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Are financial services firms becoming more gender diverse?

In July, we announced that we'd signed the Women in Finance Charter, which is a government-led initiative designed to champion gender diversity within the sector.

We've joined some of the biggest names in UK financial services, including Lloyds Banking Group, Barclays, PwC, Aviva, Royal Bank of Scotland and Santander. Gender equality is a topic that we're very passionate about at Affinity Capital, and we're confident the charter will have a huge impact on the industry moving forward.

"Too few women get to the top, so they leave the industry prematurely because the culture isn't right."

But how are financial services firms currently performing on gender issues? It's a question that has hit the headlines again this month after new Institute for Fiscal Studies data showed women earn 18 per cent less, on average, than men in the UK.

The gap between the genders is especially wide when comparing men and women with A levels or who have completed higher education. According to the report, the two sexes are relatively even in earnings until the arrival of children, with new mothers seeing their careers hindered by taking time off.

Driving company performance with diversity

Improving gender diversity at the senior levels of organisations can have a significant impact on performance. Statistics from EY indicate that organisations with at least 30 per cent female board members can see net margins increase as much as 6 percentage points. Women can also help businesses tailor their offerings to meet the needs of a wider customer base

"Ensuring gender balance and diversity at all levels in organisations is not just the right thing to do, but companies who do so innovate more and are more successful," said Sandra Lawler, director of alternatives and former EY Entrepreneur of the Year.

In 2011, Lord Davies reviewed FTSE 100 companies and found only 12.5 per cent of board members were female. At the time, he set a target of doubling this figure by 2016 – and firms achieved this late last year.

Lord Davies has since outlined a new goal of reaching 33 per cent female representation within the next four years.

Gender diversity in finance. Finance firms are trying to boost gender diversity on boards.

Gender equality in finance

Despite some progress, it seems finance firms are slightly behind the FTSE 100 average, with a New Financial survey finding 23 per cent of board directors at financial services companies are women. Meanwhile, only 14 per cent of executive committee members are female.

Virgin Money supported the release of the New Financial report, and the organisation's chief executive, Jayne-Anne Gadhia, said diversity remains a key issue for businesses within the sector.

"Too few women get to the top, so they leave the industry prematurely because the culture isn't right, and this needs to change," she explained.

Here at Affinity Capital, we hope gender equality in financial services continues to remain under the spotlight. While accusations of being an old boys' club are not as accurate as they once were, there is obviously still plenty of room for improvement and we're keen to help make that happen.

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