In a consumer survey by the Boston Consulting Group (BCG) of 12 000 women from 21 countries, 73% of respondents said they were unhappy with the level of service offered by their financial provider and 71% were unhappy with the product offering.
The majority of women surveyed believe that their gender was a key factor in the way they were negatively treated, citing that they had been met with disrespectful attitudes, condescension and been offered “one-size-fits-all” solutions, among other issues.
While the 2017 Old Mutual Saving & Investment Monitor (Monitor) didn’t measure South African women’s current level of satisfaction with local providers, research shows that women continue to doubt their own ability to transact with their banks or financial advisers on equal terms.
When asked to rate their ability to make good savings and investment decisions, 33% of women in the Monitor rated their financial confidence lower than five out of 10 (this number was only 26% for men).
The financial services sector has the necessary tools to assist women, but the way we approach our offering needs to be relooked as it goes much deeper than simply introducing a product or service just for women.
Looking at a number of comments made by women in the 2009 BCG research, they are particularly vocal about the companies’ attitude towards women, disrespect shown, and a one-size-fits-all approach.
Women have the same day-to-day financial needs as men. Women want a sensible array of products that do what financial products are expected to do.
The current product offering by the major South African financial services companies is world class and in line with the very broad financial and investment needs of the South African client base.
There is, however, a large selection of products and making a choice can be daunting if you are not financially confident.
In the collective investment space alone there are 1 556 funds, up by 153 funds from the same time last year. If you look at the low confidence level women already have in this regard, creating “special” funds for women is unlikely to make them more financially successful.
I believe the issue is a deeper one and financial companies need to find a solution by appointing more women in management in order to educate and inspire confidence. We also need to stop using unnecessary industry jargon when we engage with clients.
Diversity in management
Diversity brings a broad spectrum of diverse minds, cultures, and experiences to connect with different audiences and drive innovation. Unfortunately, women remain underweighted when compared to their male counterparts in the financial services industry.
Research by global management consulting firm Oliver Wyman in 2016 found that while progress is being made with regard to female representation on financial services boards, it is slow.
Locally, the percentage of female members of executive committees in financial services is recorded at 27%. This still means that approximately only one in four top-level management positions in the financial services sector is held by a woman.
In a 2016 EY study of nearly 22 000 companies, those with a leadership contingent of at least 30% women, on average, made 15% more profit.
We need to create more female leaders and make the working environment more inclusive for women. As well as ensuring that more women work in managerial roles, financial services companies should train up more women as financial advisers as currently 70% of certified financial planners are men.
Companies need to recognise, celebrate and seize these differences. If they fail to create diverse teams, companies become susceptible to “groupthink” – the phenomenon where, by engaging only with those who share a similar view of the world, they muffle other perspectives and do not see change coming, Grant Thornton warned in its 2017 Women in Business report.
If we add diverse voices when creating and communicating investment solutions to women, we will have more success than by just launching a new all-women fund.
Confidence and communication
Another pressing issue in the financial services industry is jargon and financial education. According to Focus Group Consulting, many adviser firms don’t promote an understanding of basic principles of finance. An enormous amount of jargon is used, which causes confusion. It is called the “curse of knowledge”.
I consider it my responsibility as a woman in the financial services sector to enhance how we, as an organisation, relate to women, as I believe there is much more that can be achieved. There are a few ways to tackle the problem in our industry:
1. We need to interact with clients in an easy-to-understand manner.
2. We need to simplify the myriad of solutions out there.
3. We should treat women as equals and with respect and dignity.
4. We need to help women become more confident in transacting in the financial services sector.
5. We need to change the way we interact with people (and women).
This cannot be achieved by the added complexity of creating a female range of financial solutions.
Elize Botha is managing director of Old Mutual Unit Trusts.
This article originally appeared in the October 2017 edition of Collective Insight, which appears in the 19 October edition of finweek. Buy and download the magazine here.
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