Diversity and inclusion are hugely important for all employment sectors – but in few industries as much as in fintech. Leaders in the fintech world need to be agile and innovative, meeting increasingly complicated regulatory conditions, cybercrime threats and steep competition.
Therefore, digital evolution, diverse hiring policies, and attracting fresh talent aren’t PR exercises but vital to ongoing success. This guide explores how leading finance provider Wonga is leading the diversity charge – and the compelling benefits it brings to their business.
The Fintech Equality Challenge
Traditional financial companies, such as banks and insurers, top the scales of the least diverse organisations globally. Extreme gender pay gaps and very little female representation in any senior roles are the norm.
For example, Monzo (incidentally, one of the most diverse British banks) still has a 33% gender pay gap based on mean pay and a 40% inequality based on median bonuses. Likewise, boards tend to showcase a male-dominated culture, which severely limits strategic thinking.
Here’s why diversity carries big consequences – and rewards – in this sector:
- Consumers have greater awareness than ever of the vision, values and qualities of the companies they choose to do business with.
- Groupthink attitudes to policy-making leave firms entrenched in outdated ways of doing things, without the initiative or enthusiasm to consider radical change.
- Diverse representation is a benchmark of good corporate governance and impacts multiple standards, industry accreditations and inspection outcomes.
- Multi-faceted management teams drive customer satisfaction, accelerate innovation and have the capacity to out-perform rival businesses.
Understanding the customer is at the heart of any consumer-facing industry, and so the opportunity to drive towards better diversity and more inclusive workforces is a clear competitive advantage.
While the business case for diversity is unquestionable, the real puzzle is how to make it a reality.
Creating a Culture of Change in Fintech
So, how have financiers such as Wonga bucked the trend, and what lessons can other financial organisations learn?
Next, we’ll run through a few crucial steps to introducing true diversity across the spectrum of a fintech business structure.
Leading From the Front
Without clear leadership, any new programme is destined for failure. Introducing a new policy or regulation at the ground level is great, but it won’t become an ingrained part of the organisational culture without the right support.
Key figures such as the CEO must advocate for diversity and make visible public commitments to improving inclusion for any actions taken to be effective. Senior management sets the tone, and the trickle-down effect means they need to take the initiative before asking more junior colleagues to buy-in.
Evaluating Current Diversity Issues
Many fintech firms find the question of diversity sticky, so do their utmost to turn a blind eye.
This head in the sand stance won’t build any bridges, so it’s essential to allocate resources to analyse current employee figures, identify where there are glaring gaps, and then set targets to improve.
So many businesses make token gestures intended to express their attitude towards inclusion, but an educated customer base will instantly see through transparent publicity exercises.
Relevant information includes employee genders against their seniority, how long staff tend to be in a position before being promoted, and the hiring statistics by ethnicity, gender, and other metrics captured at the employment stage.
Setting a quantifiable target without analysing actual data is impossible, so this assessment process is pivotal. Ideally, it should be linked to management target-based pay to make it a central focus for hiring teams.
Reforming Recruitment Bias
The next step is to put proactive measures in place to hit those targets, and it all starts with recruitment.
Another common reason for a uniformly white or male workforce is that the company simply doesn’t receive applications from any other candidates – which begs the question of why?
Bias is often unintentional yet inherent in the language used in advertising. Revisiting and reforming everything from the tone of job vacancy ads to the agencies used to put forward candidates can alter the pool of applicants for every role.
Implement Fresh Training Protocols
Diversity training can be controversial, and yes, it might initiate uncomfortable conversations or force managers to confront institutionalised bias that they’ve carried for many years.
However, awareness is fundamental to true change, and whenever there is a tendency to stereotype or make decisions based on unconscious bias, training is an appropriate solution.
Coaching can help management identify areas for personal growth, contribute to their continued professional development, and open up the discussion about why deliberate effort is necessary to effect real diversity.
Embrace the Benefits of Flexibility
One of the fundamental requirements for women to consider applying for a fintech role is flexibility.
That’s not limited to female applicants but includes millions of qualified candidates who need to cater to family responsibilities, care for loved ones, and maintain a healthy work/life balance.
Flexible working is big news, but take-up in the financial space is low, often due to a simple misunderstanding of what flexibility implies, and the impacts on other team members.
The stigma around flexible working means that many hirers assume they’re targeting working mothers or won’t see the same productivity from a parent.
However, the evidence is overwhelmingly to the contrary and suggests that agile businesses have a tremendous advantage in employee satisfaction, effectiveness and commitment to overall business objectives.
As we’ve seen, financial services providers in the fintech sector have an uphill journey if they want to evolve into contemporary, modern businesses that attract the finest talent and skill.
If they follow the progression pathways of those already breaking the glass ceiling, they’ll see why the effort is absolutely worth it.
Short-term priorities such as reducing costs, producing shareholder results and meeting regulatory requirements tend to take precedence. Still, this view is limiting and won’t get anywhere exciting very fast.
Diversity in business isn’t a social issue but a business pursuit and one that can transform the potential for success of any fintech company.