Women represent a tiny fraction of management positions in Latin American banks

The gender balance at the highest levels of Latin American banks continues to tilt heavily in favor of men.

On average, women make up 11.14% of executives and board members of financial institutions in Latin America, according to data compiled by S&P Global Market Intelligence. In Europe, this figure is 21.27%. Asian financial institutions point to 13.13%, and those of the Middle East and Africa to 14.21%.

The actual percentage of women on boards and management teams in Latin America might be slightly higher, given that employee gender disclosure is not as prevalent as in other regions. In fact, Latin American financial institutions did not disclose the gender of 17.48% of employees in management positions. Men accounted for 71.39% of reported leadership positions.

According to the International Finance Corporation, the number of women in leadership positions continues to lag despite research showing that their inclusion brings benefits such as better financial performance and shareholder value and reduced risk of fraud. and corruption. Quotas in some countries have helped increase numbers, but progress has been slow in conservative cultures where it is often claimed there is a lack of qualified female candidates.

“I want to demystify what some people think it takes to be on a board. Whether it’s in Latin America, the United States, or anywhere in the world, when I hear that we can’t find enough qualified and diverse candidates, my first response is you made the first mistake of assuming it’s about qualifications,” said Cid Wilson, President and CEO of the Hispanic Association on corporate responsibility.

“We assume that every admin is a qualified admin. I have a long list of unqualified admins who got there either because it was a family tie or because they had old money and they were able to invest,” Wilson said.

According to Wilson, getting on boards is about sponsorship and networking, not qualifications.

“If you look at the social construction of many countries in Latin America, when yes, you’ve seen more women progress in terms of owning businesses and being able to succeed… there’s always this dynamic where women are often left out, whether it’s country clubs, social gatherings, meetings where a lot of these sponsorship relationships start to develop,” he said.

Slow progress

“We’ve seen an increase over the last five to seven years, but we’re not happy with the numbers,” said Daniel Aguiñaga, senior partner for corporate governance in Mexico at Deloitte. There is no rotation of directors with long terms, and “boards are not open to director changes or board growth.”

Deloitte’s recent edition of its report “Women in the boardroom: A global perspective” shows that the number of women on boards in Latin America has increased from 7.2% in 2016 to 10.4% in 2021. The number of female CEOs increased from zero to 1.6%. While most countries have made progress, the numbers remain unimpressive. In Colombia, 15% of directors are women, compared to 10.4% in Brazil and 9.7% in Mexico.

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It doesn’t help that Latin American cultures continue to carry a chauvinistic legacy that still sees women needed in the home whether they have support or not, Aguiñaga said.

According to Ruth Medd, executive chair of Women on Boards, an advocacy group, the change will come through quotas and will require government boards to monitor the process. Stock markets should also have demands and interest groups should become more active, she said.

“We need to see more action from companies,” with organizations changing their policies, Deloitte’s Aguiñaga said.

Having women on boards should be a no-brainer, he said. Women represent 50% of the market and talent pool. They make the vast majority of consumer decisions in families. By omitting them, companies limit their prospects and opportunities.

According to the IFC, companies with at least one female director see better share prices and better return on equity. With at least 30% women in leadership positions, profit margins and rates of return on investment increase.

“It’s a business case,” Aguiñaga said. “It was seen as, oh, it’s because of fairness, it’s because it’s a great business. No. It’s a business case.”

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