I agree with Molly, and would add as answer to your question, foxie that there are definitely times when self IDing as female is an advantage. What about the chap who won the women's poetry prize? There was a thread about this a while ago - i am working, so don't have time to find it, but it is there somewhere.
Much of what little money is to be made in the Arts sector comes from prizes and awards, and increasingly these are broken down into groups to encourage under-represented people. This started as a way to broaden the scope of the Arts, so it wouldn't only be the voices of middle class white men who were heard (which is a good thing), but has become more and more exclusionary by restricting entry to increasingly niche sections of society.
Coincidentally (?) the number of LGBTQI+ (add initials as they come onstream) working class, disabled neurodivergent Artists with links to England, Scotland, Ireland and Wales (and numerous regions within) appears to have ballooned. Of course ways should be found to include everyone, but I honestly can't see what someone's 'gender' feelings have to do with their ability to paint, or their self-defined social class has to do with their skill at dancing. By all means have grants to educate those who can't afford it, and make it clear on prospectuses and awards literature that there will be no prejudice (have anonymous entries, for instance), but why have categories that exclude people?
I stress that this has nothing to do with employment EDI monitoring, however. It is (AFAIK) particular to areas such as Art, dance, performance, photography, poetry and so on.