As recently as two decades ago, the world had a very fixed impression of the finance industry.
You were either a suspender clad wall street trader or a pinstripe suited British banker type. There wasn’t much beyond this fashion dichotomy.
From the 1970s onwards, the landscape had considerably changed. This phenomenon was driven first by the rise of serial entrepreneurs like Freddie Laker and Sir Richard Branson, who shunned the traditional dress codes of business. The dot com millionaire further cemented this new look; disregarding more or less every business convention.
Fast forward to the 21st century and it seems that “clothes maketh the man (or woman)” has become the hallmark of the finance world.
In some ways, dressing has become more of a science than ever before.
Clinical psychologist Dr. Jennifer Baumgartner has become the leading exponent of the subject, having authored a book called “You Are What You Wear: What Your Clothes Reveal About You”
Speaking to Forbes, she said: ““When you don’t have a specific system, people come up with their own. It’s what helps you figure out where you fit in. Especially now, with the economy, with people losing status, maintaining a sense of who we are becomes even more important. Our clothes help place us where we think we want to be. ”
Researchers in the US have also found a link between the perception of clothes and your personal psyche.
Hajo Adam and Adam Galinsky from Northwestern University uncovered a phenomenon they have called “enclothed cognition”, which argues that the outfits we wear have an effect on our thought patterns and behaviours.
Their research focused on a series of attention driven tests and tasks being carried out by three groups. One in what they were told were doctor’s lab coats, one in what they were told were painters smocks and one in their ordinary clothes.
In all cases, those who believed they were wearing doctor’s coats fared better in the tests, and in one case where the participants took a Stroop test (when a colour is printed in another colour ink; e.g red in pink ink), the “doctors” made half as many mistakes as the other groups.
Clothes appear to be extremely important about what they say about you both to the outside world as well as to yourself. This is why different areas of the industry have developed certain uniforms, to give themselves an identity.
And while fashion sensibilities have evolved for certain sectors, other sectors have experienced enduring fashion tastes. For example, the Start-up look has been steadily taking hold of venture capitalists for the past decade.
The start-up look was caused by the advent of Venture Capital and Silicon Valley start-up culture, usually made up of college graduates with a penchant for dressing down.
The informal dressing not only conveyed their rejection of traditional business conventions and their key proposition of technological disruption but also emphasized their desire to be viewed in terms of business substance, rather than fashion style.
Now, the Venture Capitalists who chase and deal with these founders have adopted the adage, “if you can’t beat them, join them.” It’s not uncommon to see million dollar investments being concluded by two men wearing shorts and t-shirts.
If VC’s are the ultimate casual dressers, then Private Equity firms are the smart casual of the industry, perhaps driven by the first generation of business casual from the first dot com era.
The uniform is shirts with no tie. Jackets are optional but tend to be more on the sports jacket side. Smart but not formal dresses hold sway over power suits. Both men and women might also wear jeans and sneakers, but they will always have a pair of shoes in the office.
What they are trying to say is that they are approachable, flexible and open. They are not stuffy money people who are here to intimidate CEOs, rather they are your friend and will help in any way they can.
Once you veer away from the world of private finance, you start to get into the traditional world of the pinstripe. This is the one area where rigid dress conventions have remained in place in the face of fashion change.
Suits – preferably pinstripe but always powerful and dark – are the standard issue uniform here. Shirts and blouses are monochromatic and shoes are available in any colour you like, except black.
Decades ago, hierarchy was defined by the type of suit you wore (pinstripe was deemed junior as accountants originally wore this to represent their spreadsheets, darker flatter single colour suits were the preserve of senior staff) but now your status is defined by the quality of your suit and the cost of your accessories.
The image being portrayed here is obvious, exuding power, status, trust and establishment. You mean business if you wear a mean suit. It signifies a seriousness about a role in the money industry that is all consuming.
That, presumably, is what the money business is supposed to be about.