In recent years, we’ve witnessed heightened attention to gender-related issues in hiring, with movements across almost every industry to make the workplace a fair and equal environment for all individuals. The finance industry is no different: women, joined by their male colleagues, are advocating to close the gender gap and bring diversity to the finance function.
According to the World Economic Forum’s 2017 Global Gender Gap Report, “female talent remains one of the most underutilized business resources.” It may take another 217 years to close the economic gender gap globally if we remain at the current pace. Nearly a century since International Women’s Day was first observed, some of the top companies are still paying women half as much as men. A major contributing factor to this disparity is a much higher contingent of men than women in senior roles. In some industries, like finance, this is especially clear.
General Motors recently announced its new CFO is female; with women in both the CFO and CEO chairs, GM occupies a rare place in business. Only 23 companies in the Fortune 500 have a female CEO, and Hershey is the only other company on that list that has women in both CEO and CFO slots. Perhaps if more women rise to senior roles, we’ll start to see less pay disparity.
The role of finance is already in a period of dense transformation. CFOs are evolving from traditional number-crunching to strategic partners to their CEOs and boards, while also adopting advanced technologies as part of the increasingly intelligent enterprise. It’s important to take advantage of this transformative time and ensure that, while we’re focused on upskilling the profession, we bring women along for the ride.
Inspiring young women through education
Gender diversity is good for the bottom line. Credit Suisse found that companies where women make up at least 15% of the senior managers have more than 50% higher profitability than those where female representation in senior management is less than 10%. So how do we entice more women to enter the profession and eventually penetrate the upper echelon of finance? It all starts with education.
The Pew Research Center found that academic achievement of U.S. students still lags their peers in many other counties. This is especially true in math, where the United States ranks 38th out of 71 countries. It’s critical that youth have a solid understanding of math, as well as the financial literacy to promote responsibility for their own wealth. Without a strong foundation to build upon, the battle to encourage young women to pursue careers in finance is lost before it’s begun. The earlier we can help students feel proficient in finance, the wider their career opportunities will be down the road. In fact, my own high school accounting class ignited my passion for finance and set me on the path to become a CFO.
Cultivating an unbiased corporate culture
Peer-reviewed evidence indicates that even when women have the correct academic and technology skills, unconscious biases can influence their peers’ recognition of their capabilities. While gender bias is most often envisioned as scenarios where women are assumed to be weak, emotional, or unqualified, there are many forms of unconscious bias. For example, financial job descriptions may use keywords that resonate more with men than with women because they are being written by/for a male audience. This small inflection in tone could be the difference between a woman being excited or uncomfortable about pursuing an open job in finance.
While the world has made progress on the journey to inclusion, there’s more to be done. Unconscious bias and lack of gender diversity hold organizations back. Diversity and inclusion are no longer optional; they are business imperatives. Imagine a world beyond bias, where diverse genders participate fully in an inclusive, modern workforce for the digital era. This is an idea that can become a reality.
Company culture plays an important role in closing the gender gap. The first step starts with a new hire’s impression of any bias in human resource processes. Machine learning technology can help organizations detect and eliminate gender-biased language in job descriptions or remove names and photos of candidates for promotions to prevent bias and open the pathway for women to climb the corporate finance ladder.
Setting expectations through accountability
By combining education with a positive corporate culture that values diversity and inclusion, corporations must hold themselves accountable for carrying out their mission. The United Nations (UN) has created a global initiative of 17 goals to achieve a more sustainable future and has invited companies across the world to join them in this charter. One goal is dedicated to helping reach gender equality for women.
Closing the gender gap and championing women in finance has become policy in many companies, including SAP. In an effort to improve gender diversity, SAP made a commitment to increase the number of women in management from 18% to 25% by the end of 2017. The company surpassed that goal ahead of deadline and has challenged itself by setting an even higher goal by 2022. It is through this larger network of female leaders that we can usher in the next generation of women in finance. After all, a rising tide lifts all boats.
Gender diversity is fundamental to how businesses thrive. Ensuring the full development and appropriate deployment of half of the world’s total talent pool has a major impact on the growth, competitiveness, and readiness of companies across the globe. The time for change is now: early education, eliminating bias, and setting benchmarks to ensure accountability will allow a 50:50 representation of men and women actively working together to move the needle.
This article originally appeared in CPA Practice Advisor and is republished by permission.