CFA Institute’s study ‘Gender Diversity in Investment Management’ shows that like many other professions, men dominate the investment profession as well. In India, only 10.7% of investment management professionals (CFA members) are women. This makes it one of the categories where women are most underrepresented.
At which age do women make their career decisions?
The research says that one possible explanation for the underrepresentation of women in finance is the well documented gender gap in math: boys tend to perform better than girls on standardized math tests. Moreover, the gender gap in math has been linked to cultural norms. Another independent study has provided evidence that the gender gap in math across countries is correlated with measures of gender inequality.
CFA members report that they made the decision to pursue a finance career early in life. More than 80% of CFA members made the decision to pursue a finance career while under the age of 26. More than one-third made the decision before the age of 22. These patterns are similar for men and women.
Lakshmi Iyer, CIO-Debt, Kotak AMC says, “Firstly, investment management is a very niche field and secondly it is a high intensity job which requires significant time commitment. At times, such jobs can have high stress levels. So the combination of these things deters women to get into this profession. Thus, they end up settling with jobs which are less stressful.”
The study also finds that the younger generation is not making career decisions earlier in life; most are still determining their career during their university years or shortly thereafter, and all the influences up until then are the contributing factors.
Tejal Gandhi of Money Matters says, “Women avoid having money conversations and also many men do not like to include their spouse when we conduct meetings. This survey validates the fact that women don’t want to participate in anything that is related to finance and investments. To solve this problem, the education system needs to be revised and emphasis should be given on having financial knowledge.”
Interestingly, women are underrepresented in all of the most common CFA member occupations globally. Women represent only 1 in 10 people in the key leadership positions of CEO, chief investment officer and chief financial officer. The occupations with the highest representation of women are performance analyst, compliance analyst/officer, and relationship manager/account manager but even in these occupations, women represent less than one in three workers.
Swati Kulkarni, EVP and Fund Manager- Equities, UTI Mutual Fund says that women lack support system from their family to pursue their career goals. “Not just in investment management profession but in other professions as well, women are not able to manage their personal and professional lives due to a lack of family support. This number will increase only if women get the freedom to work without any family pressure.”
Here are some of the suggestions offered by CFA Institute to attract and retain women professionals in investment management:
- Pursue university outreach to let women know of investing as a career, although building math and technical skills must begin even earlier.
- Make potential entrants to the field aware of the current flexibility within it.
- Educate firms on the importance of work structure and flexibility in attracting a gender diverse workforce.
