A woman will serve as chief executive officer at one of the five biggest U.S. banks before the nation gets its first female president, said U.S. Senator Kirsten Gillibrand.
While no woman is still in the running for president this year, “there are women at mid-level banks already,” Gillibrand said in an interview yesterday, referring to KeyCorp CEO Beth Mooney as an example. Gillibrand spoke at a mentoring event at Radio City Music Hall in New York designed to develop and promote leadership by women in business and politics.
Banks have a small pool of candidates to draw upon if they’re planning to promote a woman from their own ranks. Only four women are listed among more than 30 named executive officers at the six largest U.S. banks -- JPMorgan Chase & Co. (JPM), Bank of America Corp. (BAC), Citigroup Inc. (C), Wells Fargo & Co. (WFC), Goldman Sachs Group Inc. (GS) and Morgan Stanley. (MS) Two of those women are at New York-based JPMorgan, the biggest U.S. lender.
“It’s a longshot because there are not very many senior women left in investment banking,” said Jeanne Branthover, a managing director and head of the global financial services practice at New York-based Boyden Global Executive Search Ltd. “How long will it take to hire them, fit them into your culture, see them succeed and promote them?”
Gillibrand, a 45-year-old Democrat, joined executives from Citigroup, Delta Air Lines Inc. and International Business Machines Corp. (IBM) who participated in the program, which matched senior employees from Wall Street and other industries as mentors for junior women workers.
The event, organized by the Partnership for New York City and the Council of Urban Professionals, drew about 100 attendees. They included Bank of New York Mellon Corp. Vice Chairman Karen Peetz, who said she hopes women will soon lead the biggest lenders as well as the nation.
“You have to be able to see that there’s a pipeline in order to imagine that is going to happen, and I think there are pipelines in both,” Peetz said. “Everybody’s working on it.” As for the current scarcity of women at top levels, “I don’t think it’s some sinister plot,” she said.
Mooney, 56, the KeyCorp (KEY) executive cited by Gillibrand, last year became the first female CEO among the 20 largest independent U.S. banks. The Cleveland-based company ranked as Ohio’s second-largest lender.
Women account for 18 percent of executive officers in the finance and insurance industries, according to a 2011 Catalyst Inc. census that analyzed data on females in upper management at Fortune 500 companies. They held 18 percent of director seats in the finance and insurance industries, according to Catalyst, a New York-based non-profit group that expands opportunities for women and business.
Seats of Power
By contrast, they hold 17 percent of the seats in Congress -- including 17 of the 100 Senate seats -- and six of the 50 governorships, according to data compiled by Off the Sidelines. Gillibrand started that program in 2011 to spur women to “make a difference in their community” by becoming part of decision- making in government and politics.
Since 1984, when Geraldine Ferraro became the first woman to run as a vice-presidential candidate for the Democrats, Sarah Palin has been the only other woman whose name has appeared on a presidential election ticket for the two major parties, serving as the 2008 Republican vice-presidential nominee.
Peetz, listed as 56 years old in her company’s annual report, was named 2011’s most powerful woman in banking by American Banker. She is her company’s first female vice chairman, overseeing the financial markets and treasury services group within the world’s largest custody bank. In addition to serving on BNY Mellon’s executive committee, Peetz is head of the firm’s Women’s Initiatives Network, described as a global resource for the professional development and advancement of women at BNY Mellon with 50 chapters globally.
“Because we’ve all bought into this concept of diversity of thought, I think most every Fortune 500 board and executive group want more diversity,” Peetz said. “We have to start earlier with getting people to have the requisite skills to sit at that level.”
Including women as leaders yields better results for shareholders, according to some academic studies. Companies with three or more women board members in at least four of five years outperformed companies without women by 46 percent, according to a 2011 Catalyst study that measured return on equity.
“When women are at the table, they problem-solve differently, they see risk differently, they see success differently,” Gillibrand said. “They define a different set of parameters, which when heard alongside male voices, result in a better outcome.”
That doesn’t necessarily translate into better pay for women. Male chief financial officers at U.S. companies are paid an average of 16 percent more than their female counterparts of similar age at companies with comparable market values, according to a report by New York-based GMI Ratings, a corporate governance research firm. The study was based on an analysis of more than 1,900 CFOs.
If women received equal pay in all industries, “we could raise the GDP by up to 9 percent,” Gillibrand said, referring to the U.S. gross domestic product. “We need to focus on how do we create more economic opportunity for women?”
The U.S. ranks fourth in the world for the amount of board seats held by women with 16 percent, according to a March study by Catalyst. Norway is first with 40 percent, followed by Sweden and Finland with 27 percent and 25 percent.
Countries in Europe are adopting quotas to put women in directors’ seats. Norway started the push in 2002 and reached its 40 percent mandate. Spain set a 40 percent goal in 2007 with a target year of 2015. France in 2011 required 40 percent female boards by 2016.
“Most boards are thinking about diversity, most executive teams are thinking about diversity, so the ball is already rolling,” Peetz said. “There is definitely a momentum that I haven’t seen before.”
To contact the reporter on this story: Laura Marcinek in New York at firstname.lastname@example.org.