Banks, pensions, and sovereign funds fail to achieve gender balance, finds OMFIF

Gender lens

Less than 1 per cent of central banks, sovereign funds, public pension funds and commercial banks have achieved gender balance within their workforces, according to a comprehensive survey by Official Monetary and Financial Institutions Forum (OMFIF). 

Think tank OMFIF surveyed 540 institutions on gender diversity among senior staff, and found only three that had achieved perfect scores for gender balance among their senior staff, while another 12 were “close to achieving balance”. 

The three highest ranking institutions were US central bank The Federal Reserve Bank of Richmond, Australian sovereign fund Victorian Funds Management Corporation, and Danish pension fund for nurses and medical secretaries, Pensionskassen for Sygeplejersker og Lægesekretærer.

In 2021, there have been a number of high-profile appointments of women in finance, from Jane Fraser taking over as CEO of Citi, to Valérie Baudson being named as Amundi’s next chief executive and Janet Yellen becoming the first ever female US treasury secretary. 

More financial institutions are recognising gender equality as an opportunity, with McKinsey predicting that promoting parity between genders could unlock as much as USD13 trillion in global output by 2030.

OMFIF says there is more work to do to promote gender parity, after its study reveals that more than one in 10 financial institutions still have no women at all in their executive teams or on their boards.

Commercial banks led the way with the highest average score of 29.9 in OMFIF’s gender balance index, in which a “perfect” balance earned a score of 100. The index was weighted according to seniority, with governors and CEOs weighted the highest.

This compared to an average score of 27 for central banks, 25.4 for pension funds and 18.6 for sovereign funds. Among the lowest scorers, sovereign funds, less than a quarter have any women at all in senior management. 

Top-performing pension funds according to gender balance were mostly based in Europe, including London Borough of Enfield Pension Fund, Switzerland’s Pensionskasse der Stadt Winterthur, and Sweden’s AP6 and AP1 national pension funds.

This was in “stark contrast” to Asia Pacific’s pension funds, which had an average of 19, less than half Europe’s regional average of 47. OMFIF says Asia Pacific’s average was “weighed down” by the world’s largest asset owner, Japan’s Government Pension Investment Fund, which has no women among its top executives, nor on its board of governors. 

“By confronting people with the numbers, we hope to mobilise decision-makers towards improving results and measuring progress,” says Danae Kyriakopoulou, Chief Economist and Director of Research, OMFIF.

“The conclusions are clear: lack of diversity in the field is a structural, persistent problem. Progressive policies are needed to correct the historic under-representation of women and level the playing field. And, while more balanced talent pools bring hope, the issue will not go away by itself.”