NEWS
NEWS
26 Nov 2025
26 Nov 2025
Inside ACT and WIBF Gender Bias Research: How Meritocracy Falter in Finance
Inside ACT and WIBF Gender Bias Research: How Meritocracy Falter in Finance
Financial services have long believed that performance speaks for itself. In theory, talent is recognised, ambition is rewarded, and strong ideas rise. Yet four years of data from the Accelerating Change Together (ACT) programme show a different reality.
Women in UK financial services earn just 78 pence for every £1 earned by men. The 22% pay gap is almost double the national average. In investment banking, this gap is even wider. Women there earn around 67 pence to the male pound.
Also, they hold only about one-third of leadership roles, even though they enter the industry in similar numbers. Moreover, ACT’s data shows that women’s representation among top earners has declined since the pandemic.
All of this shows that the industry’s current approach to merit is not working as intended. ACT’s evidence reveals consistent distortions in how performance, readiness, and potential are judged. Our own analysis expands on these patterns and shows how they influence progression, visibility, and innovation inside firms.
Let’s examine where the gaps arise and which measures can realistically close them.
Gender Bias in Finance: Evidence from ACT
The first mechanism runs through evaluation. Financial institutions rely heavily on subjective assessments embedded in performance reviews, promotion panels, committee discussions, and informal judgments about “readiness.” This is where bias becomes most potent.
Across the ACT experiment, two candidates delivering identical financial decisions were assessed differently solely based on perceived gender. “Stephen” was consistently rated more competent than “Stephanie” despite identical outcomes. The pattern followed a familiar behavioural logic, implying that men’s success was attributed to skill; women’s success, by contrast, was partially discounted.
This matters because evaluation defines who gets access to high-stakes meetings, stretch assignments, and senior visibility. ACT shows that these decisions often follow ingrained assumptions about male competence. When two identical profiles receive different assessments, it means that even stronger performance on the woman’s side might not change the outcome.
External cases point in the same direction. For example, in 2018, Tokyo Medical University admitted that it had been lowering women’s entrance exam scores for years to enroll more men. The scandal demonstrated how deeply such norms can sit inside institutions that claim to rely on merit.
The same mechanisms appear in finance. Small distortions in evaluation compound over time and determine who receives opportunities and who remains overlooked. As these patterns persist, firms end up with narrower talent pools, weaker decision diversity, and reduced long-term competitiveness.
Promotion Gaps and the Missing Middle in Finance
The most significant leak is not at the entry level. It appears at the move into management. This “broken rung” shapes the rest of the leadership pipeline.
Limited Advocacy
Many women take on work above their grade, yet they are still not marked as “ready” for promotion. One of the core reasons is that men are far more likely to have several senior advocates. These advocates speak for them and keep their names circulating across the organisation.
Women rarely receive this kind of support, so their achievements remain visible mainly within their teams and do not translate into the visibility needed for promotion.
Visibility Bias
Visibility is another structural barrier. In many front-office and dealmaking teams, women’s input is overshadowed by louder or more assertive colleagues. When they present ideas with confidence, they are more likely to be labelled as “bossy” or “difficult.” The same behaviour in men is viewed as leadership.
These double standards shape perceptions of readiness long before formal reviews begin.
Caregiving Load & Unpaid Labour
Caregiving expectations deepen these gaps. In most households, unpaid labour still falls primarily on women due to long-standing social norms. The industry’s “always-on” culture penalises those who carry this load.
Flexible work becomes a career risk because physical presence is still treated as a signal of commitment. Therefore, true equal opportunity requires systems that recognise unpaid labour and allow women to build careers and progress on equal terms.
Taken together, these structural levers create a systematic misallocation of talent. When early promotion gates are misaligned, the leadership pipeline narrows long before performance has the chance to differentiate individuals on merit.
How Gender Bias Hurts Productivity and Innovation
Once women make up roughly 30% of senior management in high-growth sectors, firm-level innovation, valuation, and resilience increase. ACT’s analysis uses robust methods to isolate the effect of gender diversity itself.
This threshold matters because inclusive leadership changes the information environment inside organisations.
In non-inclusive cultures, employees rationally choose silence or conformity. Speaking up carries perceived career risk, particularly when dissent is punished informally or when managers tolerate dominance behaviours. As a result, the organisation loses the insights that could improve products, challenge flawed assumptions, or flag early warnings about risk.
In inclusive cultures, the “cost” of speaking up decreases. Employees offer more ideas, share early signals, and challenge consensus. This creates a wider decision surface and improves the firm’s ability to anticipate volatility.
From a financial perspective, gender bias is inefficient. It suppresses innovation capacity, reduces solution diversity, and narrows the organisation’s field of vision. A culture that distorts attribution or suppresses voice reduces the quality of decisions, mostly in areas where rapid judgment is essential.
Fixing Gender Bias in Finance
The ACT programme identifies dozens of levers, but they cluster around three system-level interventions that consistently move outcomes.
Decision-making architecture redesign
Firms that improve gender outcomes redesign the processes through which decisions are made. This includes:
structured meeting formats that prevent dominance and ensure equal airtime;
protocols that separate outcome from attribution in performance discussions;
transparent allocation mechanisms for high-visibility projects;
evaluation templates that focus on observable behaviours;
When these changes are implemented, the system relies less on informal impressions and more on measurable actions.
Career trajectories reconstruction
Career breaks, transitions, and lateral moves should not derail progression. Strong on- and off-ramp programmes, clear role expectations, and formal mentorship pathways allow firms to retain and re-accelerate talent.
For example, at Drofa Comms, returning employees go through a structured re-entry process rather than an informal restart. We assign a dedicated mentor to help the employee reintegrate after parental leave, update them on internal changes, and provide targeted retraining where needed.
Our employees can also use partial-work arrangements during or after their leave. This reduces the career penalty often associated with caregiving periods.
Crucially, advocacy must be deliberate, tracked, and tied to managerial accountability. Without structural incentives, advocacy defaults to affinity, and the latter reproduces the status quo.
Rewiring leadership incentives
Managers respond to incentives. That means when bonuses, promotion criteria, and leadership assessments incorporate inclusive leadership metrics, behaviour changes occur. Typically, these metrics include equitable distribution of opportunities, team development outcomes, or reduction in biased feedback.
Inclusive leadership is a competence that directly affects team performance and retention. When leaders are evaluated on team advancement patterns, the organisation finally aligns performance management with meritocracy.
Conclusion: Turning Finance into a Real Meritocracy
The combined evidence from ACT shows that finance does not suffer from a shortage of capable people. Instead, it suffers from a system that allocates talent unevenly. Evaluation bias, limited advocacy, visibility distortions, and caregiving penalties all shape who advances and who is sidelined. The next question for firms is whether they treat these findings as a compliance obligation or as a competitiveness imperative.
At Drofa Comms, we believe real requires systems built on data, transparency, and consistent leadership behaviour. Companies that continue to rely on informal impressions or narrative claims of meritocracy will face growing pressure. Those that redesign their systems deliberately will build stronger teams, make better decisions, and grow faster in the long run.
After all, meritocracy is an operating model. And the firms that treat it as such will outpace those that assume it already exists.
Financial services have long believed that performance speaks for itself. In theory, talent is recognised, ambition is rewarded, and strong ideas rise. Yet four years of data from the Accelerating Change Together (ACT) programme show a different reality.
Women in UK financial services earn just 78 pence for every £1 earned by men. The 22% pay gap is almost double the national average. In investment banking, this gap is even wider. Women there earn around 67 pence to the male pound.
Also, they hold only about one-third of leadership roles, even though they enter the industry in similar numbers. Moreover, ACT’s data shows that women’s representation among top earners has declined since the pandemic.
All of this shows that the industry’s current approach to merit is not working as intended. ACT’s evidence reveals consistent distortions in how performance, readiness, and potential are judged. Our own analysis expands on these patterns and shows how they influence progression, visibility, and innovation inside firms.
Let’s examine where the gaps arise and which measures can realistically close them.
Gender Bias in Finance: Evidence from ACT
The first mechanism runs through evaluation. Financial institutions rely heavily on subjective assessments embedded in performance reviews, promotion panels, committee discussions, and informal judgments about “readiness.” This is where bias becomes most potent.
Across the ACT experiment, two candidates delivering identical financial decisions were assessed differently solely based on perceived gender. “Stephen” was consistently rated more competent than “Stephanie” despite identical outcomes. The pattern followed a familiar behavioural logic, implying that men’s success was attributed to skill; women’s success, by contrast, was partially discounted.
This matters because evaluation defines who gets access to high-stakes meetings, stretch assignments, and senior visibility. ACT shows that these decisions often follow ingrained assumptions about male competence. When two identical profiles receive different assessments, it means that even stronger performance on the woman’s side might not change the outcome.
External cases point in the same direction. For example, in 2018, Tokyo Medical University admitted that it had been lowering women’s entrance exam scores for years to enroll more men. The scandal demonstrated how deeply such norms can sit inside institutions that claim to rely on merit.
The same mechanisms appear in finance. Small distortions in evaluation compound over time and determine who receives opportunities and who remains overlooked. As these patterns persist, firms end up with narrower talent pools, weaker decision diversity, and reduced long-term competitiveness.
Promotion Gaps and the Missing Middle in Finance
The most significant leak is not at the entry level. It appears at the move into management. This “broken rung” shapes the rest of the leadership pipeline.
Limited Advocacy
Many women take on work above their grade, yet they are still not marked as “ready” for promotion. One of the core reasons is that men are far more likely to have several senior advocates. These advocates speak for them and keep their names circulating across the organisation.
Women rarely receive this kind of support, so their achievements remain visible mainly within their teams and do not translate into the visibility needed for promotion.
Visibility Bias
Visibility is another structural barrier. In many front-office and dealmaking teams, women’s input is overshadowed by louder or more assertive colleagues. When they present ideas with confidence, they are more likely to be labelled as “bossy” or “difficult.” The same behaviour in men is viewed as leadership.
These double standards shape perceptions of readiness long before formal reviews begin.
Caregiving Load & Unpaid Labour
Caregiving expectations deepen these gaps. In most households, unpaid labour still falls primarily on women due to long-standing social norms. The industry’s “always-on” culture penalises those who carry this load.
Flexible work becomes a career risk because physical presence is still treated as a signal of commitment. Therefore, true equal opportunity requires systems that recognise unpaid labour and allow women to build careers and progress on equal terms.
Taken together, these structural levers create a systematic misallocation of talent. When early promotion gates are misaligned, the leadership pipeline narrows long before performance has the chance to differentiate individuals on merit.
How Gender Bias Hurts Productivity and Innovation
Once women make up roughly 30% of senior management in high-growth sectors, firm-level innovation, valuation, and resilience increase. ACT’s analysis uses robust methods to isolate the effect of gender diversity itself.
This threshold matters because inclusive leadership changes the information environment inside organisations.
In non-inclusive cultures, employees rationally choose silence or conformity. Speaking up carries perceived career risk, particularly when dissent is punished informally or when managers tolerate dominance behaviours. As a result, the organisation loses the insights that could improve products, challenge flawed assumptions, or flag early warnings about risk.
In inclusive cultures, the “cost” of speaking up decreases. Employees offer more ideas, share early signals, and challenge consensus. This creates a wider decision surface and improves the firm’s ability to anticipate volatility.
From a financial perspective, gender bias is inefficient. It suppresses innovation capacity, reduces solution diversity, and narrows the organisation’s field of vision. A culture that distorts attribution or suppresses voice reduces the quality of decisions, mostly in areas where rapid judgment is essential.
Fixing Gender Bias in Finance
The ACT programme identifies dozens of levers, but they cluster around three system-level interventions that consistently move outcomes.
Decision-making architecture redesign
Firms that improve gender outcomes redesign the processes through which decisions are made. This includes:
structured meeting formats that prevent dominance and ensure equal airtime;
protocols that separate outcome from attribution in performance discussions;
transparent allocation mechanisms for high-visibility projects;
evaluation templates that focus on observable behaviours;
When these changes are implemented, the system relies less on informal impressions and more on measurable actions.
Career trajectories reconstruction
Career breaks, transitions, and lateral moves should not derail progression. Strong on- and off-ramp programmes, clear role expectations, and formal mentorship pathways allow firms to retain and re-accelerate talent.
For example, at Drofa Comms, returning employees go through a structured re-entry process rather than an informal restart. We assign a dedicated mentor to help the employee reintegrate after parental leave, update them on internal changes, and provide targeted retraining where needed.
Our employees can also use partial-work arrangements during or after their leave. This reduces the career penalty often associated with caregiving periods.
Crucially, advocacy must be deliberate, tracked, and tied to managerial accountability. Without structural incentives, advocacy defaults to affinity, and the latter reproduces the status quo.
Rewiring leadership incentives
Managers respond to incentives. That means when bonuses, promotion criteria, and leadership assessments incorporate inclusive leadership metrics, behaviour changes occur. Typically, these metrics include equitable distribution of opportunities, team development outcomes, or reduction in biased feedback.
Inclusive leadership is a competence that directly affects team performance and retention. When leaders are evaluated on team advancement patterns, the organisation finally aligns performance management with meritocracy.
Conclusion: Turning Finance into a Real Meritocracy
The combined evidence from ACT shows that finance does not suffer from a shortage of capable people. Instead, it suffers from a system that allocates talent unevenly. Evaluation bias, limited advocacy, visibility distortions, and caregiving penalties all shape who advances and who is sidelined. The next question for firms is whether they treat these findings as a compliance obligation or as a competitiveness imperative.
At Drofa Comms, we believe real requires systems built on data, transparency, and consistent leadership behaviour. Companies that continue to rely on informal impressions or narrative claims of meritocracy will face growing pressure. Those that redesign their systems deliberately will build stronger teams, make better decisions, and grow faster in the long run.
After all, meritocracy is an operating model. And the firms that treat it as such will outpace those that assume it already exists.
Financial services have long believed that performance speaks for itself. In theory, talent is recognised, ambition is rewarded, and strong ideas rise. Yet four years of data from the Accelerating Change Together (ACT) programme show a different reality.
Women in UK financial services earn just 78 pence for every £1 earned by men. The 22% pay gap is almost double the national average. In investment banking, this gap is even wider. Women there earn around 67 pence to the male pound.
Also, they hold only about one-third of leadership roles, even though they enter the industry in similar numbers. Moreover, ACT’s data shows that women’s representation among top earners has declined since the pandemic.
All of this shows that the industry’s current approach to merit is not working as intended. ACT’s evidence reveals consistent distortions in how performance, readiness, and potential are judged. Our own analysis expands on these patterns and shows how they influence progression, visibility, and innovation inside firms.
Let’s examine where the gaps arise and which measures can realistically close them.
Gender Bias in Finance: Evidence from ACT
The first mechanism runs through evaluation. Financial institutions rely heavily on subjective assessments embedded in performance reviews, promotion panels, committee discussions, and informal judgments about “readiness.” This is where bias becomes most potent.
Across the ACT experiment, two candidates delivering identical financial decisions were assessed differently solely based on perceived gender. “Stephen” was consistently rated more competent than “Stephanie” despite identical outcomes. The pattern followed a familiar behavioural logic, implying that men’s success was attributed to skill; women’s success, by contrast, was partially discounted.
This matters because evaluation defines who gets access to high-stakes meetings, stretch assignments, and senior visibility. ACT shows that these decisions often follow ingrained assumptions about male competence. When two identical profiles receive different assessments, it means that even stronger performance on the woman’s side might not change the outcome.
External cases point in the same direction. For example, in 2018, Tokyo Medical University admitted that it had been lowering women’s entrance exam scores for years to enroll more men. The scandal demonstrated how deeply such norms can sit inside institutions that claim to rely on merit.
The same mechanisms appear in finance. Small distortions in evaluation compound over time and determine who receives opportunities and who remains overlooked. As these patterns persist, firms end up with narrower talent pools, weaker decision diversity, and reduced long-term competitiveness.
Promotion Gaps and the Missing Middle in Finance
The most significant leak is not at the entry level. It appears at the move into management. This “broken rung” shapes the rest of the leadership pipeline.
Limited Advocacy
Many women take on work above their grade, yet they are still not marked as “ready” for promotion. One of the core reasons is that men are far more likely to have several senior advocates. These advocates speak for them and keep their names circulating across the organisation.
Women rarely receive this kind of support, so their achievements remain visible mainly within their teams and do not translate into the visibility needed for promotion.
Visibility Bias
Visibility is another structural barrier. In many front-office and dealmaking teams, women’s input is overshadowed by louder or more assertive colleagues. When they present ideas with confidence, they are more likely to be labelled as “bossy” or “difficult.” The same behaviour in men is viewed as leadership.
These double standards shape perceptions of readiness long before formal reviews begin.
Caregiving Load & Unpaid Labour
Caregiving expectations deepen these gaps. In most households, unpaid labour still falls primarily on women due to long-standing social norms. The industry’s “always-on” culture penalises those who carry this load.
Flexible work becomes a career risk because physical presence is still treated as a signal of commitment. Therefore, true equal opportunity requires systems that recognise unpaid labour and allow women to build careers and progress on equal terms.
Taken together, these structural levers create a systematic misallocation of talent. When early promotion gates are misaligned, the leadership pipeline narrows long before performance has the chance to differentiate individuals on merit.
How Gender Bias Hurts Productivity and Innovation
Once women make up roughly 30% of senior management in high-growth sectors, firm-level innovation, valuation, and resilience increase. ACT’s analysis uses robust methods to isolate the effect of gender diversity itself.
This threshold matters because inclusive leadership changes the information environment inside organisations.
In non-inclusive cultures, employees rationally choose silence or conformity. Speaking up carries perceived career risk, particularly when dissent is punished informally or when managers tolerate dominance behaviours. As a result, the organisation loses the insights that could improve products, challenge flawed assumptions, or flag early warnings about risk.
In inclusive cultures, the “cost” of speaking up decreases. Employees offer more ideas, share early signals, and challenge consensus. This creates a wider decision surface and improves the firm’s ability to anticipate volatility.
From a financial perspective, gender bias is inefficient. It suppresses innovation capacity, reduces solution diversity, and narrows the organisation’s field of vision. A culture that distorts attribution or suppresses voice reduces the quality of decisions, mostly in areas where rapid judgment is essential.
Fixing Gender Bias in Finance
The ACT programme identifies dozens of levers, but they cluster around three system-level interventions that consistently move outcomes.
Decision-making architecture redesign
Firms that improve gender outcomes redesign the processes through which decisions are made. This includes:
structured meeting formats that prevent dominance and ensure equal airtime;
protocols that separate outcome from attribution in performance discussions;
transparent allocation mechanisms for high-visibility projects;
evaluation templates that focus on observable behaviours;
When these changes are implemented, the system relies less on informal impressions and more on measurable actions.
Career trajectories reconstruction
Career breaks, transitions, and lateral moves should not derail progression. Strong on- and off-ramp programmes, clear role expectations, and formal mentorship pathways allow firms to retain and re-accelerate talent.
For example, at Drofa Comms, returning employees go through a structured re-entry process rather than an informal restart. We assign a dedicated mentor to help the employee reintegrate after parental leave, update them on internal changes, and provide targeted retraining where needed.
Our employees can also use partial-work arrangements during or after their leave. This reduces the career penalty often associated with caregiving periods.
Crucially, advocacy must be deliberate, tracked, and tied to managerial accountability. Without structural incentives, advocacy defaults to affinity, and the latter reproduces the status quo.
Rewiring leadership incentives
Managers respond to incentives. That means when bonuses, promotion criteria, and leadership assessments incorporate inclusive leadership metrics, behaviour changes occur. Typically, these metrics include equitable distribution of opportunities, team development outcomes, or reduction in biased feedback.
Inclusive leadership is a competence that directly affects team performance and retention. When leaders are evaluated on team advancement patterns, the organisation finally aligns performance management with meritocracy.
Conclusion: Turning Finance into a Real Meritocracy
The combined evidence from ACT shows that finance does not suffer from a shortage of capable people. Instead, it suffers from a system that allocates talent unevenly. Evaluation bias, limited advocacy, visibility distortions, and caregiving penalties all shape who advances and who is sidelined. The next question for firms is whether they treat these findings as a compliance obligation or as a competitiveness imperative.
At Drofa Comms, we believe real requires systems built on data, transparency, and consistent leadership behaviour. Companies that continue to rely on informal impressions or narrative claims of meritocracy will face growing pressure. Those that redesign their systems deliberately will build stronger teams, make better decisions, and grow faster in the long run.
After all, meritocracy is an operating model. And the firms that treat it as such will outpace those that assume it already exists.
London office
Rise, created by Barclays, 41 Luke St, London EC2A 4DP
Nicosia office
2043, Nikokreontos 29, office 202
DP FINANCE COMM LTD (#13523955) Registered Address: N1 7GU, 20-22 Wenlock Road, London, United Kingdom For Operations In The UK
AGAFIYA CONSULTING LTD (#HE 380737) Registered Address: 2043, Nikokreontos 29, Flat 202, Strovolos, Cyprus For Operations In The EU, LATAM, United Stated Of America And Provision Of Services Worldwide
Drofa © 2024
London office
Rise, created by Barclays, 41 Luke St, London EC2A 4DP
Nicosia office
2043, Nikokreontos 29, office 202
DP FINANCE COMM LTD (#13523955) Registered Address: N1 7GU, 20-22 Wenlock Road, London, United Kingdom For Operations In The UK
AGAFIYA CONSULTING LTD (#HE 380737) Registered Address: 2043, Nikokreontos 29, Flat 202, Strovolos, Cyprus For Operations In The EU, LATAM, United Stated Of America And Provision Of Services Worldwide
Drofa © 2024
London office
Rise, created by Barclays, 41 Luke St, London EC2A 4DP
Nicosia office
2043, Nikokreontos 29, office 202
DP FINANCE COMM LTD (#13523955) Registered Address: N1 7GU, 20-22 Wenlock Road, London, United Kingdom For Operations In The UK
AGAFIYA CONSULTING LTD (#HE 380737) Registered Address: 2043, Nikokreontos 29, Flat 202, Strovolos, Cyprus For Operations In The EU, LATAM, United Stated Of America And Provision Of Services Worldwide
Drofa © 2024
