Is the future of finance female-friendly?
By June MacKinnon 20 November 2019 4 min read
The beginning of my journey
Initially, I had planned to become a chartered accountant. A career in investing wasn’t even remotely on my radar until I had the opportunity to take a finance and investments course from a fantastic professor in university. So, in the first semester of what should have been my final year, I changed my schedule in order to accommodate more finance courses, and in turn complete two undergraduate degrees: one in finance and the other in accounting.
Truth be told, anything related to gender equality didn’t even cross my mind when I made the decision to change my plans and pursue a career in finance. I didn’t even know what kinds of roles existed beyond what was then called a stockbroker. I also didn’t think twice when a Yahoo! search led to my discovery of the Chartered Financial Analyst (CFA) program, the accreditation’s excellent pedigree, and its worldwide recognition. I had no idea how few women charterholders there were, but I knew immediately that one day I would obtain that designation.
I became a CFA Charterholder in October of 2003; at that time just 18% of all charterholders were women. I was frequently asked how many times I had to write each exam and while this question is asked of both genders, it seemed disproportionately asked of females. I was also asked numerous times why I wanted to pursue the designation and often reminded of how challenging the exams were. I don’t recall my male peers being asked why they wanted to become charterholders! Somehow it was deemed appropriate for men to pursue, but puzzling that a woman would want to do the same. More than 15 years later, the world of finance remains heavily male dominated, with just 19% of all charterholders being female. That said, there has been a noticeable increase in women pursuing the CFA designation, with 38% of candidates being female in 2018.
Beyond the glass ceiling
Like many women in finance, I bumped up against the proverbial glass ceiling on a number of occasions throughout my career. At one company function early in my career, the President of the company asked one of my male colleagues whose girlfriend I was. His assumption that a young woman in the room must be a guest, and not an employee of the firm, was disheartening. But, I certainly wasn’t going to let that old boys’ club mentality give me any thoughts about leaving the industry. At the time I honestly didn’t think much about the need to empower other women or encourage them to join this industry and that’s something I likely should’ve devoted more time and effort to. I tried to be equally supportive to anyone who reached out or needed a hand over the years, but you tend to get a lot more of these kinds of messages or requests later on in your career.
The investment industry up to this point has been designed and run largely by men, but the landscape of who earns money, how much, and how household finances are run has changed dramatically over the years. Consider the following statistics:
- 40% of all US households have a woman as top earner (a 400% increase since 1960)1
- 41% of Canadian women have control over their own and/or their family’s money2
- Canadian women directly control $2.2 trillion in assets, and by 2028, it’s expected women will control one third of all financial assets in Canada3
- Women hold more than 50% of all associate, bachelor, masters and doctoral degrees4
That said, 86% of investment advisors are men5, and just 10% of key leadership positions are held by women in North America6. From these statistics, we know that more needs to be done to change the level of female representation amongst advisors and business leaders.
Why is this important as an investor?
So why does this all matter? Men and women can view investments through a different lens. Studies have shown that women tend to be longer-term thinkers, putting more emphasis on the future, figuring out how to make their money last and support them as they draw from their savings, and how to leave some money for children they might have. On the other hand, studies have shown that men tend to be more focused on the shorter-term, and has greater immediate satisfaction of beating a benchmark with their portfolios. Neither scenario is good, or bad - just different. The importance is to understand the approach when providing investment advice for women and men that aligns to individual perspectives and values.
Why is this important for the investment industry?
On the other side of the desk, the investment industry has more work to do when recognizing on equal footing, the contributions made by men and women. The fact is the investment industry is vastly outnumbered by men, and while a lot has improved and changed over the years, we still have fewer than one in five CFA charterholders who are female.
Great strides have already been made to see more women take an interest in working in the investment industry, but greater shifts are needed to move the needle on a culture that’s deeply imprinted on each of us. Often starting as little kids, girls are dressed in pink and thought of as more delicate than boys. Through to adulthood, women are labelled bossy while the men are strong leaders for exhibiting the same behaviours. The good news is the standard is continually being raised, as more opportunities are available to support both female investment professionals within the industry, and female investors to become more confident as investors while navigating the world of investing. It is up to each of us to actively listen, and respectfully consider the perspectives, dreams and values of every investor, no matter male or female, that fosters confidence and financial success.
ATB Wealth consists of a range of financial services provided by ATB Financial and certain of its subsidiaries. ATB Investment Management Inc., ATB Securities Inc., and ATB Insurance Advisors Inc. are individually licensed users of the registered trade name ATB Wealth. ATB Securities Inc. is a member of the Canadian Investor Protection Fund and Investment Industry Regulatory Organization of Canada.
1 New York Life Investments: Women and Investing www.nylinvestments.com
2 CIBC Study via CBC article “Canadian women control financial assets of $2.2T, CIBC says”. © 2019
3 CIBC Study via CBC article “Canadian women control financial assets of $2.2T, CIBC says”. © 2019
4 New York Life Investments: Women and Investingwww.nylinvestments.com
5 Ellevest www.ellevest.com
6 CFA Institute “Gender Diversity in Investment Management” © 2016