Setting the Stage for Gender Equality in Canadian Banking and Financial Services

Canada has witnessed some exciting gender equality wins over the last few years, both symbolic and concrete. Senate passed a bill to make the national anthem gender neutral1. The government rolled out an expanded parental leave policy, helping to alleviate the burden on new mothers2. The City of Montréal hosted the first-ever meeting of female foreign ministers3.

But as the COVID-19 virus makes its mark worldwide, it threatens to undo the progress made in Canada and abroad. And as we face a recession predicted to shrink Canada’s GDP by 6.2%, women will bear the brunt of the downturn since they make up the bulk of the sectors most affected – restaurants, travel and hospitality4. On top of being at higher risk for losing their jobs, they’re also most likely to be working alongside the virus each day, as women make up 75% of health practitioners5.

Pandemic aside, here in Canada’s financial services industry, we’ve had work to do all along. Within our six largest banks, women make up 58% of the total workforce, but only 38% of senior management positions6.

While one industry may not determine the policy direction the government takes to promote gender equality, Canadian banking and financial services leaders do have the power to promote change in our own organizations and the industry at large, even in the midst of the COVID-19 pandemic. So where to begin?
 

Taking Action

Attaining a truly inclusive environment and culture of equality requires an “all hands on deck” approach and mindset from employees at all levels of an organization. While everyone has a responsibility to uphold gender equality efforts, senior leadership holds particular responsibility to make change in an organization. If those at the top of the pyramid are not on board and willing to implement programs, set targets or engage other leaders, those below will lack motivation and hope for change.

To see real, measurable change in their organizations, those leaders must take action on several key initiatives. As we push through the COVID-19 pandemic, we are offered a rare opportunity to put these measures to work.

• Pay – Negating the gender pay gap is perhaps the most obvious step to promoting gender equality, and no one can deny its importance. In Canada, women earn $0.87 for every dollar that men earn, or $4.13 less than men per hour7, showing that we still have work to do. And with an impending global recession thanks to the pandemic, women are predicted to be hit harder than men since they make up a greater percentage of the workforce in service-related jobs such as those in the hospitality sector8. As a result, we may see slower progress over the next few years in creating equal pay. Within the financial services industry and as a sector that will be spared the worst of this economic downturn, we have a duty to focus on taking down the pay gap wherever possible.

• Hiring and Promotions – Diverse organizations – especially those with a diverse leadership suite – outperform homogenous ones. In times of crisis, as we find ourselves now, when a leadership suite brings greater perspectives due to a variety of identities, organizations are stronger for it. To set your organization on the right track to building a strong pool of female employees and employees of colour ripe for leadership positions, consider implementing a mentorship program. While female leaders can serve as helpful mentors to other women looking to climb the ranks, pairing male leaders with female associates is just as important so that leadership across the board may be able to look beyond their own unconscious biases to see the organization’s leader talent pool for what it is.

• Parental Leave and Childcare – Over the decades, women may have been set back in the workplace due to outright discrimination in some cases, but societal parenting roles play a huge part in gender imbalance. Sixty percent of women say it’s a challenge to balance work and family compared to 52% of men – indicating that women lose time focusing on their work because societal parental roles obligate them to shoulder more of the childrearing9. Favourable parental leave for both men and women, with comparable lengths of time and benefits, is an important step in overcoming this barrier. Providing employees with affordable childcare options, such as an on-site daycare centre or a pre-tax childcare spending account, also helps alleviate the burden on both mothers and fathers in your organization and lets them focus on their careers.

• Work Flexibility – As women still carry the larger burden of childcare, flexible work arrangements, such as the ability to work from home or to work flexible hours, are particularly important for retaining and promoting female employees. According to a study from the University of British Columbia, “When companies allow work to be organized in a flexible way, they're less worried about hiring mothers… Not only does flexibility make it easier for mothers to do well in their jobs, but it also alleviates concern from the employer that they'll be able to10.” The broader importance of flexibility, not just for parents, but for all employees, is clearly important for working through times of crisis, such as now. Employers who already enabled flexible arrangements experienced less disruption transitioning to the new normal of quarantining. The setup especially supports parents suddenly burdened with full-time childcare on top of their jobs. Organizations that have robust flexible work programs should realize the benefits during this pandemic crisis, where working from home has been a critical component to quickly mobilize a response for business activities.

• Diversity Training – To make sure all employees in the organization receive the message of how gender equality is treated within the organization, the importance of diversity should be part of the employee training process for all employees. Just as you require employees to participate in quarterly or annual cybersecurity training, diversity training should recur in their required training queue to keep the issue fresh on employees’ minds.

• D&I – More than just giving women a seat at the leadership table within the financial services and banking space, we need to create a welcoming, diverse environment. Establishing a diversity and inclusion (D&I) committee and other similar interest group committees reinforces the idea of inclusivity for not only women, but also people of colour, LGBTQ professionals and other underrepresented groups, and provides important spaces and resources for these professionals. Seventy percent of Canadian organizations say they focus on improving D&I, versus 81% of organizations globally11.

• Tracking Metrics – Quantitative tracking of furthered gender equality means so much more than anecdotal evidence of progress. Every organization’s HR team should track demographics to help the company understand its D&I progress. Sixty-five percent of Canadian organizations do so already, compared to 64% of organizations globally12. Ideally this number will be 100% in the near future. This should go beyond just tracking the number of women within the organization in leadership roles. It should also look at aspects like tenure, pay, and sense of belonging via employee engagement surveys. Diving deeper into such numbers can provide helpful direction into where problems may lie.

Seeing progress firsthand

As the leader of the Canadian division of Northern Trust with more than 25 years’ experience in the industry, I’ve witnessed the gender balance come a long way. Do I still occasionally find myself as one of few women in the room, and sometimes the only woman in the room? At times, yes.  

However, while we all still have work to do, especially amid the COVID-19 pandemic, I’m very proud of the strides I’ve witnessed at Northern Trust over the course of my career. With a robust D&I program, an impressive gender ratio of leaders, and built-in training surrounding diversity and gender equality, we’ve been recognized by programs like the Bloomberg Gender Equality Index for our progress. At the same time, we, like so many others in our industry, recognize we can’t claim victory yet in our efforts to reach true gender equality.

I am confident that we and our industry peers will continue to rise to the occasion of promoting gender equality and in particular, leveraging lessons from this current crisis. The COVID-19 pandemic should serve as a catalyst for change. It has revealed the world’s economic inequity with stark contrasts. We must show we care by being committed to fair pay, transparent compensation principles, and diverse and inclusive workplaces.
 

1 CNN, Canada moves to make its national anthem gender-neutral, June 15 2018
2 HuffPost, Canadian Dads Can Take 5 Weeks Of Shared Parental Leave. Here's Why They Should, March 25 2019
3 Foreign Policy, One Small Step for Feminist Foreign Policy, September 20 2018
4 The New York Times, Why This Economic Crisis Differs From the Last One for Women, March 31 2020
5 World Health Organization, Spotlight on Statistics, February 2008
6 Canadian Bankers Association, Representation of Women at Banks in Canada, January 14 2020
7 Statistics Canada, The gender wage gap in Canada: 1998 to 2018, October 7 2019
8 ibid.
9 Pew Research Center,  For many working dads, balancing work and family is a challenge, June 12 2019
10 ScienceDaily, Flexible work arrangements reduce wage gap for mothers, May 10 2018
11 Mercer, Let’s Get Real About Equality, 2020
12 ibid.