As we celebrate International Women’s Day (IWD) this weekend, Katharine Leaman (pictured), CEO of Leaman Crellin and advisory board member for compliance experts and training providers, Skillcast, shares some of the data that remind us why there’s still work to be done to create real gender diversity in financial services
As a female business leader and former investment adviser, I can’t help but notice some of the recent statistics around gender equity stagnation. I’m sharing some of this data, to spark conversations around how we, as organisation leaders, can reinvigorate our contributions to make our sector more equitable for future generations.
The stubborn persistence of the gender pay gap
Recent data paints a sobering picture. In today’s day and age, women in senior financial roles earn nearly 30% less than their male counterparts, a gap that has only narrowed marginally over the past five years.
This chasm is not confined to leadership positions however – across the financial sector, the mean gender pay gap stands at a staggering 35.4%, indicating that, on average, men earn significantly more than their female counterparts.
Even within institutions that champion diversity, progress is sluggish. In 2024, major banks reported only modest reductions in their gender pay gaps; for instance, one bank’s median pay gap decreased from 48.3% to 44.9%. At the same institution, women also continue to be underrepresented in top-paying roles, occupying only 17% of such positions. These figures underscore the systemic nature of the issue, where structural barriers perpetuate inequality.
A regressive trend in female leadership
The boardroom, often viewed as the pinnacle of corporate influence, further reflects a disheartening regression in gender diversity amongst finance professionals. In 2023, EY found that only 33% of new board appointments in UK financial services were women, a sharp decline from 61% in 2022. This downturn places the UK behind its European counterparts, with countries like France and Germany making far greater strides in female representation. At the time, the same report showed that over one in four (26%) listed UK financial firms had zero women in senior board positions.
Furthermore, the overall presence of women in senior board roles remains disproportionately low. Despite women comprising 44.4% of board directors at the ten largest UK banks in 2025, they hold only 24% of the four senior board roles, such as Chair, CEO, CFO or Senior Independent Director.
For women looking to embark on a career in finance, these statistics are far from encouraging. The disparity highlights the challenges those looking to climb to the highest echelons of corporate leadership can expect to face.
The erosion of diversity, equity and inclusion initiatives
Compounding these challenges is a troubling shift in corporate culture. Recent reports indicate that banks and corporations are scaling back their Diversity, Equity, and Inclusion (DEI) efforts, influenced by external political pressures and internal apprehensions.
Threatening to stall, or even reverse, the modest progress achieved in recent years, this lack of investment in DEI undoubtedly leaves women and minority employees vulnerable to systemic biases, as fewer efforts are made to educate, inform and induce positive change.
Embracing comprehensive strategies
To properly address the UK financial sector’s entrenched disparities, more has to be done than simply tapping the glass and hoping it will break. 2025 calls for a multifaceted approach that goes beyond superficial fixes.
Organisations must commit to transparent pay practices, ensuring that compensation structures are equitable and free from bias – benefiting all employees. Alongside this, robust mentorship and sponsorship programs can serve as a means of providing the support and opportunities suitable candidates, whatever their sex or gender, need to advance into their desired leadership roles.
Rather than treating DEI efforts as symbolic gestures, objectives should be written into core business strategies as a vehicle for meaning change. Stronger data-driven approaches, including transparent diversity reporting and genuine integration of DEI into leadership structures, will encourage accountability across all organisational levels. By investing in training that focuses on behavioural changes – rather than mere compliance – inclusivity becomes embedded in workplace culture.
In case this argument isn’t compelling enough, research from BGC shows that organisations that prioritise diversity and inclusion see a 50% reduction in attrition rates and demonstrate greater adaptability to market fluctuations. As businesses navigate shifting regulatory, social, and economic landscapes, those that integrate DEI into their everyday operations will ultimately be better positioned for resilience and sustained success.
Whether inspecting the benefits of a robust DEI strategy from a business or equality perspective, there’s no escaping the fact that true progress demands intentional action, and a commitment to lasting cultural change.
Gender diversity as a regulatory and risk imperative
The push for gender diversity in finance is not just about fairness – it’s a regulatory, operational and reputational necessity. UK Finance regulators, including the Financial Conduct Authority (FCA) have made it abundantly clear that diversity and inclusion are governance and conduct issues, not just HR concerns.
In 2024, the FCA proposed rules requiring firms to set and disclose diversity targets, with potential regulatory consequences for those failing to demonstrate meaningful progress. Failure to address this could invite scrutiny.
Beyond the regulatory expectations, gender-diverse leadership teams have been proven to enhance risk management and decision-making. A 2023 McKinsey report found that companies with diverse executive teams were 27% more likely to outperform their peers financially, while also demonstrating stronger governance and crisis resilience. These findings align with growing evidence that homogenous leadership groups are more susceptible to hive-mind thinking, leading to riskier decision-making and weaker oversight.
Inclusion is the engine that turns diversity into a true business advantage – unlocking a rich mix of experiences and perspectives that drive innovation and success. But, diversity alone isn’t enough. Organisations must foster a culture where every individual feels safe and comfortable to be themselves, empowered to contribute, and confident that their voice will be heard without fear of abuse, discrimination or backlash. These types of workplace cultures encourage active participation, and tap into a deep well of knowledge from unique backgrounds and insights.
Gender diversity is not a ‘nice-to-have’ initiative or scheme, it’s a critical factor in regulatory compliance, risk mitigation and sustainable safeguarding. Financial institutions must treat it with the same urgency as any other stability and reputation risk.
Shattering the illusion of equality
The journey towards gender equality in the UK’s financial services sector is far from complete. The persistent pay gaps, declining leadership representation, and waning DEI initiatives serve as stark and very real reminders of the work that’s still needed to be done.
As industry leaders, we must confront these challenges head-on, dismantling the barriers that perpetuate inequality, and play their part in cultivating environments where talent and ambition are true catalysts for success.
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