Financial services has had a decades-long (well-earned) reputation as a hypermasculine industry. As it looks to bring in top young talent, it has marketed itself as open to anyone, including women. That doesn’t mean high earning females are abundant…
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We’ve looked at government mandated gender pay gap disclosures in the UK for 40 different major financial services firms across investment banking, private equity, fintech, electronic trading and hedge funds. Nobody’s perfect but some sectors, and some firms in particular, really outperform the rest.
The Gender Pay Gap in Investment Banking
On average, women in British banking jobs earn £0.73 for every £1 a man earns in salary but just £0.53 per pound a man earns via bonus.
Some of the most equitable employers are UBS and Barclays. The former has the highest mean hourly pay ratio (amount earned by women in salary per £1 earned by men), as well as the highest bonus ratio. Barclays, meanwhile, has the largest number of women in the top 25% of earners of any company analyzed both in and outside of banking. The most equitable US bank appears to be Bank of America; its mean bonus ratio (amount earned by women in bonus per £1 earned by men), is almost double that of American rivals Citi and Goldman Sachs.
Indeed Goldman Sachs and JPMorgan, which can be viewed as the two most prestigious banks on the list, are two of the worst performing in terms of equitable pay. The average woman at each of the two banks earns roughly 60% of what the average man earns. JPMorgan appears to pay higher bonuses to women than Goldman, but the latter bank has more women in its top quartile of earners.
One of the most peculiar cases is boutique investment bank Lazard. There, average salary is neither great nor terrible, but the median bonus for women is more than 80% lower than the median bonus for men. While that might appear to be a bad thing, the fact that more than 70% of people in its lowest paying quartile are women might imply the bank has actually ramped up hiring for female analysts and associates. Mean bonuses at Lazard fare much better for women, suggesting there are some female high earners in its ranks.
The Gender Pay Gap in Private Equity
On average, women in private equity earn £0.60 for every £1 a man earns in salary and a measly £0.48 per pound a man earns via bonus.
Blackstone has made a huge jump in closing its gender pay gap… for salaries at least. While the firm historically paid £0.70-£0.80 for each £1 a man earned according to prior filings, the gap this year closed to 97p. Bonuses, which presumably includes the coveted carried interest that brings people to PE in the first place, saw much more disparity; women at Blackstone have been stuck earning £0.50-£0.60 for each £1 a man earns in bonuses for each of the last few years.
European PE firms aren’t nearly as equitable, it seems. The lowest mean salary and bonus are both at CVC Capital Partners, and HG Capital pays just marginally better in both regards.
Private equity also appears to be pushing much harder than banking to hire junior women. More than 70% of the bottom quartile of earners in each of the five firms are women, with Apollo seeming to have the most female juniors. This is reflected in the notably low median bonus ratio of just £0.20
The Gender Pay Gap in Fintech
On average, women in fintech earn £0.82 for every £1 a man earns in salary but just £0.59 per pound a man earns via bonus.
Fintech, which you might think is more progressive, is a sector with a lot of variation, particularly in regard to bonuses. At Starling Bank, for example, bonuses were almost equal between men and women (median bonuses were identical), but at Revolut, the mean bonus for women was 86% lower than the bonus for men. Revolut’s median bonus ratio is £0.67, which implies that there are plenty of women earning decent bonuses, but a few men at the top earning astronomical amounts.
More than any other sector analyzed, women are most likely to be in the top quartile of earners at a fintech. They occupy 27% of that quartile on average, with Monzo having the most female high-earners.
The Gender Pay Gap in Hedge Funds and Trading Firms
On average, women in hedge funds and electronic trading firms earn £0.77 for every £1 a man earns in salary but just £0.47 per pound a man earns via bonus.
More so than any other sector of finance, hedge funds and trading firms have a severe lack of high earning women. The top paying quartile of the average firm is made up of just 13.6% women, with many firms having less than 8% in their top quartile. An egregious example is Jump Trading, where just 1.4% of its top quartile are women.
The most equitable firm isn’t a hedge fund: it’s secretive London-based trading firm G-Research. There, women earn £0.91 for every £1 a man earns in salary and £0.70 for every £1 a man earns in bonus. Women also make up 35.8% of its top paying quartile; the next best performer is Brevan Howard where 23.5% of its highest earners are women.
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