Not just the pay gap - women experience 'punishment gap' too

Women experience more severe repercussions for misconduct in the financial advisory industry their male counterparts, research published on the Bank of England's staff blog shows.

Women are 20 percent more likely to lose their jobs - and 30 percent less likely to find new employment - following an incident of misconduct compared to men, guest writers Mark Egan, Gregor Matvos and Amit Seru said in a blog post Wednesday. The gap is even wider in firms with few female managers.

"The financial advisory industry is willing to give male advisers a second chance, while female advisers are cast from the industry for similar or less severe missteps," the researchers said. "The effects of the gender punishment gap are costly, long-lasting, and may ultimately contribute to the glass ceiling faced by women in finance."

The academics followed the careers of 1.2 million workers in the U.S. financial advisory industry from 2005 to 2015 and found that the disparity persists throughout one's career. Offenses include customer disputes resulting in a settlement, internal company discipline, and regulatory and criminal offenses.

Men are twice as likely to be repeat offenders and engage in misconduct that is 20 percent more costly, the researchers said, meaning that the so-called punishment gap can't be explained by women's behavior being more expensive for firms. Instead, the composition of companies' management and executives seems to play a role.

At firms with no gender diversity at the executive or ownership level, female advisers are 42 percent more likely to leave their jobs following misconduct than their male colleagues. Firms with more equal representation apply more balanced disciplinary measures.

Ethnic minority men experience a similar disparity in their treatment, the researchers said, and it's again narrower at firms with more multiculturalism in management and executive positions. That suggests the imbalances are driven by "in-group favoritism," the researchers said.