Yesterday at dinner, I was discussing how a number of companies owned by married couples with men at the helm where struggling during this recession and my friend asked whether I had read Tim Adams’ article in the Observer on Sunday. As I hadn’t, he sent me a copy and I am delighted to share this with every working woman.
Testosterone and high finance do not mix: so bring on the women was an enlightening read on both behavioural evidence and neuroeconomic research around the global financial crisis and how the picture would have been different if women has been in controlling positions.
Gender inequality at the top of the financial services is a real problem. Michael Lewis author of The Big Short along with Joe Herbert and John Coates researchers on neuroeconomics at Cambridge University, clearly evidence women as being better risk managers than men. Coates explains that the euphoria brought about by testosterone when securing deals skews male judgement. They take higher risks on the hope that they will have a greater return. Women only have 10% testosterone so are not bound by the same chemical impacts. Their risks are evidently more calculated and spread.
I was not shocked to read that in only 5.5% of executive directors in FTSE 100 companies are women. However, evidently, female led companies provide at least a 35% higher return on equity and a board with more than 3 women have an 80% higher return. Of course this cannot be said about the financial services as they do not have female led businesses. Norway recently took radical steps to equalise the balance of power by imposing a 40% female quota on boards. Data is showing that this policy has been successful.
Without going into the whole article as you can read this for yourself, I want to highlight the one six main things revealed by the neureconomics research as reported in the article as it really made me shout hooray!!
■ Men’s brains tend to shut down after they have proposed a deal, waiting for the response. Scans show that women brains continue to be active, analysing whether they have done the right thing.
We are often blamed for over analysing and thinking too much about things by our male counterparts. I am pleased to see there is a positive stance on our female ways and actually this is great for business.
For all you working women out there, especially in the financial services, know that they way you work is far better value for money.
Bunty
