When leaders speak out about the importance of diversity and inclusion, they are in essence making a promise. They are declaring their support for an issue that can be difficult to solve, one that will require money and resources, continuous care and monitoring, and buy-in from the rest of leadership all the way down through the organization. Change is difficult to achieve and not everyone likes it.
But more than being vocal about diversity initiatives, leaders have to be sure to keep their promises on this issue. Nothing will discredit a program more than the notion that it’s all talk, full of hot air, or just a passing caprice. The same applies to a leader.
That’s why it’s so critical that leaders understand that words must be followed by actions. And that’s why the situation with the European Central Bank is so interesting.
Gender Discrimination at the Top
As many news outlets have explained recently, the European Central Bank governing council is composed entirely of men – 22 of them. One slot on the executive board – which is composed of ECB executives and leaders of national central banks in the EU – is open.
Recently, Yves Mersch, governor of the Luxembourg central bank, was appointed to the board. But given Europe’s increasing focus on gender balance in executive roles (see, for example, Viviane Reding’s recent proposal for boardroom gender quotas in EU countries), his nomination was challenged by the EU parliament.
Sylvie Goulard, the member of the EU parliament who issued the challenge, called the absence of women on the board discrimination. According to Germany’s Der Spiegel, she requested, “that at least one woman is immediately appointed to the ECB Governing Council.”
Goulard’s move has resulted in a standoff, and with the deadline for a decision or compromise on the matter, October 22, rapidly approaching, we could how the EU will approach its desired role as a leader on gender balance.
Sharon Bowles, chair of the EU Parliament’s economic and monetary affairs committee is backing Goulard’s call for women on the ECB governing council. The New York Times reported:
“There is now not even a single woman sitting on the main board of what is one of the most powerful and essential institutions in the E.U.,” said Sharon Bowles, chairwoman of the Parliament’s economic and monetary affairs committee. “The symbolic and practical effects of this absence are not without note.”
According to the Times, the ECB should have anticipated the hold-up. Bowles had already contacted the prime minister of Luxembourg and president of the Eurogroup of euro zone finance ministers Jean-Claude Juncker this spring, asking him to consider at least one female candidate for the job. She also asked him to develop a plan for getting women into these types of roles. The article continues:
“I have received some verbal assurances that no suitable women could be located, but no formal reply nor answer concerning the medium-term plan,” Ms. Bowles said. “In consequence, it is felt that our concerns have not been addressed in a sufficiently rigorous way and that it is not appropriate to proceed with the hearing at this point in time.”
It seems that Bowles and Goulard may be placated by the development of a plan to get more women into top central bank roles. And in fact, Bowles herself has decided to take action and apply for a position of governor of the Bank of England.
But moreover, these women have taken it upon themselves to show leadership when no one else would. Certainly in 2012, it seems unlikely that the ECB couldn’t find even one qualified women to nominate for a single seat on its council. This shows an unwillingness to look beyond the traditional boys club that dominates the finance world. Bowels and Goulard have pointed this out, and the ECB doesn’t seem to like it. The Wall Street Journal reported:
“I don’t think anything that has transpired has removed the parliament’s determination to have the gender issue [tackled],” Ms. Bowles said, adding that the European Council “should do the decent thing rather than be dragged kicking and screaming every step of the way,” on gender balance issues.
It can be difficult to take the diversity debate from talk to action. And certainly, even if a woman is appointed to the council, the culture will likely be toxic. Hopefully an influential person on the ECB governing council will take leadership on the subject himself, and champion the benefits of diversity from within.