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Home > Business Ethics Viewpoints > Ladies in Waiting

Business Ethics Viewpoints

Ladies in Waiting

by Tim Hindle

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Tim Hindle is a freelance writer and editor. Educated at Worcester College, Oxford, and Heriot-Watt University, Edinburgh, he was a research analyst in the City of London before joining The Banker magazine as deputy editor. He subsequently wrote for The Economist for many years, acting as finance editor in the 1980s before taking on the new role of management editor.

He launched EuroBusiness magazine in the early 1990s, and then re-launched the Institute of Directors’ magazine, Director, later that decade. He has written a number of books. The Essential Manager’s Manual, published by Dorling Kindersley, was a worldwide bestseller. His latest book, Guide to Management Ideas and Gurus, was published in 2008 to widespread acclaim. Hindle has also written extensively about Turkey. His wife is Turkish and he has visited the country over 100 times in the past 35 years. During that time he has seen the country grow from an underdeveloped agricultural economy into a thriving European neighbor, a vital geopolitical bridge between Christian and Muslim nations.

Traders and Gender

There are too few women in key jobs in the financial sector. Promoting them is not just a matter of fairness; it’s a matter of prudent regulation.

Remember Liar’s Poker, Michael Lewis’s best-selling tale of his life as a Salomon Brothers’ bond trader in the 1980s? It is a story of how macho traders on Wall Street fleeced innocents on the high street, including front-line mortgage lenders like the Savings & Loan Associations. The book’s most memorable line—“If he could make millions of dollars come out of those phones, he became that most revered of all species: A Big Swinging Dick”—epitomized the financiers’ modus operandi at the time.

Twenty years on, little has changed. The ethos of Wall Street-type firms is still male, rude, and ruthless. If anything, it has become worse. In the 1980s the commanding positions in these firms were taken mostly by graduate investment bankers. But in recent years the biggest profit-makers have been the traders of both old- and new-fangled securities. Traders tend to be rough and ready, and to have a limited interest in the world outside their dealing rooms. Their rewards and their status have risen to reflect their growing contribution to their employers’ profits.

Traders, however, have shown that, uncontrolled, they can be lethal. At very short notice, they can throw banks into deep trouble. Nick Leeson, who brought down Barings in the 1990s, was a trader. His story was published as a book (and made into a film) under the title Rogue Trader. Jerome Kerviel, a Frenchman whose wildly spiraling deals at the beginning of 2008 lost US$7 billion for a much bigger bank, Société Générale, was also a trader.

These two rogues had other things in common. In the first place, both were young (in their twenties at the time) and male. And both came from humble backgrounds: Leeson’s father was a plasterer; Kerviel’s mother was a hairdresser. They had had little money of their own before billions of dollars of other people’s was thrust into their care.

No Place for Women

As yet, few women have made their mark in this particular world. While they have made great strides in entering the lower echelons of financial services firms, women in the industry have largely been excluded from its trading rooms and its corridors of power. Where women have reached high levels it has usually been in “softer” areas, including fund management, public affairs, or as a general counsel. At the time of writing, Goldman Sachs has only three women on its management committee of 29. Credit Suisse has none.

What’s more, the few women who really make breakthroughs seem to fall (or be felled) at the final hurdle. In 2007 Zoe Cruz, who started her banking career as a trader with Morgan Stanley, was fired just as she was about to take over as boss of the whole organization. The following year, Sally Krawcheck was eased out of Citigroup after being effectively demoted from the job of CFO.

Meanwhile, the bank that made the most creditable attempts to promote women, Lehman Brothers, is no more. Its much vaunted scheme to persuade female alumni to return after some years of absence evaporated when the bank went bust. At the same time, the Lehman Brothers Centre for Women in Business at the London Business School has, perhaps unsurprisingly, dropped the bank’s name from its title.

I believe promoting more women on Wall Street and in the City of London is part of the solution to the world’s financial ills, helping to ensure that banks and other institutions resist the urge to pursue suicidal strategies.

What the financial services industry needs is not just re-regulation in the place of deregulation, but more women in the place of men. It is not merely a matter of fairness. There is growing evidence that women are better suited to the work.

Writing in the Financial Times in April 2008, John Coates, a research fellow at Cambridge University who also once worked as a trader in New York, claimed that “as levels of testosterone rise, effective risk-taking gradually turns into dangerous behavior… testosterone is likely to rise in a bull market, increase risk and exaggerate the rally.” On average, men produce 40-60 times more testosterone than women. And young men, who are a majority in most trading rooms, produce much more than older men.

Coates then pointed to another hormone, cortisol—the so-called “stress hormone” —as having a similar effect, but in the opposite direction. “Chronic cortisol exposure,” he wrote, “promotes feelings of anxiety…and a tendency to find danger where none exists. Cortisol is likely to rise in a crash, make traders dramatically and perhaps irrationally risk-averse, and exaggerate the sell-off.”

And guess what? Cortisol production is dampened under stress by yet another hormone, oxytocin, which is produced in far larger quantities in women than it is in men. Which explains the very different reactions of the two sexes to stress. Men tend towards the “fight or flight” option, both of them choices which leave them fending for themselves.

Women, on the other hand, tend towards each other. They seek the comfort and strength that comes from being part of a group. Hence, so the argument goes, if trading floors were run by women rather than men, market booms and busts would be far less extreme.

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Further reading


  • Bazerman, Max B., and Don A. Moore. Judgment in Managerial Decision Making. Hoboken, NJ: Wiley, 2009.
  • Lewis, Michael. Liar’s Poker. London: Hodder Paperbacks, 2006.
  • Thomson, Peninah, and Jacey Graham. A Woman’s Place is in the Boardroom. Basingstoke, UK: Palgrave Macmillan, 2005.



  • Catalyst. “The connection between women board directors and women corporate officers.” July 2008.

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