April 28, 2021
April 28, 2021
Contributor: Rob van der Meulen
Ethnic diversity in finance is one of the lowest across corporate functions, and the news is mixed when it comes to gender diversity. Learn more about the measures finance leaders can take to move the needle.
Diversity, equity and inclusion (DEI) has never been more important to CEOs, shareholders, employees and customers. However, finance may find that aspects of diversity deteriorated while it was busy handling the COVID-19 crisis.
Corporate finance and accounting performed poorly in a number of key DEI metrics in a Gartner labor market survey taken in 2Q20. Results revealed that people of color make up just 11% of the total workforce in corporate finance, and just 6% of senior finance roles. This is 6 percentage points lower than the average corporate department.
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“Finance’s DEI underperformance isn’t just a hiring problem to manage via HR,” says Kotei Kotey, Principal, Advisory, Gartner. “Finance leaders have a direct impact on this issue not only in managing their own function, but also through the extent to which they prioritize funding for corporate-level DEI initiatives.”
Here’s how finance leaders can help improve diversity recruiting and reduce bias:
Compared to all other departments, finance performed better in hiring women, with 52% of employees being female, significantly higher than the average of 42% for all departments. But there is still room to improve here, as the performance dropped off when it came to senior roles. Women made up nearly 60% of junior roles but only 40% of senior positions.
“There needs to be a plan for advancing women and people of color to higher level roles,” says Kotey. “One of the best ways to do this is to connect junior employees with more senior mentors from similar backgrounds. This is why it is doubly critical to show clear pathways for advancement to diverse candidates, so there are senior-level mentors to offer to junior candidates.”
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Gartner experts also recommend these steps to build clear career path clarity for diverse candidates:
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Recommended resources for Gartner clients*:
The State of Diversity, Equity & Inclusion in Finance
*Note that some documents may not be available to all Gartner clients.