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Women in Indian banks tip the scales towards success

Interesting bit of news. For me, it's about proper masculine-feminine balance.

What makes women successful in Indian banking industry?
Aman Dhall & Ravi Teja Sharma, ET Bureau, Sep 19, 2010, 12.14pm IST

Read more: What makes women successful in Indian banking industry? - The Times of India

When the global recession brought banking behemoths and financial institutions down on their knees, commentators dubbed it as a man-made disaster, "a testosterone-fuelled meltdown caused by men with high-risk appetite".

Pray, then, would the world economy be on a sounder platform today if these treasure chests were guarded by women managers? Nick Wilson, professor of credit Management at Leeds University Business School ( LUBS) thinks so. "Where we find companies with diversity on their boards, productivity is better. Having more women on the boards of companies does help. Women would moderate risk and would be more balanced," he says.

Was this the reason, then, that Indian banks, with better gender equality on board than their we stern counterparts, scraped though the economic slowdown unscathed? Prof Wilson nods again. "If UK banks had more women on their boards, the scenario post-recession would have been a lot different."

Banking in the West has traditionally been a male bastion and continues to be so. "It is very difficult for women to break the glass ceiling here (West)," says Sheila Wellington, clinical professor of management at New York University's Stern School of Business. "Data shows that the glass ceiling is still intact. I wish it were not true."

India offers some respite for Wellington. The banking sector in the country did have its male domination till the 1980s, but in the last three decades the gender equilibrium became 'fairly' poised.

According to a study by Standard Chartered Bank about women on corporate boards in India, the financial sector performs best in terms of gender diversity, nine of the eleven banks listed on BSE-100 have a woman on their board and two of these banks have a female CEO. In fact, through the recent recession, Reserve Bank of India had two women deputy governors on board, Usha Thorat and Shyamala Gopinath.

ICICI Bank, India's second largest bank after State Bank of India, is headed by a woman, Chanda Kochhar. So is the third largest in the private sector, Axis Bank, with Shikha Sharma at its helm. HDFC Ltd, India's largest housing finance group has Renu Sud Karnad as its managing director; Kalpana Morparia heads the Indian arm of global financial leviathan JPMorgan Chase & Co; Meera Sanyal is the country executive for Royal Bank of Scotland and; Manisha Girotra is the managing director of Union Bank of Switzerland's India operations.

"Women are not driven by wanting to just show numbers," says Karnad, who feels the recession was a result of excesses, of wanting to achieve goals at whatever cost. "Women are more practical and moderate in risk taking."

In this sense, the banking and financial services sector has been particularly lucky. For, while only 11% of the companies across sectors in India had women CEOs, 54% of these CEOs come from the financial services sector, says a recent EMA Partners International study. In the Fortune 500 list though, financial services just accounted for 7% of the women CEOs.

So what is it that makes women so successful in the Indian banking and financial services industry? "Retail banking is more of a relationship thing and women excel at that," says Karnad. In the Indian context, while women have started venturing out to work in the corporate world, they have been handling relationships at home too, as a wife or a mother. "This nurturing and adjusting attitude flows into the workplace as well."

For the current pack of women leaders in banking, the journey started in late 1970s and 80s. "There were hardly any women who went to engineering colleges those days. Banking and services was a natural move," says K Sudarshan, managing partner–India, EMA Partners.

Professor K Ramachandran, Thomas Schmidheiny Chair Professor of Family Business and Wealth Management, at Indian School of Business, adds: "In the 80s, leaders in banking realised that women could be great assets and their businesses need to be gender neutral. It is more about breaking the mental barrier."

The mid-80s saw a number of smart women graduating from the B-schools just when the Indian banking sector was starting to grow. ICICI, HDFC, HSBC, Citibank, were all expanding and were hiring during the mid-80s and the early 90s.

"We were fortunate to have senior role models like Tarjani Vakil, chairperson of Exim Bank who pierced the glass ceiling in the 1970s and '80s," says Meera Sanyal, who started her career in the mid-'80s with ANZ Grindlays Bank and is now Royal Bank of Scotland's country executive for India.

ICICI particularly nurtured a number of women—Chanda Kochhar, Shikha Sharma, Renuka Ramnath—who have today reached the top. One of most prominent among them is Kochhar, who joined the bank as a management trainee in 1984 and rose through the ranks to become the managing director and chief executive officer.

Today, of the eleven top executives working directly under her, three are women. "I give a lot of credit to ICICI, which as an organisation has allowed women to grow, prosper, handle responsibilities and offered equal opportunities," says Kochhar. Of the overall 40,000 employees at ICICI, a quarter are women. "It has contributed a lot to the feminine quotient in the Indian banking sector."

The bottom line for Kochhar, though, is an individual's own capabilities. But she agrees that diversity in a company does help to bring in different perspectives. "Women have done well in banking because it is a business where you need to keep in mind what the customer wants. Women have some amount of empathy towards a customers needs," she says.

However, bankers don't agree that it's only affirmative action that has led to a virtuous cycle. Reason: bigger the firm, more focused it will be to encourage equality of opportunity. The HR policy is structured to benefit all employees, not just women.

"Diversity is vital, be it in the form of academic background or gender, it creates the right environment, culture that helps the organisation to leverage on workforce's strength and skills," says JPMorgan Chase and Co's India head Kalpana Morparia.

Most women bankers agree that one of main advantages they had was the support system from their family. There may be numerous cases to belie their observation but for the achievers, family support made all the difference. "There is family, in-laws, friends and domestic staff that offer support to the household, which makes it easier for the woman to focus on her career," Manisha Girotra, managing director, Union Bank of Switzerland in India.

Interestingly, today, these women are role models for a number of other women who have the ambition and confidence to make it big in the world of banking. When you see talented women who have become successful leaders, you do get inspired to follow in their footsteps.

"Once you have a successful role model in a business, you tend to go for it. These women in the world of banking and financial services have given confidence to women to try such corporate jobs," says Ramachandran.

Read more: What makes women successful in Indian banking industry? - The Times of India

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