Wednesday, October 6, 2010

The Lack of Women in Finance - A RANT!!!!!!

Women in Finance is a hot topic these days. (click here from FB) I can barely keep up with the articles talking about the lack of women on the street, pay disparities, lawsuits and more. Here is the most recent from BLOOMBERG filled with great stats:

- Women in Finance earn 63.9 cents for every dollar men made in 2000.
- Same stat for 2001 - 58.8 cents
- Biggest gap in any of the 13 industries surveyed by the Government Accountability Office
- Number of women in finance, banking and insurance in the US fell by 537,000 between the second quarter of 2007 and the second quarter this year
- Citigroup does not have any women on their executive committee - 19 men

The reasons as to " why so few" are many and the research paper "Women in Fund Management: A Roadmap to Critical Mass and Why it Matters" addresses this in detail ( click here ), but her is more of my personal take:

- Pipeline issues - Fewer women then in math, science and business programs. Fewer women choose to enter the field out of undergrad or graduate school. That said, when the environment is perceived as not "women-friendly", no wonder.

- Gender Discrimination and Bias - Wall Street and finance in general is still very much a 'boys club.' Some firms are better then others, but all the major institutions are governed by men and many of them bring their personal biases to work place and for some, bad behavior. When I began on Wall Street strippers still made visits to the trading floor in celebration of someone's birthday, and thank heaven those days are behind us. That said, it is naive to think that men who think that it is fine to stuff hundred dollar bills in g-strings of naked women at night, don't bring some of that to the workplace with them in terms of how they manage, mentor, co-exist with women in the work place. On the other hand I think some women bring too much of their sexuality in to the workplace and I have seen them use it as a tool to get ahead. It is a delicate balance and one that women, more then men, will have to manage. More relevant is the reality that we are more comfortable with, and confident with people that look and act like ourselves. If you are a man, that means men. In a male dominated work place it takes a huge effort to move away from that tendency and needs to be driven by a deep belief that talent comes in both genders, and all colors. Great new book on this - Laura Liswood "The Loudest Duck: Moving Beyond Diversity While Embracing Differences to Achieve Success in the Workplace."

- Problems with Diversity Initiatives and Programs - Despite a lot of good intentions and good programs, too many managers remain ill-equipped to manage a diverse population. Many firms have pages of programs, but the numbers are not changing and it is time to ask why. Too many firms are just checking the box with programs rather than creating accountability for their outcomes. Evaluate. Measure. Rewards positive outcomes.

- Fear of law-suits and the challenge in firing poor performers that are women and minorities. This is a big issue that is not being talked about. It is a chicken and the egg thing. Because there are so few women and minorites, if they end up not being good at their job ( and that may be because of bad management) it is hard to fire them. The are 'saved' as one manager said to me and this creates huge resentment by the manager and the team. The effect might well be that managers who have experienced this become reluctant to hire women and minorities unless they feel they are a "sure thing." It is just easier to fire men if they are not good, so why not hire just them to begin with? Think about this scenerio. You are a guy with good intentions who tries to hire the best talent for his team. Most of the hires are MBASs with no real experience and thus it is all about perceived potential. You have men and women candidates. They look the same. You had the experience with a prior hire, a woman, who proved not to be cut out for the job but despite your efforts to train her and HR would not allow you to fire her. You were told to pour more and more energy in to her success and it just was not working. Sure if she is great you get pats on the back and you have a great team member, but the downside is there. If you just hired the guy and he was great, great! If he did not work out, bye bye. It is at this level that we must think about as it is at the heart of WHY so few women I believe. We have to think hard about the personal and organizational incentives and disincentives around creating a more diverse workforce.

-Maternity Leave - Let's be real. This is a big issue. If you have a desk full of 20-30 year old women, they are going to have babies. As a manager if your employee is out on maternity leave, it means more work for the rest of team, likely without additional compensation. In an industry where all employees are worked to the bone, this is an issue. Again it is about incentives. Firms need to take a big look at this issue.

- Work-life Balance. This will always be more of an issue for women then men. Women have the kids and the pressures to be a 'good mom' are big. This may be the ultimate reason why we don't get to 50/50. That said, I have met PLENTY of women who choose not to have kids, have husbands with more flexibility and so on. This challenge can be addressed institutionally with more flexibility in roles, but the cultural issues remain. Men in finance have to want to be more then the funders of their families for things to really change. They have to want to be great dads in the same way that I think most women want to be great moms. It means being there for more then weekends and family vacations. I KNOW there are some amazing dads out there who are also senior organizational leaders, so this is a generalization. There is a win/win here for all if corporate America cared more about supporting families.

- CULTURE CULTURE CULTURE - First institutionally. I worked at Goldman Sachs for 14 years. Their culture prides itself on being a meritocracy. That belief is core to their being. I had this experience years ago at a management committee/partnerhship committee offsite on diversity. We were in a small group discussion about why so few women and minorities at the firm. At my table were 9 men and myself. I asked them "look around this room filled with our most senior leaders. Do you think this room is 90% white men because they are the best, the brightest, the hardest working?" They answered YES. They truly believed it. It was not long after that I left the firm. These are not bad people, in fact most of them are GREAT people. They do not know what they do not know and most of them walk around in the world as privileged, powerful, white men. ( I walk around as a privileged white woman)Most of them do not experience exclusion or discrimination and because of it they have no frame of reference for it. They are immune. They do not personally experience discrimination so it is easy for them to assume it does not exist. That classic well it did not happen to ME so I guess it does not happen at all. Catalyst did a GREAT report about getting men engaged in diversity initiatives and they said that the men most likely to be diversity champions have experienced BIAS PERSONALLY!!!

Our broader CULTURE. We still live in a world that values men and boys more then women and girls. This is the issue I will work on for the rest of my life. This manifests itself in a million different ways in our homes, in the media, in the workplace and in the world in general. We have focused a lot of energy towards building up girls self-esteem which is awesome. Increasingly the world recognizes the need to get financial resources in the hands of women, especially in the developed world. Again awesome. But.. we have a long way to go. We are talking about power and control and changing the status quo so it will be hard.

Bottom line is this. We all have to care about creating a workplace, a world, where access and opportunity is available for all. We have to digest that the world is not fair, and if we made it to a place of privilege we OWE it to others that they have their shot too. We have to recognize that gender discrimination is everywhere and we have to look for it so we can eliminate it. I believe with all my heart that a more gender balanced world is in the best interest of all. In that world there will be more women leading institutions and more men free to be in the home being amazing husbands and fathers. Men and women are suppose to be in it together.


Terri said...

This is a fantastic post. I haven't seen anyone lay out the issues so well. Thank you!!!!!!!!!!!!!!

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