Looking for diversity in finance

The most trending TikTok song of the summer by Megan Boni which innocuously has a single line, ‘Looking for a man in finance, 6’5, trust fund, blue eyes…’ has garnered over 45 million views and inspired other shorts with the same lyrics showing snapshots on the streets of London, Stockholm, and New York City. These shorts feature stereotypical ‘finance bros’ who appear male, white, middle class and above, impeccably suited and booted and piercing blue eyes.

Many have commented on these obvious markers of privilege and were enraged that the lack of diversity does not reflect the diverse customers in the wider financial services markets. Statistics from 2023 suggest a global average of only 18% of C-suite roles held by women in finance. There is also a lack of ethnic minority representation at senior levels, with over 100 FTSE 250 companies having no ethnic minorities on their boards.

I recently interviewed at a firm and throughout the five rounds, every single interviewer was a white male. I had the luck to meet the founder of the business a week later at a child’s birthday party and mentioned the lack of diversity (not knowing his position and opportune to be able to give him an unfiltered appraisal). He countered that his firm was one of the most diverse places to work. However, in the random scheduling of interviewers, I certainly did not see that diversity reflected.

I shared  that I had previously picked a bank over another one because at one of the interview rounds, the Financial Controller was a woman who spoke of her work-life balance and that she was able to pick up her son from school every day. That immediately gave me an insight about their culture living the Diversity, Equity and Inclusion values and I found that culture consistent throughout my time at the firm. The co-founder pondered and asked if strategically, I would recommend that diverse interviewers were picked when facing diverse candidates. I said that diverse interviewers help everyone, whether they are diverse or not because diversity enables us to see our blind spots and we can therefore come to more balanced and holistic decisions, having considered diverse perspectives and life experiences. I passionately believe that diversity helps everyone – it attracts diverse talent, retains diverse talent, and enables the firm to have a competitive advantage when they are known for how they do things as much as what they do.

The main drivers for diversity have been the business case (the McKinsey studies that prove that diverse executive teams increase the likelihood of financial outperformance);  the moral case (it is the right thing to do so everyone can have the same opportunities and fulfil their potential) and the legal case (that is is unlawful to discriminate on the grounds of protected characteristics).

There is another case for diversity that is imperative- the regulatory case for better conduct. Regulators assert that when you have a non-diverse group, there is more likelihood for ‘group-think’. Sharon Donnery, the Deputy Governor of the Central Bank of Ireland said that group think leads to “insufficient challenge and poorly assessed risks.” The 2008 financial crisis was in part blamed for senior leadership supported by ‘yes people’ who let their poor decision making go unchallenged. With the increasing regulatory focus on consumer duty, diversity is a way to ensure fairer outcomes for the diverse group of consumers and clients that financial services serve.

My personal case for diversity is that diverse people have resilience – they have had to run so much further to come to the same starting point as non-diverse people and that drive and passion will be exhibited in how they conduct themselves and their relentlessness in the outcomes they deliver. There is a dangerous presumption that diverse people may have earned their place due to positive discrimination. I saw this presumption squashed by a diverse leader who stated that to reach leadership position, there is always a business case and each person (whether diverse or not) must earn their place. His super power was perseverance.

I also note that diverse individuals we see at privileged levels may come from unseen privileges, mainly socio-economic that enabled them to climb those rungs faster such as a private education. Its important to recognise that unseen diversity (such as neurodiversity, social mobility, sexual orientation, or a hidden disability) may be present even if on prima facie, someone appears to look like the status quo. Just because someone is diverse, they do not (and might not) want to represent diverse opinions and just because someone appears non-diverse, they could still be invisible diversity or be a strong ally.

Many diverse leaders are cognisant of their privileges and barriers and I see them lift others in a purposeful leadership style. They truly demonstrate that representation matters by bringing diverse view points that reflect the weird and wonderful human experience.

Therefore in financial services, the Regulators lead by example. A look at the Bank of England’s Court of Directors from a hundred years ago and today reflects that diversity. On the Court, there is a woman of colour, a Parsi (of Zoroastrian faith) and a banker of Indian origin. The Financial Conduct Authority is led by Nikhil Rathi of Indian heritage and a father of three.

Finally, I urged the cofounder to look for diversity at all levels and not just at the top. I feel that the  financial services industry have the opportunity to address systemic racism, prejudice, and unconscious bias, and make a tremendous impact on society with the nature, scale, reach and complexity of work they do.

The song of the summer was originally meant to be a parody. Lets use it as a call to action to be relentless in seeking diversity in thought, action and impact in finance and beyond.