Never mind gender parity – just having executive committees consisting 30% of women is still a long way off for the financial services industry.
At the current rate of progress, female representation at the executive committee level would not reach 30% until about 2048, according to a new study.
Previous research suggests that 30% is the level at which a minority voice in a group starts to be heard, Oliver Wyman pointed out in its study titled "Women in Financial Services 2016."
The findings – which also show almost no progress over the past three years in increasing the ratio of chief executive officers who are women – are a call to action, said several women who rank among the Most Powerful in Banking and Finance.
"In 2016, we don't have the luxury of more discussion about what should be done, or worse, determining if there is a problem for women advancing in financial services," said Patti Husic, president and CEO of Centric Bank in Harrisburg, Pa.
There is obviously a problem and the industry needs to commit to solving it instead of merely talking about it, Husic said.
As a way to tackle the gender imbalance at the top, many companies have introduced networking, mentorship and leadership programs. Some also have introduced or improved corporate policies related to work flexibility or parental leave.
Nevertheless, the Oliver Wyman study says such efforts have been "insufficient in retaining and advancing women over the long term."
The main problems are promotions, salary gaps and unconscious bias, according to Astrid Jaekel, a partner at the management consulting firm and lead author of the report.
"Women are promoted at lower rates and there's evidence of a pay gap in many countries," she said. "And then there's unconscious bias, which makes it much harder for women to navigate their organization and enjoy their jobs."
What companies need to do now is tackle the "invisible" issues: assumptions, values, perceptions and biases, Jaekel said.
The belief that the lack of women at the executive level is somehow tied to "women not having the same ambition levels or wanting to get out of their career anyway" is a direct reflection of the unconscious bias that is impeding further progress, she said. Such assumptions about women are connected to "traditional role expectations."
Having to deal with unconscious bias on a daily basis wears on women, Jaekel said. Companies must "interact with women in such a way that their career costs go down and the enjoyment of work goes up for them because they're faced with all this unconscious bias," she said.
Changing perceptions is a similar challenge. Often, there's a stigma associated with initiatives such as flexible work hours, and they are considered options for the less ambitious. So companies must change their work culture instead of merely giving employees the opportunity to work a flexible schedule, Jaekel said.
In the financial services sector globally, women make up just 16% of executive committees on average; in the United States, it is 20%, according to the study.
Further, female executives in financial services are 20% to 30% more likely to leave their employer than their peers in other industries. This is particularly apparent at midcareer, when the opportunity costs of the job start to outweigh the benefits for many women. "There is a midcareer conflict that is resolved too often today with attrition," the report says.
Those opportunity costs include persistent inequality when it comes to promotions and pay and the wearing effect of having to deal with unconscious bias. Other factors include lack of flexibility in work hours and lack of support in family responsibilities.
A bigger pipeline would help offset the impact of the mid-career exits.
"It's important to have a pipeline, which needs to be built and maintained," Jaekel said. "In order to see more change at executive levels, more women need to be brought through all the levels of the organization."
Katia Bouazza, head of capital financing for Latin America at HSBC, agreed.
"This industry seems to attract a lot of recently graduated women so we have a very high percentage there," she said. "But the share of women starts diminishing over time as they increase in seniority. It's something I see firsthand."
Husic talked about a "severe talent recruitment concern" that affects bank shareholders and the communities they invest in, along with the banks themselves. Repeating advice she had once heard from Beth Mooney, chairman and CEO of KeyCorp, Husic said banks should demand recruiters submit a diverse group of candidates for job openings.
"If women never make it to the landscape to be considered, we will never make a meaningful change in these numbers," Husic said.
She also stressed that top leadership is the most important component of implementing change.
"I can tell you from personal experience, no gender equity issue will ever be resolved without a bold top-down initiative directly from the CEO," she said. "He or she has to be the champion of this cause for measurable action to be achieved."
Husic said her executive team at Centric Bank is 60% women, including the positions of chief financial officer, chief risk officer and head of human resources. Female employees at Centric "see a clear path to advancement," because having women at the top makes it easier to visualize their advancement.
Bouazza said having women on the board also makes a difference. "When an organization has more women on the board, the diversity will trickle down faster."
Oliver Wyman surveyed 381 financial services organizations in 32 countries, 850 financial services professionals and interviewed more than 100 senior leaders both female and male.
The survey showed that growth in female representation between 2013 and 2016 stemmed primarily from roles that have not traditionally been held by women, like chief financial officer and chief risk officer. Women currently make up 15% of risk leaders, compared with 7% in 2013; and 14% of finance and strategy leaders, compared with 10% in 2013.
However, the most common roles for women at the executive level continue to be the head of human resources and the head of marketing (45% today compared with 46% in 2013). Just 8% of CEOs are women, up from 7% in 2013.