The power of role models

Earlier this week, I travelled to Washington to listen to Elizabeth Warren, the Democratic party senator, deliver a barnstorming speech about the future of financial reform. The encounter, at the opening dinner of a conference on economics and finance, was fascinating. These days Warren is attracting attention as she is considered a possible challenger to Hillary Clinton for the Democratic party crown. And though Warren has repeatedly denied that she intends to run - and made no reference to this on Tuesday night - her constant criticism of Wall Street and of America's wealthy elite has made her the darling of the grassroots left.

So much so that one of the biggest talking points in US politics is whether the Clinton campaign can find a way to borrow some of Warren's populist policies without alienating Clinton's wealthy backers on Wall Street. And Tuesday night demonstrated that Warren certainly knows how to spark passion in a crowd.

But there was another reason why the encounter was fascinating. For the Warren interview was merely the opening salvo in a bigger, more striking symbolic performance. The next day, when the finance conference took place, it featured an almost all-female roster of speakers. The top of the programme featured Christine Lagarde (head of the IMF) and Janet Yellen (chair of the Federal Reserve) in conversation. Then, Esther George (head of the Kansas City Fed), Sarah Bloom Raskin (deputy secretary of the Treasury), Kara Stein (a commissioner at the Securities and Exchange Commission), Sharon Bowen (commissioner at the Commodities Futures Trading Commission) and Brooksley Born (a former head of the CFTC) discussed the future of global finance and economics.

There were plenty of men in the audience but the only man on the programme was Robert Johnson, head of the Institute for New Economic Thinking (Inet), the think-tank that organised the event along with Anat Admati, an outspoken (female) finance professor at Stanford University.

Was this demonstration of female financial power a good thing? When I first saw the programme, I felt distinctly ambivalent. The only time I have seen something similar was when I chaired an all-female regulatory panel at a Boston banking conference last year. Back then, as I wrote in this column ("All-female panels: the new normal?", December 11/12 2014), I found the experience exhilarating in many respects: by subverting norms, the panel helped me realise how unbalanced finance usually is. But the line-up also felt a little artificial, if not forced. Particularly since the audience was predominantly male.

The Washington event provoked a similar unease but when I looked around the room, I realised that it inadvertently illustrated another key point: gender is not the only point of discrimination in finance or policy making today. Nor is it the most extreme. What was notable about the Washington conference was that the vast majority of faces, male and female, were white. And that reflects reality: these days there is a real shortage of African-American or Hispanic people in senior financial roles. Or, as my colleague Simon Kuper notes this week, subtle structural discrimination is rife.

As I looked around, something else occurred to me: namely that when people such as Warren were growing up, it would have been hard to imagine such an event ever taking pace. Two or three decades ago, there were so few senior women in financial policy that you would have struggled to create a credible roster. Even today in Europe, it might be difficult to fill an entire programme. To be sure, there are some striking female pioneers, ranging from Angela Merkel (German chancellor) and Erna Solberg (Norwegian prime minister) to Ana Botin (head of Santander) and Helena Morrissey (CEO of Newton Investment Management). This week's Inet conference roster also featured Signe Krogstrup (a senior figure at the Swiss National Bank) and Claudia Buch (vice-president of the Bundesbank).

In Washington, by contrast, there is now such a long list of women who have held policy-making roles that the organisers could have filled the programme in numerous ways. So, while I started the event feeling worried about "tokenism", I ended up with a sense of respect, if not grudging pleasure, for the idea. That is not because I think that women in finance have magical powers; I do not think putting women in charge of the banks, say, solves all the problems. Nor is it because I think that staging a conference of this sort shows that the gender issues have been solved; on the contrary, women remain lamentably under-represented in many fields. But pulling this many women together into a room to talk about something other than gender does have a powerful demonstration effect: if nothing else, it shows the next generation of up-and-coming female students that they have a set of role models.

It illustrates something else too: social patterns and attitudes can sometimes change, even when they seem rigid, swathed in decades of prejudice. Perhaps the real question we should ask is whether it is time to organise an all-black or all-Hispanic financial policy-making event of this sort? And, if that occurred, would it help to combat that structural discrimination - or smack of even more tokenism? It is an intriguing question to ponder. And, of course, a topic that is distinctly taboo.

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Illustration by Shonagh Rae

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