Diversity, equity, and inclusion (DEI) investments are crucial in any organization or industry, but they are especially relevant in all sectors of the finance industry. From a recent Seramount survey of organizations with 500 or more employees, historically excluded talent in financial services is less likely to be promoted, become an executive at a finance company, or be part of the top 20% of earners. From traditional banking to financial technology, the finance industry remains predominantly white and male, but efforts are underway to enhance inclusion and better represent the diversity of their customer base. Although progress in DEI may be gradual, the key is commitment to continuous improvement. Leading organizations continue to find new ways to incorporate DEI initiatives into their business strategies, turning to research and consulting partners like Seramount to make informed decisions advancing their organization’s DEI journey.
Like other major industries, finance has its own unique struggles with DEI. Addressing these unique challenges involves leveraging research, subject matter experts, and reliable best practices. According to Seramount’s research and data taken from Seramount’s annual Inclusion Index, there are a few areas where the finance industry lags other industries. When comparing total women employed across industries, financial services surveyed report only 47.9% while other industries report 49.9%. Seramount’s surveys also showed that only 52.1% of women are promoted in financial services compared to 54.5% across all industries. In 2022, Seramount asked if organizations across industries were on track to meet their proposed representational goals. Only 84.2% of financial services companies said yes, compared to 90.8% of companies across all industries.
Here are 3 ways your finance organization can continue to champion DEI initiatives:
1. Foster Inclusive Talent Pipeline
One best practice that financial organizations should be using to ensure the retention and advancement of women and other historically excluded groups is fostering an inclusive talent pipeline. Simply hiring historically excluded talent is not enough; these individuals need to be supported throughout their entire journey at an organization. This support could include implementing diverse hiring practices, creating sponsorship opportunities for historically excluded talent, or having an inclusive succession plan in place. Creating a diverse talent pipeline and fostering successful outcomes is a great way to keep retention rates high and keep employees happy and engaged in your organization.
Studies have shown that the use of ERGs in organizations is an effective method for maintaining employee engagement and fostering a diverse talent pipeline. These groups provide a safe space for individuals who share commonalities to connect in a workplace setting. ERGs offer volunteer leaders increased visibility and recognition, which can result in promotion within the organization.
Cultivating psychological safety in the workplace is essential for the overall success of your organization. It empowers employees to feel safe to express themselves at work without fear of retribution. It takes work and effort to create a , but the benefits are substantial. Studies show that psychologically safety helps promote creativity, open space for dialogue, and drive productive change within an organization. Many leading financial services organizations use engagement surveys to discover what employees need, but many employees fear that their responses will fail to remain anonymous. Seramount offers a completely anonymous employee listening tool called that enables all participants to be anonymous and answer questions as honestly as they feel.
The finance industry is making incredible strides to increase DEI initiatives across the board and that should be acknowledged. According to Seramount’s research and data, 72.4% of financial services report that they offer formal sponsorship programs, compared to 59% across all industries. Among financial services companies, 96.6% report having an internal diversity council, compared to 88.5% for other industries. Seramount’s DEI Research Partnership offers organizations the necessary support for any DEI topic that might arise. Our advisors and subject matter experts have over 200 years of combined experience and are available to our members on demand.
If you would like to know more about becoming a member or would like more information on our Employee Voice Sessions, contact us.