FINSIA releases gender diversity reporting metrics for the Finance sector

The Financial Services Institute of Australia (FINSIA) has released draft principles against which companies can report on and measure gender diversity. The new metrics will address the lack of meaningful publicly reported data on gender composition and the gender gap within the financial services sector, particularly at senior executive level. They will also address the current difficulty of comparing reported metrics across firms. The draft principles cover companies reporting in detail on the proportion of senior executive positions held by women, as well as reporting on their recruitment practices, career progression and development practices, pay equity, flexible work arrangements and parental leave, and on their ability to demonstrate a workplace culture supportive of gender diversity.

Importantly these metrics will enable FINSIA to track the rate of progress on gender diversity in the sector year-on-year, which, in turn, will enable organisations to measure their performance against industry benchmarks. Check out the full report and metrics or see our summary below:

Principle 1 – Companies should report on the proportion of senior executive Positions held by women at the following levels:

  • % of women on main board
  • % of women on subsidiary boards
  • % of women at CEO level
  • % of women at CEO-1 level (% women in line roles)
  • % of women at CEO-2 level (% women in line roles)
  • % of women at CEO-3 level (% women in line roles)

Principle 2 – Companies should report on their recruitment practices:

Disclosure regarding the number of women involved in the recruitment process would provide a clear indication of those companies who have a genuine desire to address the gender divide at senior executive level. For example disclosure with regard to the following:

  • % women on interview panels
  • % women applicants for all positions
  • % women applicants considered for CEO to CEO-2 positions
  • % women applicants included in shortlist
  • % women graduates entering workplace

Principle 3 – Companies should report on their career progression and development practices:

Greater transparency and commitment around career progression and development would reveal any bias at senior executive level toward men.

Reporting on the budget allocation for professional development for men and women as well as the uptake of professional development programs for both sexes, would prevent any preferential treatment towards men.

Tracking and reporting the average number of years between promotions for both males and females would also highlight any bias.

Principle 4 – Companies should report on pay equity:

Reporting on the percentage of total remuneration package increases (including bonuses) year-to-year between male and female employees would reveal pay inequity at all levels.

Given that the rate of promotions (and their value) and career trajectory is difficult to compare, total remuneration increases can be used as a proxy, capturing both promotions as well as performance measurements in current roles.

The disclosure of the average salary range and bonus data for each staff and function level from graduate level through to CEO level would assist in addressing the pay gap.

Principle 5 – Companies should report on flexible work arrangements and parental leave:

While many organisations claim to have flexible work arrangements, employees at senior executive level are often faced with greater time restraints such that the demands of their role prevents them from accessing the flexible work practices on offer. Through reporting the uptake of these policies (for example: parental leave) and return-to-work statistics, we can begin to see whether this has had a notable impact on career trajectories and career prospects (ie: fewer opportunities and less pay). This could be measured through reporting on the average percentage remuneration package increase after taking leave as compared to before taking leave.

Reporting on the following would set apart those companies who have simply adopted policies to tick boxes rather than with accessibility in mind:

  • % staff on flexible work arrangements (male v female)
  • % staff on flexible work arrangements (male v female) at CEO to CEO-2 level
  • % staff who have returned and (remained) in permanent employment more than one year after taking parental leave
  • % of staff promoted before, during or after taking maternity/paternity leave

Principle 6 – Companies should report on ability to demonstrate a workplace culture supportive of gender diversity:

Perhaps the greatest prejudices women encounter throughout their career cycle (and the hardest to address), are the residual cultural beliefs and behaviours in the workplace. Equally, it is difficult to measure real change in organisational culture, yet it undoubtedly has a huge impact on the success of any initiatives in making genuine change.

An annual staff perception survey on gender diversity and the effectiveness of initiatives could provide insight into the level of progress on this. For example: the percentage improvement in cultural measures supporting achievement of gender diversity goals or the percentage improvement in the alignment of the ‘gap’ perspectives of men and women.