Women are Making History in Finance—and Strides in Creating Wealth

Published on March 16, 2023

March is Women’s History Month—a perfect time to take stock of the many strides and contributions women have made to the worlds of commerce and finance. Those contributions have sometimes had a worldwide or regional impact, and the strides are often more personal. Either way, there is a lot to celebrate, and much work ahead as women continue to work hard to close the gender pay and wealth gaps.

As we noted in this 2021 Forbes Finance Council article, women have fought and progressed to be able to have credit in their names—but longstanding gender norms in families are still somewhat stagnant, although we see societal progress in that realm as well. That said, finance and investment education for women is on the rise, as are online investment platforms that cater to women:

• Ellevest, a relatively early female finance player, provides an investment platform for women by women
• 100 Women in Finance is dedicated to building a more diverse and gender-equitable finance industry by developing the next generation of female leaders in investment or executive roles in finance
• Female Invest (U.K.) is all about financial education for women
• Marmot Finance (Switzerland), and Alpher (U.K.) are women-centric investment platforms committed to closing the financial gender gap
• Girls Who Invest offers financial education and career training for young women

Can you hear the glass ceilings shattering?

Gains in business

According to statistics from Fundera, women entrepreneurs—including women of color—are becoming a major force in commerce in the United States. One figure that stands out is that there are 114% more women entrepreneurs than there were 20 years ago, among others:

• The US has 12.3 million women-owned businesses, representing 40% of all U.S. businesses
• Women-owned businesses generate $1.8 trillion a year
• Women of color started 64% of new women-owned businesses last year and Latina women-owned businesses grew more than 87%

While these figures show promise for the future, others still show a need for more equitable progress:

• Women only receive 7% of venture funds for their startups
• Female entrepreneurs ask for less in business financing than men—around $35,000 less—and the average loan size is almost $5,000 less than what men receive

Lots of room at the top for women leaders—and lots of success for the companies they lead

As a retirement services firm led by a woman founder and CEO, we want to see more women take on the world of finance. There is so much room for growth in this realm as these statistics bear out:

• Quantic reports that only around 6% of the top public financial institutions have female CEOs, while 55% of human resource officers are women (a more traditional role)
• In investment banking, women hold less than 17% of senior positions
• Only 2% of assets and mutual funds are controlled exclusively by women in the United States
• A study by Deloitte and 100 Women in Finance, about leadership and gender equity in financial services firms, states that the number of women in C-suite roles in North America is expected to rise by about 7% in the next seven years:
  1. In 2021, the proportion of women in leadership roles (within financial services firms surveyed) was 24% and this figure is projected to be 28% by 2030; the study’s authors state this figure is still below parity.
  2. Those leadership roles include positions below the C-suite such as executive and senior vice presidents, division chiefs, and regional managers.

At Next Generation, we are fully behind woman-power in the workplace. Here are two amazing reasons why:

1. Private tech companies led by women achieve 35% higher ROI
2. Among companies in the portfolio of the seed-stage venture firm First Round Capital, those founded by women outperformed companies founded by men by 63%

For centuries, women have been behind great successes; we need look no further than the story of the three “Hidden Figures” behind NASA’s milestone moments to grasp that! And we will continue to push open more envelopes to create more opportunities for women in business. There’s no question that when companies keep their employment doors open to women and create a professional path to leadership, great things can happen. We salute all the women who are out there every day, making a difference for their families, communities, and companies!