Fintech is broadly known as one of the more forward-thinking industries. Despite the fact that both technology and finance have traditionally been white male-dominated sectors, fintech leaders have spoken openly about attempting to close the gender pay gap and remove racism. But how much of that talk has actually been put into action? And is diversity, ethnicity, and inclusion (DE&I) really present in the industry? Or are we witnessing another case of DE&I washing?
Why are we still talking about DE&I washing?
It’s very easy to put beautiful pictures of diverse teams on a website. To write about DE&I commitment. To speak about it in the press. And then fail to act. In the course of the last few years, most companies have had to re-evaluate their position on DE&I, elucidating their commitment to the cause. But in most cases, when you look at the composition of the Board or the Senior Leadership Team, it quickly becomes clear that lip service has been paid, and nothing more and this is no less common in fintech. So, where are things going wrong?
Diversity without Equity and Inclusion is pointless
Diverse representation is a simple step for businesses. Employ a few women. Promote a few people from diverse backgrounds. You’ve got yourself a team that looks good on press releases. But diverse representation doesn’t equate to people’s perspectives and experiences being included and valued. It doesn’t mean that everyone in the room is treated fairly, has equal access to opportunities, or receives equal pay.
Although the UK fintech sector has a higher proportion of ethnic diversity compared to the tech sector as a whole, according to Tech Nation, ‘the majority of people working in UK Fintech are white males (55.61%)’ and the gender pay gap is higher in fintech than in other financial services. In startups it is more than double the UK average, with women being paid 70p for every £1 paid to men. And yet 70% of male leaders believe the Fintech sector to be inclusive.
To ensure DE&I, businesses need to look below the surface. Checking that diversity is more than mere tokenism.
DE&I can only work if it becomes systemic
In 2021, Sifted reported that over a third of minority ethnic entrepreneurs in the UK are likely to give up on their business because of a lack of funding. Black-owned businesses struggle most, receiving only 0.24% of UK funding. UK Female-led fintech only made 4% of investments. And while the problem here lies with investors and venture capital, until we see ethnic and female-driven startups receiving the investment they need to develop and grow, we cannot expect true representation within the sector.
Why is DE&I such a challenge?
DE&I came to the fore through poor publicity and public pressure. Resulting in businesses making knee-jerk bandwagon jumps, leaving the details for later. And right now, the biggest challenge for DE&I is mindset. The problem seems too great to address. Leaders understand the issue. But not how to deal with it. This leads to a lack of accountability, and a lack of follow through in inclusive talent acquisition and retention. A leaning towards tokenism. And ultimately, an infrastructure that does not support DE&I.
Why should DE&I matter?
Aside from the clear ethical considerations, what many people don’t realise is that you don’t have to decide between DE&I and profit. In fact, the former creates the best environment for your company to grow. Fintechs that reflect their customer base has competitive advantages when aligning their offerings to their audience needs. Organisations that fail to see the gaps are missing out on huge opportunities. But very few people recognise this.
And until we recognise the problem it will be impossible to address.
