THE BLOG

Female Quotas Are Nasty But Necessary

20/08/2013 12:37 | Updated 18 October 2013

There are not enough women in the boardroom of financial institutions. Not just an opinion I've held for a long time but one now recognised by the EU. This week, in an effort to address the low numbers, the EU has introduced a directive requiring these institutions to have quotas for numbers of women on their Boards.

And these are needed. Currently women make up only 17% of Directors of FTSE 100 companies. A number not helped by the fact that only 12% of Directors appointed in 2012 were female.

However, boardrooms are not the only area where such measures have been considered to increase female representation.

All-female shortlists are available to all political parties to increase the number of female MPs in Parliament (though, to date, only the Labour Party has used them). Also, the banking reforms proposed by the Parliamentary Commission on Banking Standards in June included recommendations to introduce quotas for women on trading floors.

We all know business and politics are dominated by men. In a rather pathetic indictment of the situation, there are more Eton graduates than women in the Cabinet. But why are we resorting to quotas to address the problem? What happened to skills and talent?

Well, the reason why women have virtually no representation in these spheres is absolutely not because women are not as clever as men or as capable. That's a ridiculous suggestion. The reason for the low representation is straightforward - business and politics are not level playing fields.

The only argument against quotas or all-female shortlists is that women should be promoted on their merits. What a wonderful world this would be if it were a genuine meritocracy. The problem of low representation is because women are not being promoted on their merits.

Whether it's the institutionalised sexism or the old boys' network, women who would be the best candidates are not getting their deserved opportunity because of discrimination. So, to address this skew, quotas are necessary.

The quotas, the all-female shortlists, are designed to create the level playing field that does not exist. I wish they weren't necessary. I wish we lived in a world where sexual discrimination wasn't so endemic. But we do. And in such a situation, quotas are therefore necessary.

Yet what intrigues me most about the proposals are not so much the quotas themselves but their possible impact. What will the impact be of having more women on trading floors, in Parliament and in the boardroom?

Stuart Wheeler, Treasurer of the UKIP Party, made headlines last week when he said that "business is very, very competitive and you should take the performance of women in another competitive area, which is sport, where men have no strength advantage. Chess, bridge, poker - women come absolutely nowhere."

Of course the great irony is that sexist comments like this only prove my point on why we need quotas. What hope do women have in the face of such attitudes from politicians? But beyond this, his views on character traits, and whether they can be attributed solely to men or women, are widely held.

Earlier this year even the Dalai Lama found himself a surprising recipient of accusations of sexism when he said that "females have more sensitivity about others' wellbeing [than men]" and went on to reference how compassionate his mother had been in comparison with his father.

Yet personality traits do not belong universally to one gender or the other. It is not a universal truth that all women are compassionate and kind, and that all men are competitive and ambitious.

From my all my years of experience in the City I can assure you that women can be just as tough as the alpha-males. Banking attracts a certain personality type - the Type As. And that personality type can be found in women just as it can in men. The question is, do they exist in the same numbers?

When it comes to making generalisations, are there greater numbers of compassionate women than there are compassionate men? And are there more ruthless men than ruthless women? Are we in the realms of a nature versus nurture debate here? I expect so.

So when these quotas become effective and the numbers of women increase, will trading floors become more risk-averse? Will boardrooms be more effective in their oversight? Will Parliament become less boisterous, more calm and considered?

In the short-term, No. If character traits belong to both men and women, then we're not likely to see any immediate change, or should that be improvement, in behaviour. The women who are already there and waiting for their opportunity are much the same personality types as the men.

But long-term... Well, this is where the anthropological study will really kick off. If women really are more likely to be calm and rationale than bolshy and aggressive, then there will be a change.

But then again, if we really do open up the opportunities for the next generation of women, their nurturing will change. As well as the traditional female professions of teaching and nursing, a career in business will become just as likely. This will have a knock-on impact in how girls are taught as school, how their horizons and options are broadened.

Will we see greater numbers of alpha-females come through as a result? I wait in anticipation.