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Cover feature: How big is the mortgage diversity problem?


By failing to reflect the diversity of the market it serves, is the financial services sector letting down its customers and potential recruits?

Had you walked into the office of any mortgage firm 30 years ago, the chances are you would have been greeted by a sea of smartly dressed, middle-aged white men.

Fast-forward to today’s mortgage market and, depending on whose office door you open, the scene may not have changed. The stereotypical image of a mortgage professional has barely altered over the years, in either perception or practice.

But is this lack of diversity starting to hinder market growth, with both lenders and brokers at risk of becoming out of touch with borrowers?

Changing times

The average UK citizen is 40 years old, according to the Office for National Statistics, with 51 per cent of people being female, 14 per cent being non-white and 1.7 per cent being lesbian, gay or bisexual.

Atom Bank director of retail mortgages Maria Harris says these groups will all need financial advice or help at some point in their life, and “it doesn’t feel like the industry is entirely reflective of the UK population”.

She continues: “Yet, at broker level, there’s a much broader and more diverse range of advisers than I’ve ever seen. Firms are being set up for females only, or in certain communities you have brokerages specialising in Sharia finance.”

However, Harris believes not much has changed at the top end, in senior decision-making roles.

“The people designing the products aren’t always reflective of the population,” she says. “This is the case not just in banks but in networks, estate agents, valuers and conveyancers. We are not seeing the diversity coming through yet.”

Industry consultant Mehrdad Yousefi has observed a big shift in thinking across the industry during his working lifetime. However, he believes there is still an image problem in some quarters, with people reluctant to work in the mortgage market because they assume it is dominated by males.

He says: “The first female bank branch manager in the UK was appointed in 1957, yet by the 1980s very little had changed.

“It was normal to see only one woman in a mortgage industry meeting and it was very rare to see another woman in the room who wasn’t making the tea or taking the minutes.

“Things have progressed considerably since then but we still have some way to go to get meaningful levels of diversity in bank/mortgage leadership roles,” says Yousefi.

Connect for Intermediaries managing director Liz Syms agrees that the industry has made positive strides over the past 10 to 20 years.

“Back in the 1990s, I was Prudential’s first and only female adviser and that certainly would not be the case now. But there’s still further to go,” she says.

“Look at the board composition of almost any financial services company and it is still unusual to see more than the token person who is not a white male.”

Wrong message

Brightstar Financial director of people development Clare Jupp says the industry sometimes sends out the wrong message on diversity.

“There’s been slow improvements across the board,” she says. “But one thing that doesn’t help is when you look at social media and there are photos of events and roundtables and there is still very much an image being portrayed of who is in the sector, with the exclusion of particular groups and people.

“There’s always a predominance of the same sort of people speaking at events – it’s usually males of a particular age and I think the picture is probably a bit distorted.”

Jupp believes the industry could take steps to make itself more representative.

“I try to paint a picture that we are not all white and middle-aged here,” she says.

A lot may have changed in the mortgage sector over the past 20 years – with technology, regulation and so on – but not necessarily with the types of people who work in it.

“The industry has tended to promote from within,” says Harris. “There are several people who are in the same role or have been in similar roles for 20 years-plus. You get what you create.”

She says the credit crisis and subsequent consolidation meant there were few opportunities for people to enter the sector – until recently.

Yousefi agrees that the 2008 credit crisis did not help the sector in terms of diversity.

“Both mortgage lenders and brokers have employed more women in the past 10 years but attracting high-calibre candidates has been mixed, chiefly due to the impact of the financial crisis, which resulted in fewer job opportunities and lower wages,” he says.

“The industry needs to do more to attract bright second- or third-generation immigrants who are well educated and strive to get a job in management in the banking and finance sector.”


More steps are slowly being taken. The Women in Finance Charter was set up in 2016 by the Treasury. It was launched on the back of research undertaken by Jayne-Anne Gadhia, chief executive of Virgin Money. Gadhia found that, in UK financial services, female representation was about 23 per cent on boards but only 14 per cent on executive committees.

Around 122 firms across the financial services have signed the charter so far, pledging to support the progression of women into senior roles. Yousefi is optimistic the charter will bring significant change.

“It would be a shame if the women entering our industry today looked back in another 60 years’ time and found that we were yet to complete that journey,” he says.

Jupp, a strong advocate of the charter, thinks there are not enough signatories to it among mortgage firms.

“I just don’t feel that there’s enough appetite,” she says. “I’ve been really trying to promote it but people just don’t come forward and sign it. Maybe they don’t want to make the commitment, but it’s only aspirational.”

She adds: “You largely still have middle-aged grey males running the show, so the whole time they are running things you wonder how much change we are going to get.”

Setting an example

It is difficult to determine whether the continuing lack of diversity in the mortgage market is the result of firms’ inadvertent prejudices or the industry’s failure to attract a mix of applicants.

However, one corner of the market is helping to shed stereotypes – fintech.

“The new firms coming through are attracting a diverse mix of recruits,” says Harris. “The whole look, feel and attitude of the fintech community are a world away from how the incumbent banks are seen,” she says.

“We talk openly about working environment, our values and how people who join us can make a difference. I know some people think the things we do are quite gimmicky, such as not having a dress code and having table tennis and a beer fridge in our offices. But you need to do things to attract a different set of people. You need a working environment that appeals to them,” she says.

This type of work culture would not suit all firms but there are smaller steps they can take, such as flexible working.

“The working environment is generally becoming more flexible,” says Syms, “This is likely to increase the number of women not only in the workforce but in responsible jobs because it enables them to return to work after having children. Flexible working benefits not just women, however; it also helps the growing number of men who want to spend time with their children or who have interests outside work.”

Jupp suggests it’s time to revisit the UK’s schools and make financial services a more attractive proposition for the younger generation.

“We need to let young people see it is a great industry. Maybe it’s just that there’s not enough people in the pool applying for the jobs.”

She adds: “If you have just a white, middle-aged board, how does it reach out to borrowers and the workforce?

“Our age range is 28-48 years old. We have a director who is 28, and that’s brilliant because he will be much more in touch with the millennials.“

A diverse workforce should be the aspiration of any firm but especially of those in the financial services sector, given the wide-ranging nature of its customers. Although it is not desirable for firms to discriminate between applicants based on their age, gender or ethnicity, they should not feel under pressure to offer positions with the sole aim of creating a more diverse team.

As with most things there needs to be a balance, but every firm can play a part in helping the mortgage sector to better reflect the population it serves.

Diversity increases creativity and innovation

Ishaan Malhi, chief executive officer and founder of online mortgage broker Trussle

The mortgage industry isn’t known for being diverse. I regularly meet people across all areas of the industry and, at 27, I’m often the youngest person in the room.

I’m not sure how much of a problem this is but diversity of age, gender and nationality has been shown to increase creativity and innovation within businesses. Perhaps this is why the mortgage industry has been one of the last areas of finance to experience technological disruption in recent years.

Hiring people with the right culture fit is critically important, especially for a relatively small team where the wrong hire could have a large impact. For us, culture fit is values based: it’s being motivated by helping others, doing right by the customer, being open to new ideas and seeing every day as a learning opportunity. The applicant’s background isn’t something we take into account during the hiring process.

The fact that our team is diverse is more a reflection of the type of people who want to join our open and friendly team.

A complete change of attitude is required

Tulsiani-Raj-2017Raj Tulsiani, chief executive officer of Green Park

The majority of junior staff working in financial services are women, but only one in four of employees who reach a senior role is female. This exposes the industry’s ongoing difficulty in attracting and promoting senior ethnic minority talent.

Green Park undertakes annual research into the gender and ethnic make-up of leadership teams within the FTSE 100. While it does not separate out mortgage companies or brokers, the figures are divided by broad industry sectors, including banking and finance.

Click on image to enlarge

The industry must recognise how crucial it is to address the diversity agenda.

Whether that concerns race, gender, LGBT+ or any minority, recognising the problem is just the beginning. A complete change in attitude is needed for anyone running a business in the 21st century.


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