The Case for Mentorship in Financial Services
The world of finance and lending has never been particularly welcoming to women looking to climb the ladder and lead major financial institutions. According to Mckinsey, less than one-third of SVP and C-suite roles at financial institutions are filled by women, despite women making up 53% of entry-level finance positions. Deloitte puts that number even lower, with just 24% of leadership roles filled by women and only 9% in senior leadership positions.
These figures are striking, and a clear sign this industry isn’t tapping into the creative minds and diverse experiences that could help us deliver better products and services. Given many women start in entry-level positions and do not advance into leadership is a loss of institutional knowledge, front-line experience, and untapped potential. There is a solution. If companies mentor and nurture talent, that untapped potential can lead to institutional change, and there is a strong business case for doing so. Thetop companies know this. Eighty-four percent of Fortune 500 and 100% of Fortune 50 companies have formal mentorship programs. Those companies with mentorship programs are more profitable and experience less turnover than those without similar programs. Moreover, those companies with a female CEO in 2020 weathered the pandemic and the economic downturn better than those with a man at the helm.
Creating an effective mentorship program doesn’t have to be complicated or time-consuming, but it does require commitment. Below are a few considerations to implementing a mentorship program.
1. Your investment will yield dividends.
Yes, it’s great to provide opportunity to people, but it also has to make dollars and sense, and mentorship programs deliver on that front. Sixty-seven percent of businesses with mentorship programs report an increase in productivity, while 55% say it has positively impacted their profitability.
There are also cost benefits that don’t appear on the balance sheet. Employees with a mentor are much more likely to stay at a company if they are involved in a mentorship program. The Wharton School found that retention rates were 72% and 69% for mentees and mentors, respectively. For those who didn’t participate, retention was just 49%. Even more compelling was that mentors were promoted six times more often than those not in the program, and mentees were promoted five times more often.
The Harvard Business Review found that CEOs who receive mentorship are better at making decisions, helping them avoid costly mistakes. It stands to reason that employees at all levels can become better, more productive employees with a similar level of guidance.
2. Both the mentor and the mentee will benefit.
Productive mentor programs require the mentor and mentee to get something out of the arrangement. Luckily, most employees who participate in these programs report a high level of engagement and satisfaction.
The benefits to the mentee seem fairly obvious, e.g., improving skills, having a sounding board, increasing one’s professional network, and gaining valuable industry knowledge. The benefits to mentors may be less obvious, but the impact is real. A Coqual report found that involvement in a mentorship program helped 57% of mentors improve their own skillset, and 43% of mentors walked away with a better understanding of their customers.
The key to successful mentor/mentee relationships is to think about the pairing and how the personalities might complement each other. Don’t expect things to click instantly. It’s important to allow at least six months of regular interaction to develop trust and rapport.
3. You’re creating a culture, not just a program.
It’s easy to think of mentorship as just another offering in the employee handbook, but the results go much deeper. In creating an environment that provides mentor/mentee learning opportunities, you’ll change the culture at your company in a way that encourages learning and the passing on of knowledge. One study showed that 90% of employees with a mentor reported being happy at work. Furthermore, the majority of mentees who stay with a company go on to mentor others to share the experience. That’s a powerful way to impact change at a company and demonstrate a commitment to helping employees advance their careers.
In the end, the case for mentorship is clear. The question isn’t can we afford to do this, but how can we afford not to?