Review of the Equal Opportunity for Women in the Workplace Act 1999 – Submission
Financial Services Institute of Australasia
The Financial Services Institute of Australasia (Finsia) welcomes the opportunity to provide a submission to the Office for Women in the Department of Families, Housing, Community Services and Indigenous Affairs, regarding the review of the current EOWW Act. Finsia supports the reasons for the review as outlined in the Terms of Reference and strongly advocates equal opportunity for women in the workplace.
Finsia is the only professional association representing the entire spectrum of financial services throughout Australia and New Zealand. Our reach extends to more than 17,000 individual professionals working across the broad categories of banking, wealth management and capital markets. We play a critical role in promoting industry growth through research and policy initiatives, as well as providing a comprehensive suite of career support services and relevant high quality professional development and networking programs for financial services professionals.
In July 2008, Finsia conducted research in association with Roy Morgan Research to examine the patterns of the Australian financial services industry workforce over more than a decade between 1997 and 2007 (and the significant trends influencing this period). Below are some observations arising from the findings report Closing the talent gap – building a global financial centre, which may be of interest to this review:
- Despite the fact that the labour force participation rate of women in Australia has increased over the last 30 years, participation rates in the financial services industry have been disturbingly in decline. By 2007, the proportion of females working in the finance industry had fallen three per cent to 45 per cent since 1997. Notably, Finsia found that the proportion of women working in the finance industry declines much more sharply after age 45, suggesting a structural impediment within the finance sector to re-employing women post child-bearing.
- Women are employed at disproportionate levels to men in the finance sector, in terms of both roles and income levels. Men working in financial services are much more likely to have managerial occupations than women, who were found to be more likely to hold clerical positions. The research also found that women employed part time in the finance sector are also twice as likely to be in clerical positions as men in equivalent positions in the finance industry (65 per cent for women, compared to 32 per cent for men). This disparity is supported by recent Government research which revealed that men hold 92 per cent of directorships and 98 per cent of S&P/ASX 200 Index chief executive jobs.1
- The Finsia/Roy Morgan report also highlighted that the average personal income for men in full time employment in the finance industry is significantly higher than for women across all groups with the difference in the income level more acute in the 45-59 age group. The average personal income for men employed part time in the finance industry is also usually higher than for women, with the exception of the 14-29 age group. This pattern has also been echoed in Government research which found that men get paid 17 per cent more than women for doing the same job.2
The striking contrast between the rising number of women in the workforce overall, and the declining number of women in the finance sector, places the industry on notice. Not surprisingly, this under-representation of women across the industry is also reflected in the proportion of women who make up Finsia’s membership base.
To this end, Finsia is concerned and committed to closing the gender gap in the finance sector and is aware of the need to reposition the financial services industry, so women are not only better incentivised to join the industry in the early stages of their career, but also encouraged back at later stages of their career cycle with, for example, the availability of paid maternity leave, child care facilities and flexible work arrangements.
The employment patterns mentioned above are also reflected in a comparative national superannuation savings gap. Recent research conducted by Finsia, in partnership with UMR Research, confirmed this gap through an examination of the impact of the GFC on the generational wealth divide, which provided fresh insights on a broad range of issues including household debt and savings levels, retirement planning and the consumer investment strategies of Australians. The report Changing Tides - consumer finance and the generational wealth divide found overall, that a higher percentage of female than male Australians say they are not confident that their superannuation will provide enough money to live on when they retire (71 per cent of women compared to 61 per cent of men).
This concern was also evident in July 2006, when Finsia’s Consumers Affairs Taskforce engaged with several organisations (including the Office for Women), and conducted nation-wide research into the barriers and disincentives towards saving for retirement, with a particular focus on women. Some relevant findings of this public opinion research - Saving the Future, are outlined below:
- The superannuation system in Australia creates a rift between those who do not participate in full-time employment and those who do. Therefore women’s retirement savings are impacted by taking time away from paid work and returning to the workforce on a part-time basis.
- The research found that women have a reduced financial capacity to contribute (individually) towards their retirement planning, as women worked significantly less hours compared to men and were more likely to have time out of the workforce to raise children. Women were also found to be more likely to consider they had insufficient savings for retirement.
- The most serious consequence of this gender gap in levels of retirement savings is the likelihood of poverty for women in retirement. As research undertaken by the Australian Human Rights Commission indicates, due to a lesser capacity to contribute to their retirement, single elderly female households have the highest incidence of poverty compared to other household types, and are at the greatest risk of persistent poverty.3
Following these findings, Finsia held a summit to examine the scope for policy initiatives to be developed to address the key barriers experienced by women in saving for retirement, and undertook economic modelling for new super incentives to overcome these.
As a membership organisation, Finsia is focused on building the professional development of its individual members. In an effort to encourage more women into the finance industry, Finsia’s Women in Finsia special interest group acts to alleviate some of these barriers by connecting women working in the financial services industry through professional development and networking events. Held regionally throughout Australia, the Women in Finsia leadership series events feature key note female speakers and provide a platform to connect women working in the financial services industry through professional development, mentoring and networking events.
Finsia would welcome any opportunity to collaborate with the Office For Women on policy research and broad awareness-raising campaigns in the future. If you have any questions about any issues raised in this letter, please contact me on (02) 9275 7900 or Rachael Norcott, Finsia’s Manager – Policy & Public Relations on (02) 9275 7923.
Yours sincerely,
Dr Martin Fahy
Chief Executive Officer
- Australian Bureau of Statistics, Average Weekly Earnings, May 2009, Cat No 6302.0 (2009).
- ibid
- Australian Human Rights Commission issues paper, Accumulating poverty? Women’s experiences of inequality over the lifecycle, September 2009.
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