Women work more and earn less in the finance sector, research indicates

"We can see that women work more and are less remunerated compared to men within the financial market in Brazil," says Claudia Yoshinaga, coordinator of the Center for Studies in Finance at Fundação Getulio Vargas (FGVcef). The professor led the publication of an article that demonstrates how women are underrepresented in the Brazilian finance sector, both in terms of positions and remuneration. Additionally, the study, published in the June edition of GV-executivo magazine, also points out ways to change this scenario.

To conduct the research, a questionnaire was applied to 214 people working in the finance market to understand the challenges for female participation in this area. Among the participants, 39.25% were women, compared to 60.75% male participation.

However, what really stands out, according to Yoshinaga, is the fact that even though they are a minority in this area, the women who participated in the research work about 60.4 hours per week, a higher average workload compared to men, who work an average of 57.8 hours in the same period.

Women in finance careers

Data from the Think Tank Official Monetary and Financial Institutions Forum (OMFIF) indicate that women occupy only 35% of the boards of the world's 50 largest commercial banks. In leadership positions, this rate is even lower, reducing female participation to 19%, with only 16% of CEOs being women.

When it comes to finance, gender inequality in Brazil is even greater. While worldwide women make up 18% of professionals certified by the Chartered Financial Analyst (CFA), a fundamental certification for working in the financial market, in Brazil this rate drops to 11%.

The idea to research this topic came from former FGV administration student Laura Gomes, who decided to investigate the presence of women in the financial market after reading the book Wall Street Women.

"I was at the beginning of my career in the financial market and wanted to understand the trajectories of other women in this segment. This research was a very rich way to capture the experiences, challenges, and successes of these professionals and understand through the collected data if the reports were part of the dynamics of this market. The research brought lessons that were valuable to me and which I hope will be useful to more professionals in developing their careers," said Laura Gomes.

In this FGVcef study, the initial education of people working in this area was also investigated. Among the men and women participating in the research, 63.55% have a degree in Administration, 14.95% in Economics, and 12.15% in Engineering. This result is closely related to one of Professor Claudia's biggest concerns, which is the presence of women among Administration students.

Although data from the National Institute for Educational Studies and Research Anísio Teixeira (Inep) indicate an increase in female participation in the administration course, the professor has noticed a decrease in women in this degree over the past few years. According to her, if this participation is narrowed down to other areas within administration, such as finance, female participation decreases even more.

"As a professor at the São Paulo School of Business Administration (FGV EAESP), one of the leading references in this area in the country, the reduction in the presence of female students in our administration course is something that worries me. We are thinking of ways to motivate these women to enter these areas, but first, we need to think about how to make these environments more inviting," highlighted Yoshinaga, who is the first woman to coordinate the Center for Studies in Finance at the Foundation.

Salary and professional growth

In addition to less representation and lower remuneration, women also tend to face more difficulties when it comes to professional growth within this sector. Among the research participants, approximately 30% were in the position of analyst, 6.5% as interns, 13% associates, 15.9% managers, 7% superintendents, 8.4% directors, 2.8% vice presidents, and 11% were partners.

Although the distribution among analysts is almost the same, when it comes to higher positions, female participation drops drastically, with women occupying only 7% of leadership positions. "Women are a minority at the top of the financial career and deal with a double glass ceiling: reaching managerial positions and higher-paying roles," Yoshinaga emphasizes.

Figure 1 - Graph on professional growth between men and women in the finance sector. Source: Checon et al. (2023).

Regarding salaries, the study found that women are at the top only in the highest positions, such as partner or director. In the others, from intern to superintendent, there were no women with higher remuneration than men occupying the same position, especially when it comes to the analyst position, which has the best gender distribution.

Figure 2 - Graph on salary growth between men and women in the finance sector. Source: Checon et al. (2023).

Another type of inequality in this sector can be associated with the sub-areas of the finance market, where men are the majority in Asset Management, an area responsible for managing and investing the assets of a person or company. Commercial and Sales, Information Technology, and Investments are other examples of this area that have a majority of male professionals.

"The only sub-areas where women are the majority are those related to administrative and support functions, where women represent 10.7% compared to 5.4% of the male portion interviewed in this research," highlighted the professor. For her, this reality is related to a long history of sexism that has perpetuated in society for generations and keeps women away from the areas of Science, Technology, Engineering, and Mathematics (STEM, an acronym known in English).

Historical Weight and Social Heritage

Given this reality, part of this research sought to understand whether the mothers and fathers of people working in finance have higher education in STEM. It was found that 30% of the fathers of those who participated in the research are trained in Science, Technology, Engineering, or Mathematics, while only 11% of the mothers have training in these same areas of knowledge.

Yoshinaga highlights that this is a very relevant data point, as there is scientific evidence that daughters of mothers trained in these areas tend to have a greater predisposition to pursue careers in exact sciences, due to dealing with this inspiring model from an early age. Male children, on the other hand, tend to grow up with a different mindset in the face of the same example.

According to the researcher, it is also necessary to consider that, in addition to formal work hours, women often balance these demands with domestic activities, motherhood, and other responsibilities. "If we took all these factors into account, the disparity in hours worked between the two genders could be even greater," she declared.

Furthermore, the professor recalls that historically women have been linked to domestic chores, and this common sense persists to this day, suggesting that women are less efficient in the exact sciences. To illustrate how this prejudice is rooted in society, she gives examples within the Portuguese language itself.

"Well, all the wealth you accumulate in life in terms of money and material goods is classified as 'patrimônio' (patrimony), while 'matrimônio' (matrimony) is characterized by marriage. The Portuguese language itself was conceived under this bias that women are associated with domestic work and therefore would not be apt to deal with finances," commented the professor.

She states that this entire scenario is contradictory, as numerous socioeconomic data from the country indicate that the majority of Brazilian households are headed by women:

"In other words, women can manage a household but not a company? In the past, women could not work, and as they were limited to matrimony and did not earn their own money, they basically had nothing to manage besides the family environment. Much later, when women already occupied various spaces in the labor market, there is still the perverse culture that finance management is not for them."

According to Yoshinaga, this entire historical and social scenario, with women inserted in homes and families where the culture perpetuates this type of thinking, is combined with a labor market with unfavorable conditions for women. For her, these factors increase the conviction among women that it is not possible to enter the finance sector.

"This is a cultural weight on women; they are hindered from childhood, and although we have seen improvements in recent years, it is necessary to understand that this is about breaking the system transgenerationally. Therefore, a part of this project included research on the education of the mothers and fathers of people working in finance, to measure how far we have come and where we are in terms of breaking these gender stereotypes," said the researcher, adding that this study also reviewed literature on the presence of women in the labor market.

Transforming Reality

Yoshinaga explains that due to all this culture, the finance market can deter talented women from entering this career, and to combat this, it is necessary to make this environment more inviting. "Showing our achievements and saying that we have a chance to change this scenario may be the initial steps," she said.

She adds that it is necessary to create public policies capable of strengthening the presence and growth of women in this area. "First of all, it is necessary to encourage the education of women in finance, as well as offer specific job openings for women and create transparent promotion and remuneration policies."

Other actions that can also contribute to changing this reality include promoting institutional channels for reporting harassment, improving working conditions, and more widely disseminating data on positions and remuneration in the finance sector divided by gender.

To read the full article, just click here. You can also check out the Thesis, the study that gave rise to the article, through this link. In this work, a qualitative research was also conducted with 12 women, investigating other issues about the space for women within the world of finance.