Wall Street will not see a woman lead a major investment bank anytime soon, judging by the lack of women on bank executive committees of the major firms, say critics.
Only a handful of the executive roles at the major banks are held by women. And the financial industry, typically dominated by men, will continue to be so for the foreseeable future.
“The big question is when we will see a women heading a major Wall Street bank? It’s not happening in the next three to five years,” said Alex Lebenthal, president and CEO of Lebenthal & Company and member of The Committee of 200 (C200), an invitation-only networking organization, composed of female entrepreneurs and corporate leaders.
“I think there are women in the pipeline at different firms, but are they really in the pipeline for front and center roles or just thrown in?” Lebenthal asks.
KeyCorp.’s chairman and CEO, Beth Mooney became the first female to lead a top 20 U.S. bank in 2011. Since then, the list has been lackluster.
J.P. Morgan Chase & Co and Morgan Stanley are two major firms that have a female CFO, but critics say a lot more progress needs to be made to get women in more senior positions on Wall Street.
“Men are promoted based on potential and women are promoted based on experience,” said Maryann Bruce, who has spent more than 30 years on Wall Street and is currently an independent director of MBIA, an independent trustee for Allianz Funds and a member of C200.
The fact that women are leaving Wall Street isn’t helping.
J. P. Morgan recently announced the head of commodities, Blythe Masters, will step down, after the recent sale of its physical commodities unit to Swiss commodity trader Mercuria.
Masters, who started at J.P. Morgan as an intern, was with the firm for 27 years and grew the commodities unit over that time. The official firm memo said she will take “time off” but insiders say she won’t be sitting around for long and offers are likely pouring in.
A week after Masters’s resignation, it must be noted, J. P. Morgan elevated a woman into a prominent position at the firm. Joyce Chang was named head of Global Research after a management reshuffle, according to a report in The Wall Street Journal. The firm has two prominent female executives on their operating committee — the CFO and head of asset management.
Morgan Stanley’s CFO Ruth Porat, who is one of the highest-ranking women on Wall Street, called the fact that too few women are in leadership positions “embarrassing.”
“Women are still not reaching the most senior levels of corporations,” said Porat, one of two women on the firm’s executive team, speaking at the Japan Society last week. “This is not the shortcoming of women. We’re talented and smart.”
Morgan Stanley has two women on its executive operating committee.
Networking and finding mentors are key to success for working women, say people in the industry.
“As a woman, you need to understand that you have to find people that could give you guidance and counsel and could advocate for you on your behalf,” said Bruce.
Bruce ultimately went outside Wall Street to look for mentors to get help in her career.
“The women who have joined our network have lower attrition rates from the work force than the average for the professional woman,” said Sallie Krawcheck, head of 85 Broads, in a recent interview with National Public Radio.
“So there’s something that’s happening in the network by bringing together these like-minded individuals, that’s helping these women in their careers.”
Ruth Porat, Morgan Stanley CFO
The culture also has to shift on Wall Street, Bruce points out.
Goldman Sachs Group Inc has five women on its management committee, and just one on its executive committee, according to its website. But not one of them is a likely successor, say Wall Street insiders.
Wall Street assumes president and COO Gary Cohn is the likely heir to CEO Lloyd Blankfein, another man. And there is only one women that holds an executive level position out of the 10 executive roles at the firm: Edith Cooper, executive vice president and global head of Human Capital Management.
One of the key drivers to getting promotions on Wall Street is to have experience in the profit and loss part of the business and revenue generation, notes Bruce.
“You had to be able to show you could drive revenue and manage profit and loss effectively,” said Bruce, reflecting on her own career path.
Another issue is women leaving the workforce when they start a family, because they feel they are not supported by their employer.
Morgan Stanley is among a few banks that are attempting to lure women back into the industry after having children. The firm recently started a “returnship” program to help mothers return to the workplace and get back on the career track, in an effort to combat the loss of women in the workplace.
The firm recently announced its new class of managing directors, which included 41 women, or 27% of the total – the highest in the firm’s history, according to a Morgan Stanley spokesman, reported in The Wall Street Journal.
J. P. Morgan started a similar program last year and Goldman Sachs launched the first such program in 2008, according to Crain’s Business. And Credit Suisse AG and MetLife Inc are starting programs this spring.
Bank of America Corp has four prominent women on its executive team, including the head of technology and operations and head of general audit.
Citigroup Inc has 23 people on their executive operating committee and only two of those are women — recently appointed Jane Fraser, CEO of mortgages and Cece Stewart, president of U.S. consumer and commercial banking. The banks could not be reached for comment.
There is a “grass ceiling” on Wall Street, notes Bruce.
“Golf is a big part of the Street and most women don’t play golf, so suddenly they are left out of important discussions,” said Bruce. “So Wall Street has to adapt the culture to adapt to women.”