likely and where more awareness and support is needed.

Jane, who will be the keynote speaker at WMPeople’s Top Employer Awards in February, is the creator of 6 Moments That Matter, a life stage approach for people and organisations to secure financial wellbeing and fair financial futures. She has worked in professional and financial services for 30 years, a sector that has one of the largest gender pay gaps and where a lot of work has been done to improve the representation of women, particularly in more senior roles.

She says that the reason many people don’t understand the gender pension gap is that they don’t understand the root causes of the gender pay gap, particularly the difference between equal pay and the gender pay gap, which is caused by the kind of work women do, how it is valued, the impact of an unequal division of caring responsibilities and more. Moreover, she says, for some deeply embedded social attitudes about roles, money and lifestyles mean they struggle to recognise it. “To understand the gender pension gap you need to understand the gender pay gap and what pensions are, which is quite a big challenge for many people. It’s not surprising given the complexity of the issues that no-one wants to think about it,” she says.

Spotting an opportunity

What she spotted, however, was an opportunity not just to boost women in the financial services sector, but for the industry to play a game-changing role in women’s economic advancement more generally. So she co-founded Insuring Women’s Futures with two other women under the aegis of the Chartered Insurance Institute. Their commitment was to a professional, joined-up approach across business, employers and providers of financial services to improve women’s financial security.

The organisation launched in 2016 before gender pay gap reporting was introduced and when there was little talk about the gender pension gap. The first thing Jane did was to work on establishing that there was a financial gap between women and men and to understand what the root causes were. For her it was about applying her work on financial risk to people.

Jane, who was recently awarded an OBE for service to business and equality, looked at the whole of people’s lives, from education choices and relationships to work and health and identified where financial gaps arise and she compared the experience of men and women. She has also considered other protected characteristics including ethnicity and disability. From that study of men and women she was then able to identify 12 financial wellbeing ‘risks in life’ and six ‘moments that matter’ where greater awareness and information can help in terms of a person’s financial security, recognising that everyone is different and that life is increasingly flexible. These include decisions about what you study or what job you choose and the impact of an adverse life event such as divorce and ill-health. In some cases it became clear that the protection in place has not kept pace with the way we live our lives, for instance, in relation to rights for those who co-habit compared to those who marry.

Jane says she was really shocked to discover that abuse – both domestic and economic – was one of the 12 financial wellbeing risks. To her knowledge, no-one had ever looked at life through a joined-up risk management lens to identify the lifetime financial risks. “The gender financial gap is not about women per se; it’s about understanding the different influences and life patterns that give rise to these gaps in equality and financial fairness,” says Jane. It’s a cumulative impact which affects not only people’s income and financial security at different periods of their lives, including old age, but the UK’s overall economy as the population ages. “My work is really about the economics of people,” she states.

Taking action

With the framework in place, Insuring Women’s Future looked to take action. It put together a group of 150 experts from across industry, policy and the insurance, personal finance and third sectors, to look at the key financial wellbeing risks, including parenthood, flexible working, financial capability and inclusive customer approaches. Jane authored the project’s manifesto, ‘Living a financially resilient life in the UK’, with 10 recommendations distilled from the previous work which focused on what could make the most impact at each of the moments that matter.

Jane says her work aims to highlight what individuals, employers, financial firms and policymakers can do in the moments that matter to improve financial wellbeing and fairness and ensure risks in life don’t have a lifetime impact on people’s earnings and savings. “Business leaders are effectively guardians of their employees’ financial livelihoods,” she says. By being aware of this they can take action to ensure people have fairer financial futures – and not just their employees. Employers, particularly those in financial services, also have a big role to play when it comes to educating and supporting their customers. “Employers are a pivot point between how people engage with money and their pensions,” says Jane. “We need to give everyone the confidence to be informed about their life decisions so they can empower themselves financially.”

Jane‘s current focus is a financial learning start-up which aims to make it simple for people to navigate money and life to secure financial wellbeing for the life they want to lead. She also produced a recent study in support of the charity Surviving Economic Abuse, highlighting on the root causes of economic abuse across a person’s life course and how it interrelates with other financial risks. This identified how employers and financial firms can help address economic abuse and led her to develop a financial wellbeing guide to support survivors. “Economic abuse is not so well understood,” she says. “It’s a form of coercive control, but it can be hard to spot the signs. It’s really important to raise
awareness about how people experience it.”

Providing solutions

Jane says Insuring Women’s Futures is very proud of some of the outcomes of its work which illustrates the power of a market coming together. For instance, the Money and Pensions Service has adopted a gendered approach to financial wellbeing.

She says: “If we are all empowered about how financial wellbeing and fairness gaps arise, we can put protection mechanisms in place and make positive choices that support financial security and don’t widen existing financial gaps. That is what empowerment and equal opportunities are about and is what my work strives to do – to create awareness in a factual, non-judgmental way and provide solutions.”

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