News / Women in investment
Breaking the gender barrier in investment
The gender gap in the UK investment sector stands at £567 billion, according to a recent report by Boring Money – a figure greater than the GDP of Switzerland.
Yet, a research by Fidelity Investments shows that women consistently achieve better investment returns than men, by an average margin of 0.4 per cent.
Bristol24/7 explores why there is such a big gender disparity in investment, why this matters and what can be done about it.
Farida Hassanali, client relationship manager at the Pill-based investment firm Paradigm Norton, emphasises the transformative impact of encouraging women to embrace the role of investors.
“With more pressures outside of work, women are less likely to have the opportunity to spend time networking with their professional peers,” said Farida Hassanali at Paradigm Norton
“With the right education resources, women can use that knowledge to be just as confident as men, and once encouraged, they are significantly more likely to invest. And they are likely to be successful,” says Hassanali.
She says it’s easy to focus on the current gap but it needs to be looked at in the historical context.
“Most people will be shocked to realise that it was only in 1975 that the Sex Discrimination Act was passed, which forced banks to treat men and women equally,” Hassanali continues.
“This is when women were allowed to open their own bank account. However, it has only been since 1990 that women have been taxed as individuals. With this context in mind, we’ve come a long way.”
For Hassanali, one of the first steps towards opening up the investment sector is levelling up pay disparity.
“Addressing pay disparities will provide women with greater excess income and home ownership would give them the security to allocate this to their long-term success,” she tells Bristol24/7.
“One positive is that the proportion of women entering higher education is 57 per cent. However, there are still only 27 per cent of women undertaking STEM degrees, which are often associated with higher paying jobs.”
Looking at the solutions to the barriers faced, Hassanali adds: “Firstly, breaking down those internal biases to improve the level of women working in the sector as advisers rather than just back office staff is important. This includes considering how to avoid defaulting to women taking on the bulk of family and career responsibilities.”
She pointed to the “elephant in the room”, adding: “Women are also more likely to manage the household. This ‘invisible’ planning and decision-making role means even if the physical chores are divided equally, the mental load is still present.
“With more pressures outside of work, women are less likely to have the opportunity to spend time networking with their professional peers.”
The south Bristol-based social enterprise, Women’s Work Lab, has helped 300 mums back to work in order to gain financial independence – photo: Women’s Work Lab
Aditi Singh, vice president of Women in Finance at the University of Bristol, echoed this sentiment, saying: “The gap has definitely reduced significantly from what I’ve seen with my engagement with the industry. Although, the main issue is still the lack of women at the top.
“I think the main solution would be better support for working mothers as I’ve noticed that women get stuck in a corporate associate position after childbirth for many years and don’t get promoted. With better childcare plans, balance can be easier and more women will be in top leadership positions.”
Women’s Work Lab has women’s financial independence as its cornerstone. So far, the south Bristol-based social enterprise has helped 300 mums back to work.
Co-founder Camilla Rigby said: “We see first-hand the negative impact of poor financial literacy amongst women. We support many women who have been in financially coercive and controlling relationships, often escaping the abuse only to be left with poor credit rating and debt.
“Our mums are all aiming to be financially independent and we work with partners to help them understand how to regain control of their finances. It remains a taboo in modern British society but needs to be spoken about more openly.”
The Princess Royal meeting the staff at Triodos Bank – photo: Barbara Evripidou
Roger Hattam, director of retail banking at Triodos Bank UK added: “For many years, research has shown that women are less likely to choose an investment product than men. This is a shame because we also know that women are more likely to want their money to be invested ethically, in organisations working for positive change rather than harmful industries like fossil fuel or arms.”
The change is happening, albeit at a slower pace. By breaking down barriers and challenging stereotypes will no doubt propel the process forward.
Main photo: Aditi Singh
Read next:
Our top newsletters emailed directly to you
