International Women’s Day was on 8th March, with this year’s theme being ‘Choose to Challenge’ – to challenge, namely, gender bias and inequality in all its forms. This, of course, is an issue that matters not just on an official awareness day, but all year round, as only a sustained effort can deliver the systemic change which will make our society fairer. At finnCap Group, our sustained effort has yielded a workforce of which 40% are women.
But ensuring that women are represented in the workplace is far from the end of the matter. To achieve genuine cultural change across our society, we need more women role models in leadership positions. It is therefore vital that UK businesses foster a culture of inclusivity on a consistent basis, not just on International Women’s Day, to facilitate an increased number of female executives – something that is currently sorely needed.
Improving company culture
Indeed, while the recent Hampton Alexander Review indicates that all FTSE 350 companies now have at least one female board member, many firms have achieved this by promoting women to non-executive directorships. In contrast, there are still only 17 female CEOs across the FTSE 350.
Of course, remedying this flatlining female executive pipeline is not a matter of removing men from the equation. Instead, it is about shifting the corporate culture, with flexible working and progressive maternity policies promising to level the playing field.
A rare silver lining of the pandemic has actually been the greater attention paid to this issue, with many more businesses than before more acutely aware of the pressures of balancing working life with the demands of childcare, a challenge which disproportionately affects women.
However, Covid-19 also risks unravelling years of progress made on the road to gender equality. While the compounded pressures of work and home life are now better publicised, they continue to impact negatively on working women, many of whom struggle without adequate support to combine full-time jobs with home-schooling and caregiving. This results in many women leaving the workforce before being elevated to decision-making positions, which only perpetuates the problem of outdated company culture.
As we hopefully emerge from the pandemic, therefore, we should ‘choose to challenge’ businesses to ensure that they make work more compatible with family life and caring responsibilities.
Levelling the playing field for capital
Many female founders face particular difficulty when trying to raise capital for their businesses. A recent report by Extend Ventures, for example, found that 68% of the capital raised across the seed, early, and late venture capital funding stages went to all-male teams. Conversely, just 3% of this capital went to all-female teams, who also raised lower sums of money on average than their male counterparts at every funding stage.
This, like the lack of women seen at the executive level, is a consequence of a gender-biased corporate culture. Now knowing that women are systemically disadvantaged by the rigidity of traditional business hours, how many venture capital firms have flexed-up their office hours to allow founders with other commitments, and without pre-existing ties, to connect with investors and receive invaluable advice?
Women will also benefit from this opportunity to develop their business networks, as start-up founders are 13 times more likely to secure funding when they are recommended to a venture capital firm by a mutual contact. This integral role of ‘who you know’ as well as ‘what you know’ has traditionally favoured men, who have generally faced far fewer barriers to entering the business environment in the first place. It is time women were afforded the same opportunities.
These cultural issues transcend any individual company, and all firms have a role to play in tackling gender bias and inequality. At finnCap, we are guided by our ESG principles at every turn, and one area we have identified as ripe for positive change is education.
We want to encourage more young women and girls to take their own ambitions seriously, to teach them that they too can found and lead their own businesses. We are therefore proud to announce that finnCap Group will work with Founders4Schools and YourGamePlan to foster girls’ interest in entrepreneurship from an early age. Bringing educators and business leaders together in this way represents an investment in future generations of female founders whose potential simply needs to be supported.
But we cannot undermined these efforts by failing to implement cultural changes at the highest level of business. Indeed, there is no point investing in a brighter future for young female entrepreneurs if they still face the same barriers to capital and senior positions. Addressing gender inequality, as with any ESG initiative, requires an integrated approach.
That’s why to help businesses adopt the approach necessary for making a genuine impact, we recently partnered with sustainability fintech company World Wide Generation, providing our clients with access to WWG’s cutting-edge digital sustainability monitoring and measurement platform. Incorporating metrics from finnCap’s own ESG Scorecard, this platform can help small- and mid-cap quoted companies with an objective means of measuring their ESG performance against key policies standards, and frameworks.
Ultimately, there is a great deal of work for businesses to do to establish a fairer society. Clearly, it will require a collective effort to be sustained far longer than the 24 short hours of International Women’s Day. But it can be done, and it must.