September 30, 2010
I am a former Wall Street professional now writing a history of women and Wall Street. I also blog about issues concerning women and finance at www.pettistripes.com and have written specifically about Section 342 in a recent post.
Historically, Wall Street has not rolled out a welcome mat to those not within its clubby enclave. Times do change, however, and many firms have established programs aimed at promoting gender and racial diversity. Unfortunately, those programs have not sufficiently alleviated this problem in the financial industry.
The impetus for creating the Offices of Women and Minority Inclusion arose after the House Financial Services Oversight and Housing Subcommittees conducted a joint hearing that examined the adverse impact of the financial crisis on women and minorities. Additional driving force came from a GAO Report released in May that found only a marginal increase in minority participation at management levels in the financial services industry from 1993 to 2008. Although the report acknowledges progress in private initiatives, it also noted challenges of recruiting and retaining minority candidates and the lack of middle management commitment.
Much has been made of the fact that many of the top financial regulators are now women, but that belies the truth that if women were truly well represented throughout the financial sector, these details would not make headlines. Inside both public and private spheres, female leadership at senior levels is slim. Some have wondered whether the fiscal crisis would have occurred at all had women been in charge. Personally, I dont believe that one gender is inherently any better suited for finance than the other or that reverse discrimination should be encouraged. Greed and imprudent decision making transcend gender and racial distinctions. A more inclusive culture in the financial industry, however, could foster a more robust dialogue and way of doing business. If Wall Street more accurately reflected Americans, then Main Street might also become more financially literate, another factor in building long-term systemic stability.
I hope for the time when the various Offices of Women and Minority Inclusion report that their roles are no longer needed. Section 342 is not a panacea and could open a Pandoras Box given its existing broad and vague language. Careful thought needs to be given to defining fair inclusion and considering termination measures.
If we really want to attain a more inclusive and multicultural Wall Street, then solutions must come from several sources. They need to come not only from top-down approaches that some see as unwarranted governmental intrusion, but also from ground up efforts that give rise to a more universally financially literate population, as well as through sincere commitments throughout the middle ground which is the workplace. Corporate culture must be infused with a more respectful and heterogeneous atmosphere, and one that takes creative steps to address the needs of a diverse workforce. In the meantime, I look forward to seeing prudent implementation of Section 342.
Thank you for the opportunity to comment.
Sheri J. Caplan