Women Leadership Advocate Schwartz Named to Aussie Central BankBy
Schwartz to replace Ridout in five-year term starting February
Women’s leadership advocate has property, retail background
Carol Schwartz, a high-profile advocate of women’s leadership named to the Reserve Bank of Australia’s board on Friday, describes herself as “a dove with a hawk’s wings” when it comes to prioritizing economic growth and inflation.
“It’s a balance, isn’t it,” Schwartz said in an interview Friday. “You have to be very careful about growth, you always have to have an eye for growth. But at the same time, obviously, inflation has an impact that one has to be incredibly aware of.”
Schwartz, with a background in property and retail, will commence a five-year term from mid-February and replaces fellow businesswoman and economist Heather Ridout. Schwartz has previously served as a non-executive director of the Bank of Melbourne, the chair of Industry Superannuation Property Trust and as national president of the Property Council of Australia. Three of the RBA’s nine board members are women.
Ridout, a self-described dove who leaned toward growth over fighting inflation, sat on the board as the central bank intensified an easing cycle to combat the unwinding of mining investment that was dragging on the economy. Treasurer Scott Morrison acknowledged Ridout in a statement announcing Schwartz’s appointment, saying the outgoing board member had made an important contribution “through a challenging period.”
The RBA cut its benchmark interest rate from 4.75 percent in late 2011 to a record low 1.5 percent in August as it sought to boost service industries to take over from mining. Governor Philip Lowe and his board have since stood pat, even as inflation remained weak, citing contained unemployment and the risk of further inflating Sydney and Melbourne property markets.
Schwartz said the real estate industry must always be “vigilant” about the outlook: “Looking out for signs of overheating as well as looking out for signs of great opportunity. The property market always has pockets of opportunity, but at the same time one needs to be aware of those areas where things may be overheating and take a step backwards.”
Schwartz, who will formally join the board on Feb. 14, faces an economy that had been showing solid growth before a shock contraction last quarter. Most observers expect a rebound, underpinned by rising commodity exports and residential construction. But the RBA is likely to be less central to the economic debate going forward because of its diminished rate ammunition and reluctance to ease further and risk financial stability.
“The economy is patchy,” Schwartz said, when asked for her take on it. “As it always is. You’ve always got areas that are doing well and areas that aren’t doing so well, and periods of time even in one year, particularly in retail where you might have several good months and then unexpectedly several bad months. And there are a lot of factors that impact on that.”
Schwartz also has a background in philanthropy. She is a foundation chair of the Women’s Leadership Institute Australia and the chair of Our Community, a social enterprise supporting community organizations. Her current directorships include Stockland, Qualitas Property Partners and Trawalla Group.
Schwartz said she also has significant experience in small-to-medium-sized businesses, both at an operating and investing level, as well as a “passionate” involvement with the arts.
“I have a lot of diverse interests,” she said. “I’ve been around now for quite a long time and been able to work in a lot of these different areas in a lot of different capacities.”