We all know the stories, there are more men called Dave running FTSE 100 companies then
there are women in the CEO role. In May 2024, Ali Crossley, Retail Managing Director of
Distribution, Legal & General, broadened this to include the names Simon and Andrew. You
get the picture. Women remain underrepresented in the top roles in the FTSE 100 despite
all the well-intentioned noise in the system to change this. There are many more women on
FTSE 350 boards now than ever before, from just 9.5% in 2011 to over 42% today. That’s
great progress.
So what’s the problem?
Look closer, below the top 350 companies, and the picture changes. The fintech industry considers itself a disruptor, a driver of change and a growth engine, but the picture isn’t quite as rosy. According to an EY report last year, whilst women represent 44% of the broader financial services sector, they represent only 28% of the UK fintech workforce. Looking closer still, at leadership levels in fintech, the numbers worsen. Women hold only 10% of fintech board seats, representing less than 20% of company executives.
As a fintech founder, and now CEO of another growing fintech, I appreciate that the smaller end of the fintech world is not for everyone. If you’re a successful female leader in financial services, seeing good career progression and visibility in your role, why would you join a fintech? Where there’s often a lack of visibility, a higher gender pay gap and the well-known challenge of raising investment as a female leader. The sunlit uplands of financial inclusion haven’t shone their light to this part of the sector yet.
Yet here I am along with so many other female founders or founding team members, intent on creating successful businesses against the obvious barriers. We keep going because we know that we can make a significant difference to the sector, the economy and the women who are following in our footsteps.
Research shows financial gains with female founders
There are numerous research studies, including a recent one from Innovate Finance and
partners, showing scaleup fintech firms with female founders achieved 30% higher turnover
growth compared to male founders. This despite only 16% of these firms having female
founders.
Having diverse teams is important in product development, offering diverse perspectives
and insights that help to ensure customers’ interests are best served. WEF data shows that
when women are better represented in leadership roles, more women are hired across the
board.
Women investors and the shift in funding decisions
Public First research is some of many that demonstrates hybrid and remote working encourages a large number of professionally educated women to return to work full time, particularly mothers. Supporting hybrid working can help more women back into full-time work, boosting the economy and widening the fintech talent pool. Female leaders are more likely to have lived experience of this need and the potential to be more flexible.
And then there’s investment, having gender diversity in decision-making roles in the organisations that matter when you’re trying to scale your company. More women are moving into the angel investment space, as highlighted by the Annual Investing in Women Code published in September 2024. Outside of the angel investment area, diversity on the investment Committees making decisions improves the outcomes for teams with at least one female founder.
Inclusion is still an aspiration, not yet a reality
Times are a changing, yet it’s clear that inclusion remains an ambition rather than a fact. I’m
not just thinking about conferences and panels, although it would be nice to see more
gender balance in those areas. Financial inclusion more broadly is the basis for so many new
fintech companies, including the one I’m now CEO of, we should apply the thinking to
ourselves. We came from such a low starting point, change takes time when it’s systemic.
However, I’m optimistic and encouraged by the progress so far, if also grinding my teeth
with impatience. As a former founder, and a CEO, I don’t want you to tell me you value
diversity and inclusion, I want you to show me. I’ll do my part, encouraging women to be
part of the fintech system in whatever role they aspire to, banging the drum for greater
visibility across the sector and supporting my fellow fintech female founders as much as I
can.
There are increasing signs to give confidence to those of us who have been part of the fintech landscape for some time. We have welcomed the growing visibility given to the gender pay gap discussion for larger companies, the creation of the Women in Fintech Powerlist and some of the direct regulatory and government interventions that have led to demonstrable change. It’s starting to feel more inclusive, this can only be good for growth.
Zitah McMillan is CEO of AI-powered credit risk and analytics platform, Finexos. She has over 15 years’ experience holding C-Suite and Board positions at international financial services organisations, is a Board Trustee at the Money Advice Trust, formerly a Non-Executive Director at ZOPA P2P and was previously on the Executive of the FCA.
The post Diversity in fintech: Why female leaders are key to industry’s growth in the UK appeared first on Tech Funding News.