Women working in financial services in Australia are much less likely to receive unsolicited promotions compared to men. When women do request promotions, however, they are more successful than men in obtaining them. So finds a study that investigates the impact of gender on promotion rates. The study demonstrates that gender influences career progression, with women generally receiving fewer promotions than men, regardless of whether they asked for them or not.

Funded by a Gender Diversity Grant from the Australian National University College of Business and Economics and conducted in partnership with CFA Institute, the study was led by Laura Ryan, head of research at Ardea Investment Management. Based on a 2019 survey of more than 400 Australian financial services’ employees—33.5% of whom identified as female—the study examines three key questions about promotions, including the frequency of asking for, receiving, and being offered promotions without asking.

The study controls for factors such as education, years of experience, career breaks, and job function. It finds that men benefited from unsolicited promotions, contributing to men having a compounded financial advantage over women.

“Our study confirms that males benefit from a bifurcated promotion process, in which ‘gifted advancement’ (i.e., promotion without prior request of the employee) is a significant contributor to males receiving a compounded financial advantage over females as a direct result of the latter’s less frequent promotion,” Ryan says. “The study helps understand the under-representation of women in top financial roles globally, where women hold only 11% of chief positions in investment management,” according to co-author Cassandra Crowe, CFA, vice president, at T. Rowe Price Group.

Previous research has suggested various reasons for gender disparity in promotions, which include a lack of female talent, women being too agreeable, and career breaks for family commitments. This study considers the possibility of systemic discrimination and bias. It finds that, despite women often receiving high performance ratings, they are less likely to be seen as having high potential, which could explain their lower rates of promotion.

The impact of career breaks on promotions is addressed in the study. It finds that nearly half of women and more than one-third of men in the survey had taken career breaks. Men who took career breaks, however, were more likely to ask for promotions afterward compared to women, who, despite being slightly more successful than men in getting promotions when they requested them, were less likely to ask.

The study challenges the idea that women are less successful due to perceptions of being too agreeable and not asking for promotions. Instead, it highlights the importance of unsolicited promotions in creating gender disparities in career advancement. And it calls for the development of standardized corporate promotion policies to address systemic bias in the Australian finance industry.

Sarah Maynard, ASIP, global senior head, DEI, at CFA Institute, noted that its Diversity, Equity, and Inclusion Code has been designed to support the investment industry in developing equitable processes. CFA Institute aims to work with Australian investment leaders to adapt and implement the code to reduce inequities in the financial services sector.