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ECB Board Race Countdown Prompts Diversity Call to Euro Members

Updated on
  • ECB diversity drive can’t substitute for government action
  • Coeure is board member liaising with euro’s member states

Euro-region leaders picking the successors to European Central Bank President Mario Draghi and colleagues in the next year or so should appoint more women in their place, according to Executive Board member Benoit Coeure.

Coeure’s intervention, 18 months before a successor to Draghi takes office, adds the institution’s voice to a call for diversity in its top echelon. The imbalance has long been an embarrassment even in the male-dominated world of central banks.

“We are committed to fostering diversity -- including but not limited to gender diversity -- within our staff,” Coeure, the institution’s official in charge of liaising with euro zone governments, said in Stockholm on Friday. “This cannot substitute for more resolute action by European leaders to appoint more women to our Executive Board and Governing Council.”

Just one of the six policy makers on the current Executive Board -- which is appointed by euro-area governments -- is female. The expiry of four of their terms by the end of next year provides an opportunity to improve this, though a man, former Spanish Finance Minister Luis de Guindos, has already claimed one of those spots.

Lack of Diversity

“Our profession increasingly struggles with a lack of diversity -- something that may also affect public acceptance and, hence, trust,” Coeure said at a Riksbank conference celebrating its 350th anniversary. “In the euro area, only two women are currently members of the Governing Council.”

European governments have shown a clear focus on nationality rather than gender diversity in their nominations to the ECB: since its establishment in 1998, only three women have sat on its Executive Board. The European Parliament has complained frequently about that in the past, and it delayed the appointment of Yves Mersch in 2012 in a symbolic protest.

As Coeure mentioned, gender balance is also severely lacking on the ECB Governing Council, which is made up of the members of the Executive Board and the chiefs of the 19 euro-area central banks. Only one such institution in the region -- in Cyprus -- is led by a woman.

Recent opportunities to fix that haven’t changed anything. When Finland appointed Olli Rehn to succeed central bank Governor Erkki Liikanen in July, he was picked from a list of 10 candidates that was exclusively male as not a single woman applied.

Among positions coming due is that of Bank of Spain chief. The government there must announce a governor to replace Luis Maria Linde by June 11.

Draghi has acknowledged that the central bank has its work cut out to develop a staff profile more representative of the wider population and is currently attempting to increase the share of women in influential roles. Just 27 percent of management positions were held by women at the end of 2017, compared to an interim target of 29 percent, and goals for senior management fell short by an even larger margin.

Coeure said measures to increase the number of female managers “can help address the problem closer to its root -- and it will make us a better central bank.”

Read more: ECB Presidency Race Gets Real as Northern Europeans Drop Hints

Diversity isn’t an issue only for the ECB. Only one Group of 20 central bank -- Russia’s -- has a female chief, even if the Federal Reserve was headed by Janet Yellen until the beginning of this year.

Speaking at the same event as Coeure, Bank of England Governor Mark Carney made the case for diversity going beyond gender, saying central banks in the future will need to recruit from a wider range of educational and social backgrounds, moving beyond economics.

“The future of central banking may involve fewer central bankers,” he said.

— With assistance by Piotr Skolimowski, Maria Tadeo, Kati Pohjanpalo, and David Goodman

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