Women now make up around 20% of the total number of fintech executive roles globally.
But a Sifted analysis of European data suggests that Spain is the only country that meets the global average for female representation in fintech c-suites.
It should be noted that the data was collected at different points over the last three years and with varying methodologies. Nonetheless, the results clearly suggest that Europe is lagging behind the global average.
This data* goes beyond the question of female founders by looking more broadly at women in leadership. It complements existing data around the European investment gender gap, the board gender gap, and the pay gap among the fintech workforce.
Unicorns under the spotlight
The senior executive teams at Europe's six most highly-valued fintechs also give an insight into the state of play at the top of the industry.
Of these, none have all-male executive teams and only one falls below the global average of 20% female representation.
To try to improve these figures, several top firms have made pledges to boost the number of women in positions of authority.
TransferWise has committed to having women make up 40% of "senior leadership" roles by 2021. Meanwhile, Monzo has hired a diversity chief in Sheree Atcheson to boost inclusion among its workforce. It also signed the Women in Finance Charter, pledging to have women make up at least 40% of their executive committee and board by 2020 (although it has so far fallen short).
Room for optimism?
European fintech has a gender problem, but there may be some signs of progress.
Firstly, the number of women working in fintech seems to be growing at speed in some European states.
Spain's 2019 study revealed that 57% of fintech employees in Spain are women, meaning they're actually in the majority. This was double the number reported the previous year.
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Meanwhile, in Lithuania — Europe's second-biggest fintech hub — 60% of fintechs have a sizeable female workforce, with women making up at least one-third of their employees.
In addition, over half of Lithuanian fintechs have one or more female executive. This can be compared to 2015 stats, which showed that just 7% of executives in European fintech startups that raised venture capital funding that year were female.
If it's not broke, why fix it
There's still room to improve at both the executive and the board level — in Europe and beyond. Indeed, at the global level, digital banks fare worse than incumbent banks by way of female board representation (as shown below, on the right).
But why change it?
On a purely financial level, many studies show that diverse leadership correlates with improved profitability and productivity.
This is why one Swedish hedge fund — SHE Invest — only invests in public companies that have one of the following criteria: i) 40% women in the board, ii) 40% women in the management group, or iii) a female chief executive/chairman.
Within this, the fund has selected around 25 companies based on their financials. The "activist" fund currently ranks 17th out of around 300 Swedish funds in terms of returns.
Anthemis, a leading fintech-focused VC, also says diversity among founders is "hard-wired" into its strategy. Indeed, they have a record 16 female founders across their fintech portfolios and are one of the most respected VCs in Europe.
Gender inclusion offers more varied ideas and insights into customer demands, says former analyst at Octopus Ventures Juliette Souliman. "Gender diversity is integral for fintech’s future success as women bring different ideas and ways of executing them to the table," Souliman says.
- Sifted will be publishing a list of Europe's top female fintech founders and execs next week
By way of practical solutions, she outlines the need for getting women in fintech greater access to capital, networking and visibility. One such initiative includes the WIFTN podcast, which interviews some of fintech's leading women from across the world.
A brief note on the data
'Executive' is a slightly fluid term. It's typically the most senior people who sit in the c-suite and then report to the board, hence they have 'chief' in their title like CMO or CEO.
So for example, at Monzo's we've counted their CPO, CEO, COO, CFO, CFO, CTO-interim, US CEO.
Transferwise uses a range of labels for their c-suite, which also includes individuals with 'Global' in their title; denoting execs who head-up international operations.
Separately, for the country analysis, the gender data for Germany is unusually sparse. Therefore, we used the ratio of fintech female founders in Germany as the only verifiable proxy for the number of executives. This is consistent with the fact the number of female fintech bosses is clearly limited in Germany. One analyst said they could be counted on one hand. Another point of comparison is that while 4% of German fintechs were founded by women (according to Dealroom data), that number now sits at 25% in the UK.
- France Fintech report with Roland Berger from April 2019 on diversity
- UK Fintech Census 2019, by EY & Innovate Finance
- Stockholm Fintech Report 2018 (Stockholm accounts for almost all of the country's fintech)
- Spain's AEFI Fintech Women Network Report
- Fintech Landscape in Lithuania report, by Rockit and Invest Lithuania
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