When it comes to diverse hiring, the banking industry is seeing its fair share of challenges. According to a new survey, bank board members are claiming their banks are seeing a lack of women in leadership positions—and they’re also struggling to recruit tech-savvy workers, of all ages and for all positions.
Seventy-seven percent of the directors, chief executive officers (CEOs), and senior executives responding to Bank Director’s 2018 Compensation Survey have at least one female director—up from two-thirds 1 year ago.
However, in a reflection of the broader corporate landscape, bank boards still have a lot of progress to make when it comes to representing diverse backgrounds. Just 14% of survey participants indicate that their board has three or more female members, and given the median size of a bank board, at 10 members, one female director isn’t an adequate representation of gender diversity.
Further, boards still struggle to represent diverse ethnic backgrounds—77% report that their board doesn’t have a single ethnically diverse member—as well as viewpoints from younger generations, with just 16% reporting they have at least one director aged 40 years old or younger.
The 2018 Compensation Survey was conducted in March and April 2018, and surveyed more than 200 CEOs, Human Resources officers, senior executives, and board members of both public and privately held U.S. banks to examine the talent challenges faced by the banking industry. The survey also incorporates data collected from proxy statements to reveal how—and how much—CEOs, directors, and chairmen were compensated in fiscal year 2017.
Additional findings include:
- Fifty-five percent of respondents say that developing a board succession plan is a top challenge related to board composition, followed by the recruitment of tech-savvy directors, at 44%.
- Commercial lenders remain in high demand across the industry, cited by 68% of respondents as an area where they expect to actively recruit employees in 2018, followed by technology, at 38%.
- Forty-seven percent indicate their bank has increased salaries over the past 3 years to attract younger talent.
- The median CEO salary in FY 2017 was $370,232, with total compensation at $621,000. The median age of a bank CEO is 58.
- Fifty-one percent most recently increased director compensation in 2017 or 2018, and one-quarter raised director pay in 2016.
- Seventy percent of nonexecutive chairmen and outside directors receive a meeting fee, at a median of $1,000 per board meeting in FY 2017. More than three-quarters of nonexecutive chairmen, and 71% of outside directors, receive an annual retainer, at a median of $35,000 and $24,000, respectively.
For more information, or to view the full survey findings, click here.