The State of Gender Diversity in Hong Kong’s Financial Services Sector
Hong Kong Exchanges and Clearing (HKEX) runs the third-largest stock market globally, capitalized at US$7 trillion. For more than a year now, it has required listed companies to disclose their board diversity policies. HKEX itself has a female chair in Laura Cha Shih May-lung, who served as the first woman vice-chair of the China Securities and Regulatory Commission. Two other women accompany her on HKEX’s 13-person board, and 35% of HKEX’s senior management are female.
Unfortunately, HKEX is not representative of the state of gender diversity in HK. For example, women comprise only 14% of major listed companies’ boards - compared to 34% in the UK and 28% in the U.S.
HK’s financial services (FS) sector, which accounts for roughly a fifth of the city’s economy, is slightly above this average, with 20% of director-level roles filled by women, according to a 2018 PricewaterhouseCoopers (PwC) report. So, what accounts for this lack of diversity, and how can it be addressed?
The Women’s Foundation/PwC 2018 HK FS Gender Diversity Report
An NGO established in 2004, The Women’s Foundation aims to improve the lives of women and girls in HK. Together with PwC and several female chief executives in FS, it released a 2018 report looking at the state of gender diversity in HK’s FS sector.
At the time of the report, the FS sector employed 7% of HK’s workforce (263,000 employees). Women comprised 52%, approximately 33%, and 20% of staff at the junior, management, and executive levels, respectively. To understand this pattern, researchers addressed five common gender preconceptions to see if the data supported them:
Diversity recruitment measures are needed to put women in senior positions.
Findings indicated that leaders’ direct involvement and engagement with smaller communities to define their own diversity goals were more effective than formal recruitment policies. Leading by example and creating a diversity-supportive culture seem to be the most critical factors in promoting diversity and inclusion.
Women aren’t represented at senior management because they leave the workforce to start families.
Data indicates that lack of career opportunities and promotion are the most significant reasons women leave the workforce. Therefore, organizations need to track their gender mix at different levels within the organization and understand what’s driving it - promotion, recruitment, or attrition.
Succession planning and leadership development are needed to retain women and advance them to senior roles.
The majority of women in senior roles think sponsorship would aid in getting more women into senior roles. Creating formal training, mentoring, and sponsorship programs for both men and women can help produce an empowering work environment.
Flexible workplace policies will improve female representation.
86% of respondents surveyed felt flexible workplace policies were necessary to enable both men and women to carry out their responsibilities at home. Gender-neutral flexible work arrangements that don’t attract stigma should receive priority. It may be necessary to require employees to work flexibly rather than expect them to ask for permission.
Women get paid less than men.
All the institutes surveyed had policies in place to ensure equitable pay across genders. However, while drafting the report, the Women’s Commission reported not only a 22% wage disparity across all HK sectors, but also that women in FS were paid HK$8,800 less per month than their male colleagues.
Researchers also commented on the differences in perceptions of workers with regard to gender-discriminatory pay. For example, 72% of women felt women were paid less than men, but only 23% of men felt this was the case. Thus, transparency in compensation is key to reducing gender-discriminatory remuneration and increasing trust and accountability.
What Do HK’s Female Executives Say?
Angel Ng, the CEO of Citibank HK, sums it up when she says, “The nature of the financial services industry is that it is demanding and highly intensive. Work-life balance is an issue, and there is little uptake of flexible working policies that are already in place.” Nevertheless, she says that her bank has an equal number of male and female workers and that women comprise 49.5% of middle and senior management. This could result from Citi HK’s program that supports new mothers in returning to work. Although, as Amy Lo, co-head of wealth management in Asia-Pacific, UBS, points out, the availability of affordable domestic helpers in HK should mean more opportunities for women than in other markets.
Louisa Cheang Wai-wan is the CEO of Hang Seng Bank, which boasts a 53% female executive committee - the highest of any retail lender. She comments, “Our approach to diversity is centered on creating an internal culture that is inclusive and built on systems of meritocracy. We view greater internal diversity as a way to drive growth and as an important business advantage.”
Maaike Steinebach, general manager of Visa Hong Kong and Macau, says research proves diverse teams are more adept at problem-solving and recognizing opportunities than male-dominated teams. She sees her challenge as a leader being to ensure “that such diverse thoughts are consistently factored into our business strategy and decision-making.”
The Future Looks Bright
On a more positive note, 45% of HK’s entrepreneurs are women, making it second only to India. Not only does self-employment bypass the institutionalized prejudices of traditional corporations, but the startup environment is characterized by youth with fewer stereotypical ideas about gender roles than their parents’ generation.