Prime Minister Theresa May criticised Britain’s finance industry for failing to promote and retain women on Tuesday as the government revealed that some of the biggest players have committed to having at least 30 percent in senior roles by 2021.
The Treasury said that for every pound earned by a man in the male-dominated financial services industry – the highest paid sector in Britain – a woman earns just over 60 pence, while women account for only 23 percent of boards and 14 percent of executive committees.
“The UK is a world-leader in financial services, but the sector could do even better if it made the most of many talented women who work in finance. Too few women get to the top and many don’t progress as quickly as they should or they leave the sector completely,” May said in a statement.
At the current pace of change it would take 30 years for women to attain just 30 percent of the seats on executive committees – the level at which research suggests a minority’s voice can be heard, a report by Oliver Wyman found.
May became only the second female British prime minister after Margaret Thatcher in July following David Cameron’s departure as Conservative party leader in the aftermath of the country’s surprise vote to leave the European Union.
She has since taken aim at the British establishment as she seeks to show she understands the frustrations of many voters which showed through in the June 23 referendum result. Major British banks have been widely unpopular in Britain because of the role they played in the financial crisis.
May’s predecessor launched the Women in Finance Charter in March following a review of how to get more women into senior financial services roles. This was led by Virgin Money Chief Executive Jayne-Anne Gadhia, one of the most high-profile women in the sector.
Her review recommended that internal targets be set for gender diversity in senior management, that pay packages be linked to a firm’s gender balance, that companies appoint an executive responsible for gender, diversity and inclusion, and that companies report gender statistics publicly.
By July, 72 financial firms had signed up to the initiative, but no formal targets or quotas were announced.
While 60 of these have committed to a 30 percent target, including HSBC (HSBA.L), RBS (RBS.L) and Lloyds (LLOY.L), only 13, including the Financial Conduct Authority, Virgin Money and Legal and General, are aiming for a 50/50 split.
Of the signatory firms, 20 named their CEO as the senior executive accountable for progress against their targets, the Treasury said in a statement on Tuesday, adding that the next group to sign up to the charter will be announced in November.
While Britain has opted for voluntary targets, other countries have adopted quotas to ensure gender balance across business, not just finance.
Of the 12 largest countries in Europe, five have mandatory quotas for female board representation: Belgium, France, Germany, Italy and Norway, according to a European Women on Boards study in April.
This report also said that countries where mandatory quotas on board gender diversity at listed companies were introduced between 2011 and 2015 tended to experience high levels of growth in the percentage of women on boards over this period.
However, Britain dropped from sixth to eighth place in the ranking of female board representation, according to the study, while Norway ranked first with 39 percent of board seats held by women, compared to 23 percent for Britain.