The Culture of the Finance Profession: Evidence from the 2020/2021 American Finance Association Survey
In 2017, the board of AFFECT (the Academic Female Finance Committee) proposed that the AFA carry out a professional culture survey. We launched the Professional Survey of the American Finance Association in collaboration with the National Opinion Research Center (NORC) at the University of Chicago in 2020. Adams and Lowry (2022) use these data to provide an in-depth analysis of how women and men’s experiences differ, how such differences potentially influence the field, and the types of policy interventions that may help improve the culture in academic finance. This report touches on similar themes, but it also provides a bigger picture overview of the culture in finance, including discussions of the academic pipeline and non-academic institutions. It also complements contemporaneous work by Barber et al. (2021) on the impact of Covid on the finance profession.
Some key observations are as follows:
Among individuals working in academic finance, women and men have similar preferences regarding the importance of achievement and self-direction. This suggests that these preferences are unlikely to explain the differential career outcomes by gender. Moreover, it highlights that policy can potentially improve women’s experiences. Workplaces cannot change preferences, but they can change the structure of work and address discrimination.
Women are differentially affected by the structure of work within finance academia: in the workplace women spend similar amounts of time on research, but they may spend more time on teaching and service. At home they spend significantly more time on childcare and significantly less time on leisure.
Women are significantly more likely to experience discrimination, with 61% of women reporting that they have experienced discrimination, compared to 36% of men.
The AFA Professional Code of Conduct emphasizes that financial economists should behave in ways that encourage the free expression and exchange of scientific ideas. Across individuals who have experienced discrimination: 15% believe that their department represses such exchange of ideas, 28% have left a position due to the threat of discrimination or unfair treatment, and 36% have avoided research in a field due to such threats. In sum, discrimination is costly for the field as a whole.
Policies can help address gender differences, but care must be paid to how they are implemented. Among women who had a career interruption, their employer offered an accommodation in 79% of cases, but the accommodation was discouraged approximately one-quarter of the time.
Despite the costs of discrimination to the individual and to the field as a whole, 60% of respondents indicated that authority ‘never’ or ‘rarely’ addressed discrimination.
Men are more likely than women to have a mentor, defined as a senior person they feel comfortable asking for advice: 85% of men report having one mentor and 62% report having more than one. The analogous percentages among women are much lower, at 77% and 46%. Men’ higher likelihood of having a mentor arises from their greater propensity to independently connect with a senior person. When mentors are formally assigned, women and men are equally likely to have a mentor.
While virtual work offers some advantages, survey responses highlight the costs of virtual work across both men and women, in terms of the sharing of ideas: 71% of respondents report that they received fewer or considerably fewer comments during virtual conferences than in-person conferences.
Best Practices to Promote Gender Equality
As part of its mission to promote the advancement of women within finance academics and ensure that success is based on qualifications irrespective of gender, AFFECT recommends the following set of best practices. These recommendations are based on findings of academic research.
The Status of Women in the Finance Profession: Preliminary data from the AFFECT Board 2017
Why AFFECT? Presented at the Meetings of the American Finance Association, 2019.