Finance and Investments

Gender balance requirements and usefulness are frequently seen as part of the bra burning feminist culture and treated with disdain. Nicholas D Kristoff writes in an Op-Ed piece for the New York Times that banks around the world ‘desperately want bailouts of billions of dollars, but they also have another need they’re unaware of; women, women and women.”

This comment follows on from discussions which took place at the recent World Economic Forum in Davos, Switzerland (For the uninitiated this is a bunch of old white men who meet to talk about the world economy. Unfortunately no solutions to the dire situation have been proposed).

The consensus was that banks need women to improve the quality of decision making – it is pretty clear that the quality of decision making to date has been shoddy to say the least. An article in the Journal of Economic Theory supports this after an analysis of research in the field of problem solving; diverse groups perform better. It won’t surprise you to know that I subscribe to this view. Women don’t subscribe to peer pressure, have a greater concern for the common good and among other things don’t suffer from over confidence (but more on this in Girls Just Want to Have Fund$). This makes for considered and sensible decision making, obviously sorely needed in the giddy realms of financial institutions. In fact as Kristoff reports the Davos discussions concluded that if Lehman Brothers (a large US bank which is being bailed out) had been Lehman Brothers and Sisters they may not be in the same mess today. There is a whole range of research compiled by researchers such as McKinsey, Goldman Sacs and Catalyst which show women are a huge missed economic opportunity.