Federal government an exemplar in promoting women
A funny thing happened on my way up the career ladder in government. As I became more senior, the industry representatives I met with became more male.
As a former chief counsel of the Senate Banking Committee and later, the Office of the Comptroller of the Currency, I recall only a handful of times attending meetings that included C-suite women, among the scores of meetings I had with senior banking officials.
Now as an advisor to innovative financial companies, I see a similar gender bias playing out in the emerging fintech space as women founders struggle to attract investors.
Throughout recent history, most of the federal financial regulators have been led by women, and all these agencies have had women among their most senior ranks.
So why can the government get it right, but the private sector seemingly cannot? And does it really matter?
One difference may lie in motivation. The government — and the professionals who work in it — are not motivated by profit, but by public service. By contrast, many private-sector workplaces in the quest to quickly return value to shareholders, have proven inhospitable to women: to their leadership styles and their lifestyles, particularly those with young children or those returning after an absence.
Even when banks do well in retaining and promoting women, senior-level women are often concentrated in human resources, legal and compliance. And yet, CEOs tend to come from business lines that generate profit for the company.
The government does not have a corollary. Among the banking regulators, there are plenty of examples of women running the agencies, heading up bank examination and policy functions, as well as legal and human resources departments. If women are not experienced in areas that feed the succession pipeline in industry, they will not get equal opportunities to advance.
And that matters greatly. Diversity in decision-making leads to more informed outcomes; customers benefit from it; investors are demanding it; and new laws are beginning to require diversity in boardrooms.
See the latest Most Powerful Women rankings:
It’s difficult to imagine a company consciously choosing to stifle innovation, creativity and profitability by bypassing a large pool of talent within its ranks. Yet this happens regularly, despite good intentions.
Motivated by personal experience, and the depressing data about the number of women in financial services who leave their companies mid-career, I co-founded ALLRISE DC with Sally Miller, the former chief executive of the Institute for International Bankers.
Through ALLRISE DC, we’ve learned there are measures that any organization, including the government, can take to foster women at the mid-career level and beyond.
First, there needs to be an inclusive culture where women can thrive. When women see other women at the top, they understand their voices are valued and hard work is rewarded with opportunities to advance. An inclusive culture that encourages the expression of diverse opinions, and provides a safe environment in which to do so, is a healthier one.
Second, organizations need to develop women leaders by expanding opportunities for them. Support women working in all areas of an organization, but particularly those where women may be underrepresented.
If the succession pipeline for senior leaders is through certain business lines, women need a chance to succeed in these areas. Consider rotations, training, support systems and sponsorships. Alternatively, consider whether indicators of success in an organization are too narrowly drawn and fail to recognize valuable contributions.
Third, organizations should provide for flexible work arrangements, giving women and men greater control over where and how they work, as long as the work gets done. An organization that overtly or covertly frowns on flexible arrangements undermines their effectiveness as a tool to retain talented employees.
Fourth, set measurable targets and goals for promoting women. Diversity objectives should be driven and embraced by senior leadership and not delegated to human resources. There should also be transparency in systems and processes for promotion and pay. Transparency can lead to greater accountability, more equitable treatment and confidence among employees that the organization is fair.
Also, companies need to ferret out unconscious bias in all processes responsible for identifying and developing talent. Unconscious bias can lead even well-intentioned managers to favor those who are most like themselves.
Lastly, there should be a recognition that men are important allies. Men should be encouraged to mentor and sponsor women. Men can help identify women with potential in their ranks and take an active role in their career development. By exposing women to broader networks and championing them in the organization, men can help to create a more inclusive workplace.
Much work remains to be done in promoting women’s leadership in the financial services industry. There is no secret sauce, but a collection of actions can make a difference. And the end result is well worth it in creating workplaces that are more hospitable to women and men alike.
Amy Friend's BankThink post is part of our annual Women in Banking series. Others in the series include the OCC's Maryann Kennedy, the FDIC's Aleas Upton Kea, Citigroup CEO Michael Corbat, and Howard Bank Chairman and CEO Mary Ann Scully.