The Financial Conduct Authority which regulates financial services firms in the UK is about to impose internally set gender quotas for the 2400 banks, building societies and investment companies it regulates.
Clearly it is imperative to increase the percentage of women on boards, but is this really the best way?
I favour the approach taken by people like Harry Gaskell, who was CEO at my former employer Cap Gemini Ernst and Young UK and champions diversity and inclusion at Ernst & Young. Ernst & Young has self selected to increase the number of women in senior positions through a carefully managed but statistically measured approach. This enables women with the skills and confidence necessary to operate as equals on the Board to be promoted and to deliver with impact.
I am not saying that quotas will fail in all circumstances, but I can see a few scenarios in which they may be doomed – where playing a numbers game could come back to haunt the cause. For example:
- It could force firms to promote women who are not ready in order that the firm meets imposed quotas, resulting in underperformance.
- I dare say, it is an opportunity for any cynical misogynists out there to promote women who they know to be under-qualified such that these women fail, leading to a diminished view of women as leaders.
OK, I know the latter is a bit extreme, but not beyond the realms of possibility.
Anyway, I would love to hear your thoughts on this debate, and what you see could happen once the FCA imposes quotas on financial firms.