United Kingdom Lawmakers Bemoan BOE’s Lack of Diversity in Top Roles

LONDON (Capital Markets in Africa) – A lack of diversity at the top levels of the Bank of England has drawn the ire of U.K. lawmakers.

Nicky Morgan said the Treasury Committee that she chairs is concerned about imbalances at the BOE’s most senior levels. Silvana Tenreyro, who appeared before the legislators on Tuesday for her appointment hearing, is the only woman on the nine-member Monetary Policy Committee that sets interest rates. The Financial Policy Committee, responsible for financial stability, has no women at all.

While Morgan approved the MPC postings of Tenreyro and her colleague Dave Ramsden in a letter to Chancellor of the Exchequer Philip Hammond, she asked for confirmation that “all efforts are being made to encourage as diverse range of candidates as possible.” She also called on the Treasury, which makes the appointments, for historical data about recent applicants and said her panel may seek further evidence.

The BOE is hardly alone in its lack of diversity. The European Central Bank’s 25 policymakers include just two women — Executive Board member Sabine Lautenschlaeger and Cypriot central-bank Governor Chrystalla Georghadji.

But the U.K. central bank has lost a number of high-profile female officials in the past year, at a time when it faces accusations of groupthink among its policy makers.

Kristin Forbes and Minouche Shafik both left the MPC, and Charlotte Hogg, who replaced the latter, resigned in March after the Treasury Committee criticized her for failing to disclose a potential conflict of interest. Clara Furse stepped down from the FPC last year and Jenny Scott recently left her job as executive director of communications — to be replaced by a man.

Pay Gap
The issue of gender came up a number of times during Tuesday’s hearing. Governor Mark Carney — who joked it had taken him “about five minutes” to notice the gender imbalance on his arrival in 2013 — revealed that the central bank has a pay gap of 24 percent due to a dearth of women in senior roles.

There are just three women among the BOE’s 16 executive directors, according to a list on the bank’s website. Only Chief Operating Officer Joanna Place is senior to that level.

Still, the governor said Tuesday the BOE has “steadily increased the number of women in senior positions from 20 to 35,” and there was “no pay gap on an equal work for equal pay basis.” The bank is in the middle of a deliberate strategy of making further strides to improve the gender balance, he said.

Hogg’s replacement Ramsden was asked bluntly whether there were “no women capable of doing your job?” He replied that there definitely were, before highlighting a wider imbalance in the field of economics.

Gender Focus
The 11-member Treasury Committee has four female lawmakers, the highest proportion ever, and Morgan is its first female head. Gender is shaping up to be an important issue in its new iteration, with the panel announcing on Thursday that it is starting an inquiry to identify the barriers to women entering and progressing in the financial services industry.

While the Treasury did not immediately comment on Morgan’s letter, Chancellor Hammond was also grilled on the BOE’s gender balance during his own appearance before the committee last week. He said that while diversity is important, the Treasury must “first and foremost” find a candidate with strong enough qualifications.

“Obviously ensuring that the other criteria that we seek to apply — including gender balance — are met is an important part of the selection process, but we need people of internationally recognized talent,” he said. “We’re not talking about giving people a chance, we’re talking about recruiting people who are already recognized as global leaders.”

Source: Bloomberg Business News