Women in Finance: Bulls, Bears or Babes?

Angela Merkel, German Chancellor; Christine Lagarde, Managing Director of the IMF; Julia Gillard, Australian Prime Minister. All women in power at the peak of a global financial crisis. This comes as Morgan Stanley launch a parity portfolio investing specifically in companies with female board members. The numbers show that their stock price performs better than if the board is composed of all men. A claim also supported by Credit Suisse and several other firms whose female hedge fund managers are outperforming their male counterparts.

But in such a male-dominated arena and at such a crucial time why now this change in trend?

It’s simples: Women understand the global crisis better than men.

Now before all you menfolk chortle at the little woman whilst watching Formula 1 and stroking your fledgling man-beard, stick with me ok?

QUEEN OF THE CALCULATOR

Next week sees the release of several countries CPI reports (ie headline inflation). Inflation is an indicator of fuel, food and energy prices. Items which for years have come under the woman’s remit as keeper of the house and feeder of all, while the male species are out doing the hunter-gatherer bit. A recent interviewee of mine – a prominent businessman – even admitted he couldn’t recall the last time he’d stepped foot in a supermarket. And his home’s last heating bill? Forget about it! When it comes to matters of the home, and more importantly the cost of keeping house, noone has their finger on the pulse more than a woman.

Social history may finally be providing women a well-deserved payback. Years of being CEO of the household mean that in a time of recession, shrinking budgets and higher costs, women simply get it more both in the home and in the boardroom.

HITTING TARGETS

However it’s not all plain sailing, as a UK report released this week indicated that despite an initial surge, there has been a slowdown in the appointment of females to the board’s of FTSE 100 companies, which could mean the missing of two targets:

1. 25% female membership of FTSE 100 boards by 2015, set by a government-commissioned report
2. 40% female non-executive directors by 2020, set by the EU

The Answer? Well according to Vince Cable, it could lay in quotas. While the UK Business Secretary has been quick to emphasise that the government wants companies to take a voluntary approach to these targets, quotas remain “a real possibility.”

“Who cares?” a female acquaintance recently said when discussing female-favourable hiring, “Men have been doing it for years!”  

Of course we want more women in senior positions. But to have the door held open for us simply to appease a quota? All that would do is teach women that it’s ok to be mediocre and could – worse case scenario –  impact UK business performance.

Put women in influential positions within the finance industry yes, but only if they are the right candidates. Correct thinking and leadership are the only way to drag us out of recession and into recovery.

Well that or a money tree..