For many years, Investment Banking has been an industry run by men, for men. With changes in the world economy, the number of women becoming involved is rising. Even so, women fill less than 17% of leadership positions in investment banking.
Driving Technology in Investment Banking
Candace Browning, who is the Head of Global Research and Head of Financial Technology Investments for Global Banking and Markets at Bank of America Merrill Lynch is an expert at deploying high-tech solutions to make smart moves for her division. As a result of her push to move her organization into the future of technology, the global research division has been using predictive analytics to publish highly regarded reports at an astonishing rate. Of the push toward sophisticated technology Browning says, “Change is something we often fear, but if we focus optimistically on the opportunity instead of getting distracted by all the uncertainties, we can excel.”
With the number of women investors rising, financial institutions are turning to artificial intelligence and machine learning to better serve these customers. Women have been underserved in this industry in the past.
By using sophisticated technology, banks are looking to change this by analyzing behavior and examining the key differences between male and female investors. Now more than ever, women are driving the technology that is being used to serve the target market and make decisions about investment product offerings.
Pushing for Better Legislation
Rebecca Patterson, Chief Investment Officer, Bessemer Trust, is not interested in sitting on the sidelines and instead is influencing U.S. politics and policy with regards to the economy. By putting an emphasis on policies that would provide a greater focus on education, retirement savings, and home ownership, she hopes to improve the lives of middle-class Americans.
“I know policy may not change simply because I made suggestions, but I feel compelled to at least provide objective food for thought and get actively involved in the process to the degree my schedule allows,” says Patterson of her efforts.
Giving her daughters a voice is also a huge priority. She brings them, ages 10 and 13, to demonstrations so that they can better understand the democratic process.
Seeking to Retain More Women
Abigail Johnson is the Chairman and CEO of Fidelity Investments. With women controlling a growing portion of wealth in the United States, she considers hiring women into the investment sector not just an opportunity for equality, but a necessity.
However, some women find the fact that most investing clients to be male to be problematic. One investment banker at a large U.S. firm feels that “things won’t change” if the customer base isn’t demanding it.
In a recent survey, it was found that women reported observing bias against females on Wall Street twice as often as men, but about the same number of men as women observed women getting promoted more slowly. Men and women were clearly divided on the issue of equal pay, however. Of employees of different genders working at the same level, only 40% of women felt that pay was equal, compared to 75% of men.
Women in leadership point out that investment banking is challenging and that men are struggling as well. Lorraine Connell, Managing Director of UK investment banking at Barclays, encourages women to see themselves as part of one team from the beginning. Tara Courtney Davies of Macquarie Capital agrees. “Men and women face very similar challenges; all employees have to evolve and make a successful transition from an analyst to being able to sell and generate money. It’s the same for men and women in that respect,” says Davies.
Calling for Culture Changes
All challenges aside, women are at the forefront of identifying culture changes that are necessary to promote more diversity in investment banking. Challenging the status quo may be the only way to pave the way for women looking to obtain leadership positions in investment banking in the future.
Currently in the financial industry as a whole, women early in their careers are 24% less likely to obtain a promotion than men in the same time period. Hazel Moore, Chairman of FirstCapital recently spoke on the lack of women applying for senior positions in investment banking:
Calls like this to examine the very culture of an industry will be critical in promoting future diversity and opportunities for women to gain higher positions in investment banking. As cultures change and more women stick around, they will turn to newer generations as role models and mentors to provide the sponsorship that is lacking for women in the industry today. These women often feel that they don’t have enough in common with the male leaders in their organizations to seek mentorship from them.
It wouldn’t be a surprise if these changes being brought forth by women in investment banking gave way to a more female-dominated industry within the next 20 years. This has already been seen in other career fields and will continue to expand.