High Ambition, Higher Barriers: New VersaFi Study Exposes the Performance Tax Facing BIPOC Women in Canadian Finance

Study explores the unique burden experienced by BIPOC women in the sector and offers actionable solutions for firms

TORONTO--(BUSINESS WIRE)--A landmark research report from VersaFi, Dismantling the Performance Tax: Strategies to Advance BIPOC Women in Canadian Finance, reveals that despite being among the most ambitious professionals in the sector, BIPOC women face a compounding, invisible surcharge simply to be seen as equally capable, credible, and ready for leadership as their peers. VersaFi research has named this a ‘Performance Tax’, and it operates across four interconnected dimensions of BIPOC women's professional lives. Critically, the data shows that the Performance Tax compounds as seniority increases, with barriers becoming more pronounced, rather than less, the closer BIPOC women get to the top.

Drawing on data and first-person accounts from BIPOC women working across banks, dealers, asset managers and advisory firms, the study highlights that while more than 7 in 10 BIPOC women in finance (71%) aspire to reach the C-suite, ambition has not translated into advancement. Most BIPOC women remain concentrated in much lower-paying roles than both their white women peers and men, and six in 10 (61%) say they have to work harder than others to gain the same level of recognition or advancement.

“Our research shows that BIPOC women in Canadian finance are being held to different standards than their peers, from how their leadership and competence are assessed to their access to sponsorship, influential networks and career-building opportunities,” says Tanya van Biesen, CEO of VersaFi. “This is not an ambition problem but a systemic one, and addressing it requires an intentional and sustained effort. Those institutions and leaders who engage seriously with this work will be better positioned to retain and advance BIPOC women, and to build stronger, more resilient organizations.”

The data highlight that the Performance Tax for BIPOC women operates across four dimensions of their professional experience. These include:

• THE BURDEN OF PROOF: An expectation that BIPOC women must demonstrate competence that peers are “assumed” to possess.
  Almost 7 in 10 (68%) study participants believe BIPOC women in the finance sector are held to a different standard than their peers when it comes to leadership evaluation, and 60% believe they face more scrutiny of their leadership decisions. These figures rise to 82% and 74% respectively, for BIPOC women who are senior leaders (those above middle management).
  
  
• THE RECOGNITION GAP: Contribution is not reliably credited.
  Only half (50%) of study participants say they feel supported by their organisation in advancing to or within senior leadership, and almost half (47%) say colleagues take credit for their work often or always. These figures rise to 6 in 10 (61%) and 58% respectively, for BIPOC women who are senior leaders (those above middle management).
  
  
• THE ACCESS DEFICIT: Exclusion from informal networks and sponsorship opportunities.
  While almost 9 in 10 (88%) study participants believe sponsorship is crucial to reaching a leadership position, almost half (46%) identify a lack of sponsorship from senior leadership as a key barrier. Another 6 in 10 (58%) say they face limited opportunities for high-visibility roles.
  
  
• THE VISIBILITY SHORTFALL: Absence of BIPOC women in senior leadership.
  More than half (52%) of study participants cite a work culture that is non-inclusive as a key barrier to advancement, rising to 61% for BIPOC women in senior positions. A further half (51%) of respondents cite limited representation of BIPOC women in leadership as a key barrier to advancement. The absence of visible representatives leaves fewer sponsors, fewer advocates and fewer signals that advancement is achievable.

ACTIONABLE RECOMMENDATIONS FOR FIRMS ACROSS THE SECTOR

Dismantling the Performance Tax addresses more than the measurement within each dimension. In it, VersaFi urges financial institutions and leaders to leverage these findings as a catalyst for change, and offers five practical recommendations to support, advance and retain BIPOC women:

1. Clarify advancement requirements through measurable success criteria, replacing subjective feedback that disadvantages those without informal access to power.
   
   
2. Standardize contribution credit by establishing clearer mechanisms to recognize individual contributions, particularly on high-profile work where credit can default to the most senior or visible person.
   
   
3. Embed accountability for sponsorship by tracking sponsorship outcomes in senior leader evaluations.
   
   
4. Institutionalize ‘shadowing’ to build exposure to senior decision-making without adding to already stretched workloads.
   
   
5. Redefine leadership archetypes by challenging assumptions about what a leader should look and sound like, and ensuring that leadership potential is assessed based on impact and capability rather than conformity to a traditional executive type.

To download the full report, please visit: Dismantling the Performance Tax: Strategies to Advance BIPOC Women in Canadian Finance.

This research was supported by Women and Gender Equality Canada.

About VersaFi

VersaFi is a national, non-profit organization focused on elevating women in the finance sector to advance prosperity for all. Founded in 1995 as Women in Capital Markets (WCM), the organization rebranded in 2024 as VersaFi.

As Canada’s largest network of women, allies, and leading finance sector organizations, we champion talent at every stage of the career journey: empowering individuals and shaping leaders; transforming individual success into industry-wide impact; and advancing a stronger, more competitive finance sector for all.

Our community has grown to a membership of more than 4,400 and 55+ corporate partners across the country representing the finance sector across banks, dealers, insurance companies, pension plans, regulatory agencies, exchanges, and advisory firms. To learn more or to become a member, visit www.versafi.ca