WAIFC Issues Groundbreaking Guide on Gender Diversity in Finance: “Women in Finance – Compendium of Good Practice”

Cover and contents pages of the "Women in Finance - Compendium of Good Practice" working paper by the World Alliance of International Finance Centers. The cover contains a watercolor world map.
John Lothian

John Lothian

Executive Chairman and CEO

Gender equality is an issue across all business sectors. The Financial Services industry has particularly struggled despite many efforts to make progress, and the derivatives, hedge fund, and private equity areas have lagged even more so. To share practical examples of ways to attract and retain women at all levels of these organizations, and encourage companies to try new ways of addressing this critical business and social issue, the World Alliance of International Financial Centers (WAIFC) has issued a guide titled “WOMEN IN FINANCE – COMPENDIUM OF GOOD PRACTICE.”

Lamia Merzouki, vice chair of the World Alliance of International Financial Centers board, emphasizes the critical importance of women’s leadership in finance, advocating for equitable representation to create inclusive financial products and services. The guide outlines WAIFC’s commitment to gender diversity, highlighting initiatives like the Women in Finance project and the Gender Pledge. Key strategies include enhancing board representation, implementing family-friendly practices, addressing the gender pay gap, and attracting more girls to finance through education programs. By profiling senior women and celebrating successes, WAIFC aims to foster a more inclusive, innovative, and resilient financial industry.

This is what Merzouki had to say in the introduction of the report:

The importance of women’s leadership and participation in finance cannot be overstated. Their representation at all levels of decision-making not only ensures a more equitable workplace but also reflects the diverse clientele that these institutions serve. In doing so, we create financial products and services that are more inclusive, catering to a broader spectrum of needs and preferences. 

Within the word alliance, we want to support financial centers to become leading examples in terms of gender diversity. And by connecting and partnering globally, we can speed up our efforts to build an inclusive and more sustainable future. Gender diversity is a critical factor in making this inclusive growth happen. This is why we signed the gender pledge last October in New York, which reflects the aspirations of our members, focusing on increasing the presence of women at all levels in our ecosystems. And we plan to support this with a yearly action plan, among other steps, to keep moving forward.

This compendium is a commitment to a list of good practices; it is a call to action for all members of the financial ecosystem to actively participate in fostering an environment where women can develop through targeted initiatives such as equal representation on boards & committees, equal composition of conferences and panels, and a mentoring guideline. We aim to break the barriers historically hindering women’s progress in the financial sector.

Therefore, the path to a more inclusive and sustainable financial sector is clear. By acknowledging female leadership and fostering gender diversity, we can unlock a wealth of benefits that will propel our industry forward. The time for action is now, and together, through our collective efforts and commitment, we can create financial ecosystems that are not only more equitable but also more innovative, resilient, and prosperous for all.

Here are some examples of good practices highlighted in the report:

WAIFC members are committed to fostering gender balance through specific actions and encouraging others to do the same. They launched a Women in Finance project in April 2023, aiming to build a diverse, gender-equitable finance industry, attract female talent, and address issues like senior management representation and pay gaps. On October 18, 2023, WAIFC members signed a Gender Pledge.

Efforts to improve gender diversity include enhancing representation on boards, with policies such as the EU’s requirement for 40% female representation on non-executive boards and the Hong Kong Stock Exchange’s mandate for at least one woman on each board by the end of 2024. Family-friendly practices, like those in Kenya, Malta, and Casablanca, support women’s retention and re-entry into the workforce. Addressing the gender pay gap, Luxembourg and Germany have implemented measures to ensure equal pay for equal work.

The Panel Pledge, launched in 2012, aims to improve women’s representation in public and professional forums by ensuring no ‘male-only’ panels at events. Despite the availability of qualified women, many high-profile conferences, events, task forces, and media outlets still lack gender balance. This imbalance affects women’s leadership opportunities, gender equality, organizations, and the broader community. Adhering to the Panel Pledge means committing to gender diversity and rejecting participation in all-male panels.

Supporting family-friendly working practices across International Financial Centers (IFCs) helps attract and retain women in the industry and encourages their return after starting a family. Examples include Kenya’s Employment Act (2007), which mandates breastfeeding rooms and designated nursing areas; Malta’s free childcare services, Klabb 3-16 afterschool program, and Breakfast Club; the Casablanca Finance City Authority’s HR policies for young mothers, including flexible hours and work-from-home options; and the Busan International Finance Center’s provision of three daycare centers for employees’ children.

Eliminating the gender pay gap is essential for worker’s rights, yet it persists globally, especially in financial services. Luxembourg has made significant strides in addressing this issue, serving as an example for other International Financial Centers (IFCs). Legislative measures, such as Germany’s General Act on Equal Treatment (AGG) and the Transparency in Wage Structures Act, help identify and eliminate salary disparities. Since 2017, German women can compare their salaries to men’s in similar roles, promoting transparent and performance-related pay. Malta’s Equal Pay Tool assists organizations in ensuring equal pay for equal work, evaluating the relationship between job value and pay to identify gender-based discrepancies.

To attract more girls into finance, IFCs are supporting educational programs that raise awareness of career opportunities and provide mentoring. Inspiring Girls Hong Kong offers financial literacy training and career support to 1,500 girls aged 16 to 18 from low-income and minority backgrounds in 10 public schools. The DIFC Academy collaborates with leading academic institutions to develop a large talent pool in the region, and the LLM International Business Law program, in association with Paris II Pantheon Assas University, allocates all its sponsored places to women. These initiatives aim to create a strong pipeline of women entering the financial services industry.

Profiling senior women in finance is crucial for increasing participation from minority groups and changing perceptions within the financial and professional services ecosystem. Jersey Finance’s Women in Leadership podcast series features many inspirational women. In Rwanda, six out of 15 local banks are led by women, and women hold over 30% of board of directors positions and 80% of governing executive council positions for the Rwanda Bankers’ Association. TheCityUK’s Next Generation Leadership Council provides profiling opportunities and mentoring for emerging women leaders. The Dubai International Financial Centre’s AccelerateHer program offers mentorship to young aspiring executives, equipping them with the tools and experience to shape the financial landscape. In Korea, KB Financial Group’s WE STAR Mentoring Program nurtures female talent and develops career paths for women executives, emphasizing the importance of role models.

The Abu Dhabi Global Market (ADGM) Gender Equality Initiative is a comprehensive commitment to sustainability, equality, and empowerment. ADGM has progressed on many fronts to further enhance and promote equality throughout the organization, such as salary reviews to ensure equal pay, hiring process, unconscious bias training, succession planning, parental leave, and flexible working. ADGM is also a committed signatory of the Women In Finance Pledge (WAIFC) and Charter For Gender Finance In Financial Centers from (FC4S UNDP), fostering gender equality across the financial center and its partners and ecosystem, including an adequate level of representation of women in the management and gender considerations into all aspects such as decision making, operations, management, and communications.

International Financial Centers (IFCs) are collecting data to monitor and report progress on gender issues, promoting their credentials and encouraging more women into the industry. Celebrating success highlights positive progress and encourages improvement. For example, the Luxembourg Sustainable Finance Initiative’s March 2024 Baseline Report outlines women’s representation and targets for gender diversity. The Development Bank of Rwanda includes gender equality in key performance indicators, while KB Financial Group’s WE STAR program aims for significant female representation in leadership by 2025. TheCityUK commits to gender balance and diversity in their committee terms, monitoring progress biannually.

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