A new government charter, created to implement the recommendations of the independent review led by Virgin Money CEO Jayne-Anne Gadhia, will link City bonuses to the appointment of senior women to improve gender diversity in the financial service sector.
The Gadhia Review recommends that financial service firms connect parts of the remuneration packages of their executive teams to gender balance targets. It also recommends that firms set internal targets for gender diverstity in their senior management, publish progress reports annually against these targets, and appoint an executive solely responsible for gender, diversity and inclusion.
“Achieving gender balance at all levels across financial services firms is a personal priority of mine, which is why I asked Jayne-Anne to carry out this incredibly important review into women in finance in the Productivity Plan,” Harriet Baldwin, Economic Secretary to the Treasury, said. “Financial services can lead the way as the sector with the highest pay in the UK and the widest gender pay gap. The widespread adoption of the review’s recommendations will help make a genuine different to gender diversity in financial services. This is just one part of the government’s broader ambition to tackle gender inequality in the workplace.”
The new Women in Finance Charter launches today committed to take on board these recommendations, which the government believes to be key in driver change in the senior levels of the male-dominated financial services industry.
“The objective of the review was to understand what more could be done to get more women into senior leadership positions. To achieve this, we had an open, transparent and democratic debate, and involved as many firms and individuals as possible to hear all the relevant voices and win broad and widespread support,” Jayne-Anne said.
She will be the first bank chief to sign the Charter on behalf of Virgin Money. Alongside her, representative of four of the sector’s largest emploers, Lloyds Banking Group, Barclays, HSBC and the Royal Bank of Scotland, will also pledge their commitment to improve gender diversity in their firms. Columbia Threadneedle and Capital Credit Unior will also sign the Charter today, and the Treasury will publish a list of the firms who have signed up after three months.
“Our research showed that in 2015, women made up only 14% of Executive Committees in the financial services sector. Too few women get to the top and this is not just about childcare. Women are leaving because the culture isn’t right,” Jayne-Anne added.
“It’s very encouraging that a number of major financial services companies have already agreed to implement our recommendations. As a result, the issue will now be addressed in a way the City recognises. Make it public, measure it and report on it. What gets published gets done.”
Richard Branson also voiced his support for Jayne-Anne and her report, highlighting the importance of balance and equality in the workplace.