Women in FinanceWomen in finance are less than in STEM

Why So Few Women in Finance?
Studies point to role models, math gender gap, demanding hours and bias

FinLit Talks: Interviews with Financial Literacy Thought Leaders

Annamaria Lusardi of the Global Financial Literacy Excellence Center (GFLEC) interviews Professor Brad Barber about his research on gender representation in the finance industry. Barber presented his findings at a Women in Finance conference last October at George Washington University.

Why So Few Women in Finance?

Quick Summary:

  • Women account for only 18 percent of finance jobs, less than in STEM fields
  • Math gender gap likely affects finance careers
  • Role models are more important to women than men

After navigating the vagaries of Wall Street for more than two decades, alumna May Seeman MBA 89 recently stepped away from her role as president and CEO of MEAG New York, where she managed investment advisory services for Munich Re, the company’s parent firm in Germany.

Seeman is one of a small number of women who have carved a successful career as a leader in finance.

Why are women a minority in investment management across global markets? To uncover the underlying causes of the gender disparity, the Chartered Financial Analyst Institute (CFA) launched an initiative to increase diversity among investment professionals.

The CFA Institute, which today has more than 150,000 members in 165 countries, found that women represent less than one in five CFA members, well below the percentage of female workers around the world.


That surprising number led to a survey and analysis of CFA members that revealed many factors for the lack of women in finance.

To analyze the trends, the CFA Institute turned to Graduate School of Management Professor Brad Barber and his co-authors, Professor Renée Adams at the University of New South Wales and Professor Terrance Odean at UC Berkeley. They’ve since authored a series of papers examining why there are so few women in finance.

“In the more innovative, non-established areas of finance, it does not matter if you are a man or a woman. If you produce good work, you can build a career. Go where you have less competition and less requirements in the form of incumbents. Be involved, be persistent and you’ll have more room to be successful, to grow and shine.” — Alumna May Seeman MA 89, former president and CEO, MEAG New York

In their study and a CFA Institute report, Barber and his co-authors found that specific barriers discourage women from entering the CFA/finance professions. Women face greater time obligations outside of work, for instance, and finance is a profession that disproportionately rewards those who work long and inflexible hours. CFA members who are women express a stronger desire to recapture time from work than male CFA members.

Barber and his co-authors also examined the influence of parents as role models for women entering finance. This helped explain why only 18 percent of the CFA membership is women, while in STEM fields at large women represent 26 percent.

Former Wall Street CEO and alumna May Seeman MBA 89

In a related research study, Barber found that among female CFA Institute members, having a mother who worked in a STEM field raises the probability of a daughter becoming a CFA Institute member by 48 percent more than that of a son. “Our findings are consistent with the hypothesis that early role models, particularly female role models, influence women’s choice of finance careers,” Barber and his co-authors write in “STEM Parents and Women in Finance,” forthcoming in the Financial Analyst Journal.

Despite a rising number of women in STEM fields since the 1970s and more women earning college degrees than men, women still experience a growing wage gap and many other challenges in the workplace.

“When I was born, in 1961, the proportion of women in the workforce was probably half of what it is today. Yet we don’t see women who are participating in all the professions,” says Barber. “Understanding that is one of the more important questions that we face.”


Barber and his colleagues have also connected the proportion of women in finance to the math gender gap, in which boys tend to outperform girls on math tests in the U.S. In their recent paper, “The Math Gender Gap and Women’s Career Outcomes,” they showed that the math education of girls significantly affects their career outcomes as women.

Since this math gap is not across all cultures, it isn’t simply a biological advantage in boys. Earlier studies revealed deeply engrained stereotypes against women when it comes to math, in which men were twice as likely to get hired over a woman with the same proficiencies. Some women are also less attracted to competitive environments, such as those commonly found in finance, and may perform poorly when in groups with men.

The researchers discovered that the math gender gap was one of three mechanisms—including the influence of role models in STEM—that drive the participation of women in CFA professions.


In a society where women still shoulder more obligations at home as mothers and wives, the demanding hours of a career in financing sets a barrier discouraging women from entering the field.

Barber and his colleagues saw the impact of this in the survey data. They found that female CFA members were “less tradition- and conformity-oriented and more achievement-oriented” than both their male counterparts and women in general.  

“I would say generally that men are much more willing to sacrifice family aspects than women,” May Seeman said of the demands of the investment industry. “Extensive traveling is not conducive to family life, and women generally are less inclined to want to be away from home for an extended time.”

For those willing to take less pay to recover those hours, the percentage of women was twice as high as men. Women were also more likely to want more free time when they were married, had children or were older and valued tradition more, according to Barber.

“This suggests that traditional role models are having a big effect on career trajectories,” said Barber.

Male CFA members, however, were willing to work long hours regardless of their family situation or how much they valued tradition.

Seeman, a mother of two, said this is a critical issue to solve, suggesting that firms need to look at job sharing or other ways to offer greater work-life balance to make it easier and more attractive for women to enter the profession.

Women face even more headwinds in the investment management field, where Seeman has succeeded as a CEO, with over $50 billion in assets under her management and a team of 50.


With this research in mind, Barber and his colleagues see hope with mentorship programs for girls and young women. They’re advocating for more support for these programs, as well as more professionals in finance to serve as inspirational mentors for these rising scholars.

Seeman said the tide is changing and Wall Street has taken note as more nonprofit and corporate programs are specifically helping women with internships, career positions and mentorships in finance. She said one program for up-and-coming college undergraduate women who show solid quantitative skills is introducing them to mentoring and placement opportunities in well-known investment firms, such as Blackrock and The Carlyle Group, with great success.

“In finance, there’s opportunity to have much more growth in these sorts of initiatives,” said Barber. “We certainly have many companies that have the resources to fund these types of programs.”

Once that happens, Barber can work on his next research goal: tracking the most efficient approaches for mentoring women as they navigate these hidden hurdles in the world of finance.

Download research studies: