Championing diversity in FinTech
October 2019 | FEATURE | BANKING & FINANCE
Financier Worldwide Magazine
October 2019 Issue
A lack of diversity is a stick used to beat many organisations across many sectors, and financial technology (FinTech) is no exception.
Indeed, at a time when the sector is clamouring to fill the roles that growth is generating, FinTech is recognised as having a diversity problem, with few women working in FinTech companies and fewer still female founders and leaders.
“Gender diversity statistics in FinTech are not as progressive as we would necessarily expect or want them to be,” says Clare Black, head of communications and diversity at Innovate Finance. “The wave of founders that has come out of banking has been predominantly male. So, unsurprisingly, 83 percent of all FinTech executives are male. Women represent just under a third of total staff in the FinTech sector.”
As a result of this underrepresentation, female FinTech entrepreneurs often struggle to raise venture capital (VC). “Without investment they cannot launch their own businesses,” asserts Liza Russell, chief executive of iNBOTIQA. “Women are also sidelined for senior roles and are often not given the same opportunities as men to become leaders of existing FinTech firms. Whether it is conscious or not, there is still a tremendous amount of gender bias in the hiring process.
“When you look at the talent pool, there are only a few women climbing the ranks in the old and new world of financial services,” she continues. “Many come through at entry level. But when it comes to career advancement, they can be held back as a result of inflexible work practices that make it difficult to combine family and career. A work culture that does not nurture and mentor females also prevents them from breaking through the glass ceiling.”
To address the lack of women in the FinTech space, inspiration and guidance is key, with female role models and appropriate support programmes among the strategies available.
“We need a two-pronged approach focused on attracting new female entrants into the sector and progressing the talent we already have,” believes Pierre Velinor, head of engagement at Brickendon Consulting. “The key is to bring the excitement of FinTech into the education system earlier, showing young females the benefits of working in such an innovative, forward-looking sector. We also need to encourage schemes such as returnships – designated programmes and support systems aimed at helping those returning to higher-level, higher-paid positions after an extended carer break.”
In the view of Evgeny Shadchnev, co-founder and chief executive of Makers, it is important for the FinTech community to highlight its female success stories. “We must shine a light to inspire women,” he suggests. “Also key is to ensure there are role models and support networks, so that they are assisted along their career journeys.”
The importance of such networks, such as mentoring schemes, is also not lost on Ms Russell. “Mentors provide practical help and a support network to encourage other women to found companies,” she adds. “They also help to change the overall mindset of the FinTech world, simply by being present and becoming ‘the norm’.”
In short, the virtues of diversity are tangible and direct. “It is widely acknowledged that diverse groups are stronger, more creative and more innovative,” says Mr Velinor. “This makes organisations more competitive and enhances their ability to exploit growth opportunities and generate revenue and profit. Moreover, diversity provides access to a larger talent pool and better decision making, by bringing together different perspectives and a range of experiences.”
Overall, there is some way to go before the FinTech sector is truly diverse. However, changing the perception of FinTech as a male environment and, in turn, the reality, will help the sector to foster an environment where diversity is at the heart of every company.
“The sector’s diversity problem is a deep-seated issue and cannot be solved overnight,” suggests Ms Black. “There has been a noticeable shift in attitudes in the wider financial services industry, as awareness of the diversity problem spreads. It is now well understood that a diverse workforce unlocks great benefits, including increased profitability and creativity. It is time that the FinTech sector goes beyond just voicing what change needs to be made and ensures that it actually happens.”
According to some commentators, the sector has noticeably moved toward promoting itself as a mixed and cohesive environment. “Although the timing for substantial change is difficult to pinpoint, the sector is starting to do the right things,” notes Mr Velinor. “Once there are more women in key positions, this will hopefully drive and encourage more to get involved and take an interest.”
That said, in the view of Mr Shadchnev, no substantial change in sector dynamics is likely until legislation forces FinTech businesses to close the gender gap, as well as encouraging better flexible working and mentorship. “We need investment in female-led businesses to ensure a steady pipeline of talent to meet the demand of the digital economy,” he concludes. “Empower women and they can lead businesses or build and create their own FinTech firms.”
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