It is now universally accepted that greater diversity really does have a positive impact on core organisational outcomes and the benefits of truly representative teams—namely the advantages of having greater access to different perspectives and sources of information—are widely recognised. However, achieving true diversity in the top levels of financial services continues to be a challenge for the sector.
Looking at gender diversity alone, research from the Financial Conduct Authority has found that if we continue on the current path, the global financial services industry will finally reach the figure of 50 per cent female representation on executive committees by 2107: some two hundred long years after the first female suffrage march on Parliament. However, BAME professionals, those from lower socio-economic groups and disabled individuals are also significantly underrepresented across the sector. But why is this? And how can we switch the dial to boost inclusion?
The reasons behind under-representation of specific groups within financial services are deep and complex. Earlier this year, the Treasury Committee found that a culture of long hours and ‘presenteeism’, along with a stigma around flexible working as “female” and somehow less desirable, are among a number greater gender diversity in the Square Mile. However, the tendency for decision makers to offer opportunities to those in their immediate network—or at the very least, ‘hire in their own image’—also has a part to play in hampering wider inclusion. Add to this the fact that job specifications have, historically, focused heavily on past experience and academic achievement, and it’s no wonder that many organisations are failing to tap into a huge chunk of available talent —to their detriment.
Diversity and financial performance are indisputably linked. Previous research from Alexander Mann Solutions, for example, has found that women outperform men in financial trading thanks to their more risk-adverse and measured approach. However, our study of 350 individuals over a four week period seems to accurately mirror the wider business environment: the most recent research from McKinsey has found that that companies in the top 25% for gender diversity were 21% more likely to see higher than average performance than those in the bottom quartile—the figure for ethnic diversity was even higher.
With this in mind, business leaders are increasingly questioning how they can remove barriers to attracting and developing diverse talent so that they too can become more balanced, well-rounded and profitable. The answer lies in harnessing technology effectively.
From the earliest stages of the recruitment process, hiring decisions can be clouded by—often unconscious—bias. You only need to look at previous research by Harvard Business School, which found that black and Asian job applicants who masked their race on their CVs received nearly double the amount of requests for interview, to see that stripping away unnecessary detail results in more objective decisions. By automating recruitment processes to anonymise applications – removing information such as the jobseeker’s name, gender, the school they attended and extra-curricular activity that may suggest social status -businesses are forced to make truly objective decisions.
Once unsuitable applicants have been seeded out of the process—based on their ability to do the job alone—technology can be then be deployed during assessment. This ensures that all candidates are not only measured against the same rigid criteria, but also that the results of any tests can be stored and analysed against other applicants and existing high-performing employees. Of course, there will always be a place for human hiring managers when it comes to making the final call on a job offer. However, by investing in creating ‘blind’ recruitment processes where decision makers are not unintentionally swayed by preconceived ideas around gender, age and ethnicity, businesses can help level the playing field and boost inclusion. Diversity and technology are arguably the two hottest topics in talent management circles today. By harnessing one to influence the other, business leaders can help to ensure that teams profit from the benefits that greater diversity brings: reduced groupthink, more open discussions and better financial performance.
About VANESSA BYRNES
Vanessa Byrnes is the sector managing director of retail banking & insurance, Alexander Mann Solutions. where she is globally responsible for the integrated growth and service delivery of talent acquisition & management solutions to all Alexander Mann Solutions clients within the Financial, Insurance & Retail services sector. Over the last 19 years, Vanessa has held a number of roles within Alexander Mann Solutions including, Global Director of Client Services, Global Account Director, Practice Director for Telecommunications & Enterprise and the Director of People Capital. She currently sits on the Alexander Mann Solutions Global Operations Board