Gender plan for firms mooted

Philip Lane.

By Pádraig Hoare

The Central Bank may consider “whether it is necessary to put specific requirements in place” to improve female leadership in firms, the regulator’s deputy governor has said.

Sharon Donnery, who was speaking at Central Bank of Malta conference, said: “We would prefer to see the firms we supervise taking steps to increase diversity levels on a voluntary basis.

But in the absence of improvements in diversity at senior levels in regulated firms, the Central Bank will have to consider whether it is necessary to put specific requirements in place.

Echoing Ms Donnery, governor Philip Lane said earlier this week that the financial services industry has a “long way to go” to improve gender imbalance.

Speaking in Cork, Mr Lane said not enough women were represented in leadership and board roles in the wider financial sector. He said the Central Bank was “already at 50:50 male to female” and had a “fairly good ratio in terms of senior leadership between male and female” but that “more can be done”.

“The broader financial sector has a long way to go. We in the public sector, in the Central Bank, have gone a fair way but we do think it is a priority to try and push the broader financial system, especially at senior leadership levels, to improve the gender ratio,” he said.

Ms Donnery aimed fierce criticism at firms over the lack of diversity on boards, saying it was among the factors that caused the financial crisis in the last decade.

She said there was a “sound business case” for diversity, as well as an ethical one.

“We are placing a spotlight on this issue, and intend to keep it there.

We are doing so not from an ethical perspective, important though that is. We are doing it because there is a sound business case for diversity — one which can contribute both to the bottom line and the public good.

“In our supervisory role, firms can now expect the Central Bank supervisors whom they deal with to challenge them when there is a lack of diversity at board and management levels.

“We want the firms we supervise to make good decisions, take considered risks, and not suffer from group-think,” she said.

A report shows women make up 39% of directors and 49% of division heads at the Central Bank, and there is an overall difference of 2.7% between the average pay for males and females.

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