Is it true that female treasurers are more risk averse with a stronger desire for financial discipline than their male counterparts? A recent study by Barclays and Ledbury Research suggests so. According to the report, there exists a “unique distinction in how men and women’s emotions drive views on financial decision making” across the business world.
The findings lend weight to the claim that corporates may benefit from more informed judgements with women at the helm of their treasuries, while at the same time highlighting the distinct lack of females in such positions.
“In my view, there is no doubt that men and women think differently,” says Carol Power, Group Treasurer of Cable & Wireless Worldwide. “Men and women can be risk takers, but women generally want to understand more the consequences of those risks before entering into them. They like to take a more informed risk decision.”
“When it comes to assessing the consequences of risk taking, female treasurers may have a higher emotional intelligence than men,” agrees Sarah Powell, Group Treasury Manager at Rank Group. “They have more awareness that a decision might have ripple effects.” These views are borne out by the Barclays study, which found that 49% of male respondents declared themselves to be “financial risk takers” compared to 33% of females (see graph below).
“There are a number of explanations for this difference,” says Barbara-Ann King, Head of Female Client Group, Barclays. “Biologically, several studies have linked financial risk taking to testosterone; cognitively, men are more likely to be confident, though not more accurate, in their financial decisions; and sociologically, women tend to value wealth as a source of security, not opportunity.”
Qualitative decisions form the backbone of the treasury function. No matter how sophisticated a treasury management system is, or the extent to which automation is implemented across the function, balanced judgement is important when it comes to safeguarding a company’s finances. In a volatile market environment, surely it is better to have a cautious set of hands holding the business’s purse strings?
Yet there are so few female treasury bosses out there. “Being a woman in treasury has pluses and minuses,” says Michelle Dovey, Group Treasurer at National Express. “You clearly stand out from the crowd because you one of the very few women around. But it can be difficult particularly when you are trying to move on up the career ladder. Women are judged in a different way than men.”
The world of treasury is slowly starting to change from the bottom-up. In the early 1990s females were few and far between in corporate treasury offices, recalls Power. But while concrete figures are hard to come by, anecdotal evidence suggests there is now a steady stream of highly-educated young women flowing into corporate treasuries – though in Power’s opinion there are still not enough women making it through to the top of the profession.
Challenges remain. Take for example the large gender gap when it comes to pay packages, which can potentially stifle work incentive and career ambition. “As a female, I would be less likely to go to my boss and ask for a pay rise,” admits one treasurer who asked to remain anonymous. “I know that people around me often do that, but they are mainly men, who might not necessarily be in treasury but are certainly in my peer group.”
Furthermore, ‘glass ceilings’ reportedly block the career advancement of many females – not only in treasury but across whole industries. Take for instance the 2012 Fortune 500 list; it includes more female chief executives than ever before, but the ‘record’ amount is a mere 18 women, 3.6% of the total. Indeed, women accounted for only 12.5% of corporate boards of the FTSE 100 in 2010. Company boards remain dominated by aged men who have little incentive to change their ways and self-regulate. Mining giants Xstrata and Glencore, for example, have all-male boards.
Recently, there have been government efforts to tackle this stubborn bias. Last February a British government report, led by the former banker Mervyn Davies, called for FTSE 100 companies to increase the percentage of females at board level from 12.5% to 25% by 2015. “Corporate boards perform better when they include the best people who come from a range of perspectives and backgrounds,” Davies argues in the study. But without concrete quotas assigned, it will be difficult for such a target to be met.
Female treasurers remain divided over the subject of quotas, with some interviewees more in favour of them than others. But, as the Barclays report shows, there is growing recognition that women may be the safer bet when it comes to running corporate treasuries.
“It is still very difficult being a woman in the treasury world,” notes Marianna Polykrati, Group Treasurer of Vivartia. “But I think women are more risk averse and better at financial discipline in general. This is what counts in treasury.”