22nd June 2011
A draft directive circulating in the City shows that Michel Barnier, Europe's internal markets commissioner, wants to impose mandatory quotas to dictate the number of women sitting on bank boards, says the report. He believes the change would help prevent the kind of "group think" often blamed for exacerbating the crisis that struck the industry in 2008.
His plan contrasts sharply with the UK government's less radical decision, after an inquiry by the former trade minister Lord Davies, to set targets to encourage greater female representation in the boardroom.
These proposals could force major changes to be made to the composition of the boards of the major UK banks. None of the banks listed on the London stock exchange – HSBC, Barclays, Lloyds Banking Group, Royal Bank of Scotland and Standard Chartered – would meet the requirement as set out in the draft. Other banks across Europe would also have to comply with the directive.
Barnier told the Guardian: "I believe it's essential that there is more diversity on boards of banks and other financial institutions, in particular more women. The issue is not just one of better gender equality, but also one of better corporate governance. We need to break the group-think approach, which has been far too prevalent in the past, with the disastrous consequences we have all witnessed."
Gender inequality has been an issue in the City for years. Last week, the Observer asked – should hormonally driven young men be allowed to run our finances? New research on traders' brain chemistry chimes with Mindful Money psycho-analyst Ken Eisold's work.