Banks Need To Do Better - Building Gender Balanced Business

Ten of the nineteen US banks given the US government stress test in May 2009 are to be given capital to help them through the crisis.

It would have been interesting to see whether the healthier banks have a better gender balance.

The truth is, however, women are under-represented at all 19 banks.

Women represent 20% or slightly more than 20% of the corporate directors in only six banks (four that are receiving capital and two that are not).

GMAC has no women on its board and only 8% of the executive committees at Citigroup, Sun Trust and American Express are made up of women directors.

More than 20% at Wells Fargo
One of the winners of our league table is Wells Fargo with 21% of its board members and 23% of its executive committee made up of women officers.

Clearly, all these banks have a long way to go to develop more women through the pipeline to approach anything near gender balance.

Only five banks have a critical mass of women directors
Only five of them reached a critical mass of three or more women directors: Bank of America, Wells Fargo, PNC Financial Services, BB&T and US Bancorp (Wells Fargo and Bank of America achieved this on both of their boards and executive committees). Without this critical mass, women’s voices are often not heard and therefore their contribution to board discussion and decision-making processes is likely to be limited. This may have harmed the ability of the banks to make the right decisions in the past few years when they failed to analyse properly the risks they were taking.

Most banks have diversity initiatives of one kind of another. The real issues is why, after all the effort and talk, women are still so poorly represented at the top of major banks such as these. And, more to the point, what are they going to do to rectify the problem in the future. The future health of the financial sector might depend on getting the answer to this question and acting on it.