A new study reveals that female MBA graduates lag their male counterparts in advancement and compensation from their very first professional jobs, suggesting that a gender bias continues to hang over the business world. For the capital markets sector, these findings act as a reminder that more needs to be done to attract and retain women, says Martha Fell, CEO of Women in Capital Markets.

Nonprofit organization Catalyst, which works to expand opportunities for women in business, released a study on Thursday which compares the experiences of male and female MBAs who graduated from 1996 to 2007 from business schools in Canada, Asia, Europe and the United States. The results are based on a survey of more than 4,000 women and men who graduated from MBA programs and held full-time jobs at the time of the survey.

The study found that although the graduates were on an even playing field – with the same education, talent and aspiration – from entry-level onwards, men earned higher salaries and advanced faster than women.

In particular, men were more likely to start their first post-MBA job in higher positions than women, and had higher starting salaries. On average, women were being paid $4,600 less than men in their first post-MBA job.

Furthermore, after starting their careers from behind, women don’t seem to catch up to men. When comparing individuals at all points in their careers, men were more likely to hold a higher position than women, and experienced higher salary growth post-MBA.

One of the factors contributing to these imbalances is an unconscious bias, according to Christine Silva, director of research at Catalyst and co-author of the study.

“There are some biases in play in terms of what people think that women will want in their careers – assumptions around childcare responsibilities or aspirations, and so on,” says Silva. Often, she explains, women are not asked whether they’d like a promotion, and promotions are based on presumptions rather than qualifications.

Catalyst controlled for different industries in the study to ensure that the findings were not driven by any one industry. About one-fifth of respondents were working in the finance, accounting or real-estate industries, and another 10% worked in insurance.

Evidence of gender imbalance certainly exists in the capital markets sector, according to Martha Fell, CEO of Women in Capital Markets.

“Banking is a very old industry, and predominantly male, as are many industries,” she says. “I can’t imagine that any one industry that has historically been male dominated is faring that much better than the rest.”

Interestingly, Fell notes that women seem to have an easier time advancing in the traditional retail banking segments of the financial services industry than in capital markets.

“The banks have fared much better in those segments, in terms of their representation of women, than they have in their investment banking or wealth management segments,” she says. “And I mean significantly better.”

Fell says key challenges in capital markets include attracting women to the sector, and retaining them.

“Retention is a big problem,” she says. She points out that women are less likely than men to ask their employers for things such as higher salaries, more challenging assignments, or job flexibility to accommodate other elements of their lives such as young children. Instead of asking, women may leave their job for one that offers higher compensation or greater flexibility.

“They take whatever is offered to them, as opposed to asking,” Fell says.

The Catalyst study found that women were penalized for stepping off the traditional career track. The results show that women and men were equally likely to pursue a nontraditional career pathway such as working in the nonprofit, government, or education sectors, being self-employed or working part-time before returning to work full-time at a company or firm. While there was no difference in men’s advancement, salary growth, or career satisfaction regardless of their career paths, women who took nontraditional paths before returning to work full-time at a firm paid a penalty by advancing less than women who stayed on traditional paths post-MBA, and less than men on either path.

The study suggests that more action is needed to address the gender imbalance in the business world, according to Silva. In fact, executives of several major companies surveyed for the study call for organizations to take specific actions, including building in checks and balances against unconscious bias.

@page_break@“Companies need to be putting their attention on it now,” Silva says.

IE