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Brits Propose Tying Bankers’ Bonuses to Female Executive Hires

November 4, 2015, 6:55 PM UTC
Keycorp CEO Beth Mooney Interview
Beth Mooney, chief executive officer of KeyCorp, speaks during an interview in New York, U.S., on Thursday, Dec. 6, 2012. KeyCorp, which has 1,059 branches, is targeting $150 million to $200 million of expense reductions by December 2013, the Cleveland-based lender said in a statement. Photographer: Scott Eells/Bloomberg via Getty Images
Bloomberg via Getty Images

Will bankers hire more women if their bonuses depend on it?

Jayne-Anne Gadhia, CEO of U.K. bank Virgin Money, thinks so. Gadhia was tasked by the British government to come up with ideas for increasing female representation in finance roles, according to the Wall Street Journal.

Gadhia spearheaded the review as part of a broader plan to boost the economy’s productivity. She suggests that banks tie executives’ bonuses to the number of women who hold senior positions at their organization. Gadhia also recommends creating an executive role responsible for overseeing diversity and inclusion.

According to the Journal, the number of women in the senior leadership at major U.K. banks was less than a third in 2014. At Lloyds (LYG), 29% of senior roles are held by women. This number drops to 22% at Barclays (BCS), while women account for 16% of top execs at Royal Bank of Scotland (RBS).

U.S. banks don’t fare much better than their U.K. counterparts. Women make up 25% of senior leadership at J.P. Morgan Chase (JPM), 23% at Citi (C), and 21% at Goldman Sachs (GS).

And those numbers get much smaller when you get to the C-Suite: KeyCorp CEO Beth Mooney (KEY) is the only woman to head up a top 20 U.S.-based commercial bank. In the U.K., Lloyds’ Alison Brittain is the only female CEO of a FTSE 100 bank.

Perhaps it’s worth trying out Gadhia’s recommendation on this side of the pond as well.