Can succession planning for women break barriers in SA Financial Services?

 Phryne Williams, Founder of Capital Assignments.

Phryne Williams, Founder of Capital Assignments.

Published Jun 30, 2024


By Phryne Williams

As several annual general meetings have taken place across the South African Financial Services sector this month, progress towards gender parity has been high on the activist shareholders’ agenda.

In its annual round-up reports non-profit shareholder activism organisation, Just Share has so far put the leadership of Absa, Nedbank, Sanlam and Old Mutual on the spot over a range of gender parity issues.

Shareholder concerns include the lack of transparent reporting on the current numbers of women in senior leadership positions or if reported, the low percentages achieved, and the lack of strategic, CEO-backed plans to address critical gender imbalances in the high echelons of their corporations.

Amidst this local flurry, the World Economic Forum (WEF) has released the Global Gender Gap 2024 report. There are several points of interest for South Africa’s corporate giants.

Only one African country made it into the world’s top 10 countries closing the gender gap, and it wasn’t South Africa. While our neighbour Namibia attained the esteemed ranking of eight out of 146 countries in the world, South Africa levelled at 18 alongside Portugal and Costa Rica. In the regional breakdown, sub-Saharan Africa is third from the bottom, only Southern Asia and the Middle East regions are worse when it comes to closing the gender gap. But perhaps, the most staggering observation of this year’s report is that if global companies continue at their current pace of transformation, we will see gender parity in 2158.

Let’s be clear here, that’s five generations away. Which means that the daughters, granddaughters and great-grand daughters of South Africa’s current crop of CEOs won’t live their lives out with a fair shot at the C-suite. These odds aren’t acceptable to our younger generations.

This means we can expect to see a significant amplification of the pressures to achieve gender parity, especially in Financial Services which is a foundational sector when it comes to any country’s economic growth, transformation and inclusion. There’s a fair argument that with South Africa’s relatively high levels of education and our progressive constitution, we should at least be the country leading the way when it comes to gender parity on the African continent. But we are not. What are we doing, and perhaps more importantly what are we not doing?”

Getting more women into leadership roles in the 21st Century is about navigating the muted but still potent minefields of the lingering Old Boy’s workplace culture.

Not just in South Africa, but across the world, there is a real shortage of women with both the willingness and experience to step up into leadership roles. Pervasive glass ceilings and holding the simplest of family aspirations as a woman have diverted otherwise top female talent into professional rather than operational roles in corporations.

Strategic succession planning is an overlooked tool when it comes to achieving gender parity. Developing a strong leadership pipeline which makes sure you have at least one, unique female candidate for each key role in your organisation is where you start. It’s the basics.

Actively developing your leadership pipeline, male and female, is essential, and should be strategic. Implementing re-entry development programmes for women who paused their careers and have now returned to the workforce will obviously expand your leadership talent pool. But Financial Services companies also need to know how to retain the female talent in their leadership pipeline. This is a small, talent pool in high demand, and you are competing not just locally, but globally for these individuals.

So, what are you doing to make sure your female leadership talent will stay with you through the development years? How are you closing the gender pay gap in your company? What spaces have you created for women leaders to mentor the next generation of women leaders? What shareholding or other financial incentives have you offered to your next-generation leaders?

This highlights that Financial Services companies are facing challenges on two fronts: building female talent internally and attracting external top female talent. In both cases, there is also the struggle to retain female talent amidst fierce competition from both local competitors and global players.

Actively developing internal female talent includes strategies to define career pathways, involve junior and mid-level female employees in special projects, provide coaches and mentors as well as organisational forums that provide platforms for women to unpack their unique corporate experiences and challenges. One of the pitfalls of developing internal talent for leadership roles that must be addressed is the widening of the gender pay gap as women advance internally into leadership roles.

Competing for new female leaders externally places emphasis on the capacity of the organisation to offer a tempting, yet wholly authentic Employee Value Proposition (EVP).

Too often companies don’t put their best foot forward when engaging and interviewing potential candidates. Today’s female candidates for top roles who have competing job offers on the table, care a lot about whether a company walks its talk when it comes to gender parity, and they care about entering a work environment that is supportive of them particularly as female employees and leaders.

Flexible working conditions including the option for hybrid work, family-friendly policies and concern for work-life balance and employee well-being are now hygiene factors and will not differentiate your EVP. No matter what you say about your company’s commitment to diversity and inclusion, what counts is that candidates see this diversity in the panels you put together for their interviewing process.

Expect that they will be interested in the gender make-up of your board. So, what we are seeing in the job market is that strong female leadership talent has the luxury of being discerning, and candidates commonly have decision-making criteria that relate to transformation.

As a shareholder, Just Share has highlighted recently in South Africa that banks and other financial services companies need to embrace transparency when it comes to their gender parity targets.What are your goals and how are you tracking progress towards them? Are you using your succession planning strategically as a tool to drive diversity and inclusion? After all, the next-generation female talent won’t be inspired to believe in you on a 2158 timeline.”

Phryne Williams is founder of Capital Assignments, an executive search firm that focuses exclusively on the Financial Services industry.