This content is from: People & Culture

Cover story: Women empowering change

To mark International Women’s Day, IFLR spoke to female leaders in the banking and legal professions. They reveal what must be done to get more women into leadership roles

The proportion of women in senior management roles globally stood at 29% in 2020, according to advisory firm Grant Thornton. This compares with 30% in the EU, 29% in North America and 27% in Asia-Pacific. Female leaders around the world have told IFLR that gender diversity in senior management is improving but there is a lot more to be done, especially when it comes to company and government policies that can help.

Women on the world stage

An unmistakably positive trend has been the rise of female role models in positions of power around the world. These include European Central Bank president Christine Lagarde, IMF managing director Kristalina Georgieva, EU Commission president Ursula von der Leyen, US vice president Kamala Harris and US secretary of the treasury Janet Yellen, as well as most recently Ngozi Okonjo-Iwaela, WTO’s director-general.

Bénédicte Nolens, head of the Bank for International Settlements (BIS) Innovation Hub in Hong Kong SAR, does not underplay the significance of this. “There are now more women than ever before in leading positions where they can set and influence policies that are critical for the future,” says Nolens.

The age and cultural diversity of these individuals inspiring confidence in women around the world to lead is also noteworthy.

“It’s not easy to be in the minority but you start to feel more comfortable when there are other women occupying important leadership roles,” says Nolens.

Yet, there is a lot that can be done to improve things for women on the world stage.

Changing the rules

When it comes to leadership roles in companies, board diversity is an increasingly important subject for corporate governance. One particularly controversial topic is whether companies should have gender quotas. According to data compiled by Deloitte, women held 16.9% of board seats globally in 2020. In Asia, the figure is 9.3%. This compares with 41% in Norway, which was the first country to enact a legislation in 2005 for a 40% female quota on corporate boards.

In 2018, the state of California introduced a law that meant all companies located in California had to have a minimum of one female director on its board – and by the end of 2021 the same law stipulates that boards of six or more must have at least three female directors. The state also legislates for underrepresented communities.

See also: Women in law: a reply to my daughter's sincere question

Joy Van Cooten, EMEA head of legal at ACI Worldwide, says that she has been an advocate against quotas because they lead people to think that a woman only got a role because she is the token woman, not because of merit.

“But I’m beginning to accept diversity quotas because the rate of progress has been so slow that we have to be that radical,” she says. “I’m wrestling with my conscience. However, I want to see real diversity, not token women.”

Nolens, who is a strong believer of quotas, says that opponents often rely on the argument that women who get board seats are token women who are not necessarily the best for the job.

This, according to Nolens, is “just inherently discriminatory”.

“It implies a belief that there are fewer smart women out there than men even though there is little difference between the average IQ scores of women and men,” she adds.

Not everyone agrees with this.

One founding partner at a law firm in Brazil is firmly against quotas. “As a woman I would professionally benefit from it, but women should be able to reach these positions because they are recognised as the best fit for the job, regardless of their gender,” she says. 

She continues: “A woman should be on the board for her merits, not because she is a woman, otherwise she will start off on the wrong foot. Entering the board because she's a woman instead of because she is the best person to be on the chair, regardless of gender, is not good.”

Carolyn Herzog, board member at the Association of Corporate Counsel and general counsel at technology firm Arm in California, agrees that although California’s regulation is designed to help it also has the potential to backfire, and and generally does not believe that quotas are the answer for most corporations (different from universities or other institutions). Herzog believes in setting clear and measurable goals that are appropriate to the organisation and that fill the gaps to address under-representation in the community.

“You may end up with a less qualified person in the role, who may then feel excluded and like a quota rather than a qualified person,” she says. “What you always want is the most qualified person who feels like they belong.”

Herzog recommends promoting a process that helps create an opportunity for the most qualified person, and one which recognises that underrepresented groups should have more opportunities.

“Firms should always hire the best person for the job, but I also believe in the importance of guidelines to make sure that you have a diverse panel of  people to interview,” she says. “Whether that is by mandate or not, people need to see the common sense in that. The importance of diversity has been proven over and over again.”

See also: Women choosing to challenge, stories from WIBL members

“If it has to be initiated by regulation – that's okay,” she concludes.

However, while boards often have diversity on factors such as culture, sexual orientation and religion, gender diversity continues to lag. Having three or more women on company boards is a good number, says Nolens.

“Unless women occupy at least 30% of board seats, it won’t make much of a difference because of unconscious bias,” she says. “When there is just one woman on a board, however assertive she might be, it’s natural to automatically discount her opinion because it is different from others’ on the board. It might also be more difficult for that woman to speak up.”

Fiona Nott, CEO at the Women’s Foundation in Hong Kong SAR, says: “Not only do we need to build a strong pipeline of female talent and provide women with the enabling workplace environment to reach the top, but we must also create the demand for such talent in senior levels of management, including at the board level.”

Unless both the supply and demand sides are addressed, efforts to achieve greater gender diversity will be undermined. 

At the listed company level, Nott says, we must aim for 50% women on our boards. To get there, it is time to set targets. Take Hong Kong SAR’s case, for example – she says that there must be meaningful targets of 25% by 2025 and 30% within six years which, if not met, should be mandated through quotas.

“Regulation should further require diversity policies to apply across companies and mandate that companies set measurable objectives to achieve their goals, creating accountability through regular and transparent reporting to the market,” says Nott. This holistic approach will increase the number of women on boards, strengthen the pipeline of female directors, and advance diversity across companies.

In some countries, such as the UK, while equal pay legislation has been in place since 1970, there remains disparity in pay between men and women. “Past and present governments have not taken the law seriously,” says Van Cooten. While firms have to publish data on pay, she says that the data needs to be drilled down further into gender and ethnic backgrounds because disparity persists.

“The data is meaningless if it does not give the true picture,” she adds.

Acknowledging progress

While there is clearly a long way left to go and a lot of work to do to reach gender equality in the legal industry, and across the corporate the space more generally, it is important to acknowledge the progress that has been made up to this point.

This year a female prosecutor was elected to the office of the vice president of the US for the first time, and female lawyers fill more positions of prominence than ever before.

In 1987, the American Bar Association (ABA) formed the Commission on Women in the Profession to assess the status of women in the legal profession, identify barriers to advancement, and recommend to the ABA actions to address problems identified. The very first chair was Hillary Clinton, who was a lawyer in Arkansas at the time.

“This is an issue that we’ve been working on for a very long time, and have made important progress on,” says Patricia Refo, president at the ABA. “To be a change agent, you have to be able to not only acknowledge the progress that has been made, but still see what remains to be done.”

The ABA has made huge strides. “While other bar associations around the world are welcoming their first woman president, we are on our 10th – that's progress,” she adds.  “At the same time, we know that in the legal profession women are still underrepresented in positions of power and underpaid. There is work yet to be done.”

For Refo, the most important step that can be taken towards achieving gender equity is being intentional about it, and measuring results. “Having good intentions alone is insufficient. There has to be intentional action to make a difference for women,” she says. “That is the responsibility of both men and women in the legal profession.”

Law firms need to look at their systems for advancing people to partnership and advancing people into firm leadership, and make sure that women are getting their fair share of those conditions.

Women in positions of power must also do what they can to help others reach the levels they have. In law, perhaps a more male-dominated industry than any other, this is crucial. One organisation where there is positive evidence of this is the International Swaps and Derivatives Association (ISDA), the main trade organisation for over-the-counter derivatives, according to Ann Battle, head of benchmark reform.

Battle has played a crucial role in the Libor transition at ISDA, easily the biggest regulatory development to happen within the last few years, but owes a lot of her success to senior women also involved in this work. “Our general counsel is Katherine Darras, she has played a key leadership position within ISDA and been a great help to me,” she says. “When I first started working on the Libor transition, Sandie O’Connor was the head of the Alternative Reference Rates Committee (ARRC) – the body responsible for the transition in the US. She was a great motivation and mentor.”

Battle continues: “At the time the ARRC was probably even more male-dominated than it is today. There would only be a few women in those meetings, but having a woman as the chair and as a very effective leader was a great example.”

While it is important for women to see other women in positions of authority, says Battle, it is equally important for women to have men take interest in their success and in what they do. “I have definitely benefited from this,” she says. “Very early on in my career, colleagues taught me how to ask questions, understand what I need to know to contribute and succeed, and really give me the confidence to ask those questions and learn what I needed to know.” 

More can still be done to create additional equality from day one, when people are very junior, to ensure that men are not able to work their way up and get access to high-level meetings, she continues, just because other males who are in more senior positions gravitate towards them and the idea of bringing them into the circle.

Diversity matters

Joanna Fields, founding principal at regulatory development and consulting firm Aplomb Strategies that advises corporate boards, is confident the progress made so far will be a good building point for the future, especially as the arena evolves. In the cyber area, she has seen women fill senior positions that nobody else wanted over the last years – those roles protecting banks, or law firms. 

“Those are the roles women took,” she says. “They weren't necessarily the client-facing roles, and I don’t want a client-facing person on board. I want somebody who knows something about enterprise risk management.”

See also: Podcast with Laurie Robinson Haden, founder and CEO of Corporate Counsel Women of Color

Fields says that she’s not sure that quotas are necessary. She is very optimistic about the line of women coming up and the roles that they've played over the last decade. “The regulatory focus on enterprise risk management, data privacy, cyber, and business continuity present opportunities for women on corporate boards that they are uniquely qualified, to an extent we have never seen before,” she says.

For Battle, a similar story. “One thing that makes it easier for women to break into benchmark reform is that it is very technical,” she says. “Technical fields are easier for women to break into because there is only so far you can go without the requisite expertise.”

She adds: “During the benchmark transition, there has been a lot of respect for people with the expertise. So if myself or any female is willing to put the time in and learn the issues, then they will be more likely to succeed.” 

Another important step is to train senior managers at firms and banks on the importance of diversity for the sake of development rather than for diversity’s sake. Isabel Costa Carvalho, managing partner at the São Paulo office of Hogan Lovells, stresses the importance of governance training.

“When IPOs first started in Brazil, I was in a drafting session with a logistics company discussing risk factors for the business,” she says. “I realised that there were absolutely no women at board level or among the executive officers. There was not a single woman in this company in a position that matters.”

She continues: “When I told them, everyone stopped, looked at me and said, ‘you must be nuts’, but there was no diversity. No company should have only women, and no company should have only men,” says Carvalho.

“Companies lose out by not having women because we think differently, and we can bring a lot to the table,” she adds. “More and more global companies are beginning to demand diversity in terms of background, race and gender – they want diverse teams.”

Succession planning

In order to build the pipeline of women leaders, tracking numbers in different stages of the career ladder is key. “Companies have to create a benchmark and put in targets because female leadership won’t happen if there isn’t a systematic approach,” says Nolens.

BIS, for example, she says, recently set a 50:50 gender diversity target to fill upcoming vacancies for managers and senior professionals.

This is also one of the challenges that Maggie Dou, head of legal Asia at Iron Mountain, sees. Having goals and objectives throughout different levels of a company can help. At Iron Mountain, for example, there is an objective for different departments to bring female managers to 33%.

“Once diversity goals are part of key performance indicators, there is more confidence that things will happen,” Dou says.

As a mentor in the Women’s Foundation’s mentoring programme, Dou sees the need for more women role models who can support the next generation of female leaders.

“We often don’t see female successors because they are so rare, so there needs to be more discussions on building the women leadership pipeline,” says Dou.

See also: Every organisation must start somewhere ACC's Veta T Richardson on-diversity in law

This can be done by increasing the percentage of female directors in companies through strategies such as getting recruiters to line up more female candidates for job interviews. Company management also needs to make sure that interviewers are diverse.

Sponsorship and mentorship schemes are useful for women to develop their careers. ACI Worldwide’s Van Cooten says that some women have found it difficult to find mentors or sponsors because men are sometimes afraid to mentor women as they do not want to be accused of inappropriate behaviour.

“This trend has gotten worse since the #metoo movement, but one simple thing to do is to have an open-door policy and give both the mentor and mentee peace of mind,” she says.

Van Cooten says that sponsorship and mentorship programmes can help women advance in their careers because women can get in front of people who can make decisions.

“Mentors can help by including mentees in high profile work that gets noticed,” she says. “They can also encourage mentees to come out of their comfort zones. The main thing is to give them confidence.”

Samantha Mobley, partner at Baker McKenzie in London, agrees and says that young women are often unsure whether they are good enough to go to for a certain role and sponsors and mentors can help to instil the confidence in them and encourage them to go forward.

“Women are often working hard but they don’t spend a lot of time to get noticed or be promoted,” she says. “They are not seeking out sponsors or doing enough networking.”

She says that women often undersell themselves, and for managers, the goal is to help identify women with leadership potential.

Better support programmes

A contributing factor to the lack of female talent in the leadership pipeline is the lack of support for women with children, which means most tend to leave the workforce after childbirth. There is a need for HR policies that can better accommodate women who have children, both during and after their pregnancies.

“It takes nine months to bear a child and about nine months for the body to unwind the physical and hormonal changes brought about by pregnancy. Multiply this by two children on average, and it adds up to four years in a woman’s career where she feels different from her normal self,” says Nolens.

For women in their 40s and 50s, they are also dealing with pre-menopausal and menopausal stages where oestrogen levels drop.

“While these were often taboo subjects, that is changing,” says Nolens. “Companies need to be aware of these stages in a woman’s career because if they are ignored, women will continue to drop out of the workforce at these critical junctures, perpetuating the gap at the top.”

Dou says that over the past five years or so, work-life balance has been changing in the legal profession. As a new mother, Dou has experienced the need for a well-balanced maternity leave and can understand how big a difference an extended maternal and/or paternal leave can be for new parents.

“The message for many companies now is that it is okay for women to fulfil their parental responsibility and can also have the space to be successful,” says Dou. “This message wasn’t so clear five years ago but now companies take pride in helping women.”

Being able to work flexibly can help tremendously. Van Cooten says that Covid-19 has helped in some respects, as everyone has had to adapt to flexible working.

“Women are often seen to be not ambitious or not wanting senior roles when they need to work flexibly,” she says. Rather than promoting presenteeism, company cultures should allow employees to work flexibly to have more dedicated staff. 

Company policies are the enabler of diversity, equity and inclusion initiatives, while culture and tone from the top can embed these across an organisation and drive necessary changes.

See also: Dechert podcast on diversity and inclusion

Nott says that key policies around parental leave, flexible work, caring responsibilities and prevention of sexual harassment, for example, are all critical but it’s the everyday culture, practices and leading by example which are the most effective ways to promote inclusion.

Senior management generally sets policies, but building a framework that allows for individual departments or teams to implement practices to fit their circumstances empowers the whole company to help build a culture that supports overall diversity, equity and inclusion.

Overcoming fear

However, things are not always so simple. More often than not the support network is not there and the disadvantages are firmly in place to make sure women do not get the necessary help to rise to the top.

As co-chair of Women in Finance Asia (WiFA), Nolens says that having a support system is key, not just for women but also men who are advocating for diversity.

“It gets easier when you know you are not alone. Role models, corporate and public policies, male advocates and support groups, it all makes a difference,” she says.

But for emerging countries in particular, finding support can be difficult. In Brazil, like many emerging countries in the world, the number of women entering law school is on the rise – but the number of women in senior positions remains statistically low.

“If you go to any law school in Brazil there are more women than men in the room,” says Juliana Martinelli, managing partner at Martinelli Advogados. “But even though they do enrol at law firms, when it comes to reaching leading positions in higher levels there are difficulties that usually pull women back.”

According to Martinelli, the expectations that society has towards women are so different to those of men that the playing field is a long way from being level. Professional women are expected to take care of children’s education and to take care of household responsibilities, even in households where both parents work.

“The problem is that women usually see themselves this way,” she adds. “It isn't only about the way that men look at women, it is about the way women look at themselves.”

For many women, the fear factor of taking the lead is a challenge that is difficult to overcome.

“Women often tend to be modest and don’t want to upset others or have the fear of not being good enough,” says Dou. Even though the external support might be there, Dou says that women need to change their mindsets to be more fearless and lean in more.

Women can be leaders in many ways, not necessarily just in the workplace. For example, as a yoga and meditation practitioner, Dou leads classes in her community.

“The leadership skills that you learn in a non-work setting can be transferable in the workplace,” says Dou. “Breakthroughs can happen when you start something you feel passionate about and not be fearful about failing.”

Women can help take matters into their own hands by being more assertive. She gave the example of where a man might see a job ad that he is not fully qualified for and still apply, a woman is likely not going to apply unless she has all the qualifications in the advert.

“It’s a mindset change and that is where a sponsor or mentor can help champion you and give you the tools you need to be more confident,” Dou says.

There has been much progress; women are consistently taking positions of power and prominence in the legal sector. But, there is a lot more work to be done to truly level the playing field. This drive needs to come not only from women empowering change, but from men, senior management, and government.

© 2021 Euromoney Institutional Investor PLC. For help please see our FAQs.

Instant access to all of our content. Membership Options | 30 Day Trial