European Banker of Year Shows Why She’s Lonely at Top

Photographer: Casper Hedberg/Stockholm
SEB AB Chief Executive Officer Annika Falkengren said, “You don’t really realize how lonely you are until you suddenly meet another woman in the same position.”

Annika Falkengren, who heads SEB AB and is the only woman chief executive officer among Sweden’s biggest companies, says one of the world’s most gender-equal nations isn’t doing enough for women in the corporate world.

“It’s important not to glorify Sweden,” Falkengren, 51, said in an interview in the 157-year-old bank’s headquarters overlooking the 18th century cinnamon-brown Royal Palace of Stockholm. “We have so few women at the very top.”

The Nordic country consistently ranks at the top in its efforts to stamp out sex bias, according to the United Nation’s Gender Inequality Index. About 45 percent of elected officials are female, either parent can take more than a year off work with a new baby and “hen” has entered the language as a gender-neutral pronoun. Swedish movie theaters now post sexism ratings.

Still, in a business world led by Ericsson AB and Hennes & Mauritz AB, only 22 percent of senior managers at the 25 biggest companies are women. Falkengren is one of just five female CEOs among Sweden’s top 100 companies. Women on corporate boards total about 24 percent, according to an index by Statistics Sweden measuring 231 publicly traded companies.

In 2005, when Falkengren took charge of Sweden’s fourth-largest bank by market value, she predicted there would be many more women holding top corporate jobs within a decade, she said. Eight years later, she’s still waiting.

Photographer: Casper Hedberg/Stockholm

SEB AB Chief Executive Officer Annika Falkengren speaks during an interview in Stockholm. Close

SEB AB Chief Executive Officer Annika Falkengren speaks during an interview in Stockholm.

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Photographer: Casper Hedberg/Stockholm

SEB AB Chief Executive Officer Annika Falkengren speaks during an interview in Stockholm.

“You don’t really realize how lonely you are until you suddenly meet another woman in the same position,” she said.

Quota Failings

Government quotas that force companies to put more women on boards, such as Norway’s requirement of at least 40 percent and similar measures in Spain and France, aren’t the answer, Falkengren said.

“It is awful to feel that you have been asked to do a job just because there is a quota,” she said. “The threat of quotas is probably needed, but I have a lot of respect for the owners of the capital, and they should be able to decide who sits on that board.”

A 2006 study from Sweden’s Uppsala University compared the earnings of 48 companies and found that those with more female board members delivered higher profits and showed greater potential to increase earnings than companies with no women on their boards. Catalyst, a New York-based research and advocacy group for female executives, has arrived at a similar conclusion for Fortune 500 companies.

Gender bias is still a hurdle for women trying to reach the top, Falkengren said. Her own encounters with sexism came from unexpected places: When she became CEO with a baby at home, she said, reporters repeatedly asked how often she took her daughter to daycare and how much time she had for traditional mothering.

Paternity Leave

When Lars Nyberg, the former CEO of phone company TeliaSonera AB “had two kids below the age of 2, he was never asked that question,” Falkengren said. “I was still getting that question when my daughter was 8.” Former Volvo AB CEO Leif Johansson “was running Volvo with five kids, and he never got the question.”

Under Falkengren, SEB (SEBA) has taken steps to ensure that child-rearing -- which she says is one of the biggest potential setbacks to a woman’s career -- is shared by both parents. By Swedish law, mothers and fathers get a combined 480 days with some pay. Some companies, including SEB, then supplement that compensation. The bank guarantees 80 percent of their current pay for a year after a child is born.

“Since we started offering 80 percent, men to a larger extent now also take paternity leave,” Falkengren said.

Middle Managers

Her daughter, now 9, regularly plays in the corridors of SEB’s executive suite while her mother works. Falkengren’s husband Ulf, who is a senior sales manager at SEB Merchant Banking, mostly takes care of the home front, she said. Falkengren usually travels once or twice every week and often has client meetings in the evenings.

About 40 percent of middle managers at SEB are women, with 30 percent in senior management. Among them is Viveka Hirdman-Ryrberg, who started at SEB in 1990 and is now head of group communications. She’s the only other woman on SEB’s 12-person group executive committee.

Lars Thunell, the bank’s CEO between 1997 and 2005, said Falkengren was his obvious successor.

“Annika has become a symbol that it’s possible to rise on one’s own merits to the highest positions within banking,” he said. “She is known outside banking circles in a way that other CEOs are not.”

Trainee Job

Born in 1962 in Thailand, where her father was a diplomat, Falkengren honed her independence at Sigtunaskolan Humanistiska Laeroverket, one of three national boarding schools in Sweden.

After graduating from Stockholm University with a Bachelor of Science in economics in 1987, she got a trainee job at SEB. She’s never worked anywhere else.

Falkengren has experienced the bank -- founded by the Wallenberg dynasty of financiers -- from inside a branch office to its trading floor and up through its management. She became global head of fixed income in 1995, global head of trading in 1997 and head of the merchant banking unit in 2000. She said a firm will do better if it draws on both men and women for key roles.

An obsession with numbers means Falkengren favors workplace causes that make economic sense, she said. She worked her way to the top by sticking to jobs in which results could be measured numerically, she said.

“One thing that suited me was that every day you had your profit and loss account and, almost always, I earned the most,” Falkengren said. “After a few years, I felt that ‘I can do this pretty well compared with all these guys.’”

Soaring Shares

Falkengren uses this example when she speaks to women looking for career advice. “Getting a line job and a P&L is very important because it’s so measurable,” she said. “It’s not a soft thing that’s difficult to judge.”

Shares in SEB have soared 44 percent in the past 12 months, triple the 14 percent gain in the 44-member Bloomberg European Banks and Financial Services Index. Since Falkengren became CEO in November 2005, SEB shares have gone up 1 percent, compared with a 55 percent slump in Bloomberg’s European banks index.

SEB, like Swedbank AB, suffered when its Baltic operations were hit by that region’s imploding property market in 2009. Yet SEB managed to limit group level losses to one quarter after Falkengren scaled back business there. Swedbank suffered group losses in all quarters of 2009. SEB, which focuses on corporate banking, is now one of Europe’s best-capitalized lenders, with core Tier 1 reserves equivalent to 17.4 percent of risk-weighted assets at the end of September.

Financial Crisis

The Frankfurt-based Group of 20 + 1, an association of financial journalists, named Falkengren the 2012 European Banker of the Year, the first Scandinavian to receive the title and the first woman to win since 1998. Previous laureates include former European Central Bank President Jean-Claude Trichet and former Deutsche Bank AG CEO Josef Ackermann.

“Annika’s exceptional leadership particularly came to light as signs of pending European financial crisis” emerged, said David de Rothschild, chairman of Rothschild Group, when he presented Falkengren with the award in Frankfurt in November. “As a result, today the bank is ranked No. 1 for large corporate clients in the Nordic region.”

Perfect Woman

In Sweden, where a generous welfare system is paid for by the world’s highest tax burden after Denmark, Falkengren said the stereotype of the woman who has it all is more a hindrance than an inspiration. She cautions against aiming for a job like hers without making sacrifices.

Falkengren, who goes to the gym several times a week, said it’s laughable to suggest that “to be a perfect woman you should make a fantastic career, have many children, run in the Olympics, take care of your grandparents, of course also clean your house, buy your food, be a fantastic cook and also be a beautiful and fantastic wife.”

Women need to be realistic in understanding what a top managerial role entails, she said.

“My life is so filled with the bank,” she said. “I live my work a lot and really enjoy it.”

To contact the reporter on this story: Niklas Magnusson in Stockholm at nmagnusson1@bloomberg.net

To contact the editors responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net; Frank Connelly at fconnelly@bloomberg.net

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