The world of finance and lending has never been particularly welcoming to women looking to rise through the ranks and lead large financial institutions. According to Mckinsey, less than a third of SVP and C-suite positions in financial institutions are held by women, despite women accounting for 53% of entry-level finance positions. Deloitte puts that figure even lower, with just 24% of leadership positions held by women and just 9% of leadership roles.
These numbers are stark and clearly indicate that this industry is not tapping into the creative minds and diverse experiences that could help us deliver better products and services. Because many women start in entry-level positions and do not progress to leadership, there is a loss of institutional knowledge, front-line experience, and untapped potential. There is a solution. If companies nurture and nurture talent, this untapped potential can lead to institutional change, and there is a strong business case for doing so. The best companies know this. Eighty-four percent of Fortune 500 companies and 100% of Fortune 50 companies have formal mentorship programs. Companies with mentorship programs are more profitable and experience less turnover than those without similar programs. Additionally, female-led businesses in 2020 have weathered the pandemic and economic downturn better than male-led ones.
Creating an effective mentorship program doesn’t have to be complicated or time-consuming, but it does require commitment. Below are some considerations for implementing a mentoring program.
1. Your investment will pay dividends.
Yes, it’s great to provide people with opportunities, but it also has to make money and meaning, and mentoring programs work on that front. Sixty-seven percent of companies with mentorship programs report an increase in productivity, while 55% say it has had a positive impact on their bottom line.
There are also cost-benefits that do not appear on the balance sheet. Employees with a mentor are much more likely to stay with a company if they participate in a mentorship program. The Wharton School found retention rates to be 72% and 69% for mentees and mentors, respectively. For those who did not participate, retention was only 49%. What is even more compelling is 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 decision-makers, helping them avoid costly mistakes. It stands to reason that employees at all levels can become better and more productive employees with a similar level of leadership.
2. Both mentor and mentee will benefit.
Productive mentoring programs require both mentor and mentee to get something out of the arrangement. Fortunately, most employees who participate in these programs report a high level of engagement and satisfaction.
The benefits for the mentee seem fairly obvious, for example, improving their skills, having a sounding board, increasing their professional network and gaining valuable industry knowledge. The benefits for mentors may be less obvious, but the impact is real. A Coqual report found that participating in a mentorship program helped 57% of mentors improve their own skills, and 43% of mentors came away with a better understanding of their clients.
The key to a successful mentor/mentee relationship is thinking about the match and how the personalities might complement each other. Don’t expect things to click instantly. It is important to plan at least six months of regular interaction to develop trust and rapport.
3. You create a culture, not just a program.
It’s easy to think that mentoring is just another offer in the employee handbook, but the results go much deeper. By creating an environment that provides learning opportunities for mentors/mentees, you will change your company culture in a way that encourages learning and knowledge transfer. A study showed that 90% of employees with a mentor said they were happy at work. Moreover, the majority of mentees who remain in a company accompany others to share the experience. It’s a powerful way to influence change in a company and demonstrate a commitment to helping employees advance their careers.
Ultimately, the case for mentoring is clear. The question is not whether we can afford to do it, but how can we afford not to?
Watch: The Q&A with Kellan Brown
Kellan Brown is vice president of business development and strategic partnerships for Finance of America Reverse and leads the retirement strategies division with a mission to integrate home equity into the financial planning process across the industry. She has spent most of her career coaching and mentoring sales professionals and is passionate about supporting women in leadership positions. Kellan’s career in business development spans over 15 years and in three different industries. She has held various leadership roles generating revenue, building platforms and sales teams, and being a subject matter expert for coaching and mentoring programs across all three companies.