More senior women needed, now

Jan 06 2009 by Nic Paton Print This Article

Much as many Americans wish Barack Obama could ride to their rescue tomorrow rather than having to wait even another fortnight for his inauguration, they may have been better off electing Hillary Clinton to dig themselves out of their economic hole.

That's because, according to new UK research and the views of an influential U.S workplace academic, if more women had been in senior positions in finance and big business, much of the woes of the past year could perhaps have been, if not avoided completely, then certainly lessened.

A poll of business executives by UK consultancy The Aziz Corporation has found that nearly nine out of 10 firmly believe a culture that encouraged and rewarded excessive risk contributed to the financial crisis.

More than eight out of 10 felt this failure to understand the risk that many financial institutions were running was fuelled by a "macho" culture within many City firms, with more than three quarters adding that gender imbalance in the working environment had a significant effect.

Almost half – and a majority of those working in financial services – believed that having more women in senior positions could have prevented some of the excesses.

The poll findings are echoed by Myra White, who teaches managing workplace performance and organisational behaviour at Harvard University and is a regular columnist for Management-Issues.

"Women's more cautious approach to risk-taking is in part due to the fact that women make decisions much more carefully than men," she pointed out.

"They want to consider alternatives and potential problems before they take action. In the male-dominated world of finance and business where the prevailing wisdom has been that you must quickly assess your options and take action, the tendency of women to proceed with caution has hurt their careers," she added.

"The male approach of acting first and thinking later has been heralded as the gold standard. Women who haven't embraced this approach are accused of over thinking problems and ruminating too much. Some authors have even gone so far as to suggest that this tendency to ruminate makes women more susceptible to regrets and depression.

"Now that we are reaping the rewards of the failure of men at the top to ruminate enough and many people are mired in depression and regrets over the state of their finances, it is hoped that women's more measured and cautious approaches will be sought in the financial world," she continued.

"However, it is not clear that this will happen. In some cases, such as in the U.S, men are already rushing forward with solutions and throwing money at the problem without carefully thinking through the consequences of their actions," she concluded.

White is not the only one to argue that, if fewer men had been in charge, we might now be in a shallower hole.

Back in November, an analysis of more than 65,000 people by management consultancy Hudson predicted that the global recession could make it even harder for women to break into the boardroom.

Women, it found, were generally more altruistic, people-oriented, co-operative and open and so better suited to leading modern-day organisations.

Yet these very traits were ones that stopped many women progressing within their organisations.

Professor Khalid Aziz, chairman of the Aziz Corporation, said: "Many commentators have focused on the need for greater regulation of the City, and for improved systems to control risk. Of equal importance is the culture within those firms.

"A little more application of female caution and intuition might do wonders for our major financial institutions," he added.