Gender & Finance presented at the Interdisciplinary Brownbag Seminar in Temple University, USA, February 9th, 2022
Gender & Finance co-founder, Estefania Santacreu-Vasut recently presented in the Interdisciplinary Brownbag Seminar in Temple University, USA, on February 9th, 2022.
Thanks to the seminar organizer Samuel Rosen (Assistant Professor of Finance at the Fox School of Business at Temple University). Thanks also to the participants, including professors and students from Temple University such as Estefania’s coauthor, Professor Amir Shoham.
You can download the slides of the presentation below.
You can download the latest version of our research paper on SSRN.
Contact us for more information or for research collaborations!
The importance of acting as a citizen and financier for parity in the financial community
Why gender parity is key in corporate finance?
As a young senior associate and even more as a manager, I have committed myself and my team to promote women to succeed. In parallel to my professional activity, I am deeply involved in the association Level 20, a not-for-profit organization set up in 2015, to inspire more women to join and to succeed in the private equity industry.
Fewer women than men enter private equity and only a small proportion progress to take on leadership roles. We believe that increased participation by women, especially in leadership positions, will lead to improved and sustained investment performance. Many studies have shown a correlation between gender diversity in senior teams and higher returns on equity in quoted companies. We see no reason why private equity should be different. Our latest study with the British Private Equity and Venture Capital Association, completed in March 2021, shows 10% of senior investment roles are held by women compared to 6% in 2018.
Our aim is to increase the number of women in the industry, and we have set the target of 20% of senior roles to be held by women.
If you are interested in increasing gender diversity in corporate finance or more particularly in private equity, do not hesitate to contact me, I will always be at your disposal to help you develop your career in this direction.
And check out the Gender & Finance workshops organized by Prof. Longin and Prof. Santacreu-Vasut.
More about my background as an ESSEC Alumni
With more than 8 years of experience in the Private Equity / Transactions environment (Transaction Services, M&A advisory, private debt activities, growth capital, fund of funds) in Paris, Geneva and Johannesburg, I dedicate my time largely to the management and development of the Family Office La Fiduciaire de la Noria (Fontana Muñoz’ Family).
Recently I launched Fontana & Cie, an advisory firm. I work with entrepreneurs, corporates and investment funds during their financial due-diligence phases (buy-side / sell-side). With over 130 competitive engagements in a wide range of sectors, I take a very proactive approach in advising our French and international clients.
Collaborated with cross-border and cross-functional teams in English, French and Spanish. Managed deal processes with investment banks, legal, tax and strategic advisors for mid-cap and large-cap transactions.
I am a graduate of ESSEC Business School and a chartered accountant (“expert-comptable” in French). I am also passionate about education, I oversee the development of the ESSEC Alumni Finance, Banque & Assurance professional club. More recently, I co-founded the new private school group WeiD to develop in France.
In September 2022, I am going to fulfil one of my dreams, teaching Corporate Finance at ESSEC Business School.
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Gender & Finance presented at the European Financial Management Association (EFMA) Conference in Rome June 2022
Gender & Finance recently participated in the European Financial Management Association (EFMA) Conference that took place on June 29 – July 02, 2022, in the beautiful Campus of Bio-Medico University in Rome, Italy.
Gender & Finance presented at the Department of Finance at the University of Lausanne and the Swiss Finance Institute at EPFL
Gender & Finance recently presented its research at the research seminar in finance of the University of Lausanne and the Swiss Finance Institute at EPFL: Is Gender in the Pocket of Investors? Identifying Gender Homophily Towards CEOs in a Lab Experiment on December 4th 2020. The presentation took place online due to COVID-19 travel restrictions. Gender & Finance Co-founder and Associate Professor Estefania Santacreu-Vasut presented experimental research on the stock market reaction to CEO appointments as function of gender.
We received interesting feedback from PhD students and Professors.
Three stylized facts
At the seminar, we motivated our research with three stylized facts:
Fact #1: Women are under-represented in CEO positions.
Fact #2: Stock markets in the US react more negatively to the appointment of a female CEO than to that of male CEO.
Fact #3: Women are under-represented also in finance related educational and professional arenas.
We presented how our research can provide a unified explanation of the three stylized facts.
To do so, we unify three theoretical explanations: gender stereotypes, double standards and in-group biases.
We build a trading experiment to study how individual investors react to CEO appointments
We causally identify the role of investors preferences and quantify the role of investors’ gender diversity on the aggregate stock market reaction
In short, we find evidence of gender homophily among investors which can rationalize the relation between facts #1, #2 and #3
Contact us for more information or for research collaborations! And check our presentation slides!
The only measures adopted so far by the authorities to increase female representation on boards are the introduction of mandatory quotas or recommendations in domestic governance codes. These measures have the advantage of preventing discriminatory treatment of women, particularly in societies with strong cultural resistance, but they do not guarantee that women, once appointed, participate effectively and efficiently in strategic decision-making processes.
Message from our paper
Our main message is that the most effective and sustainable way for the authorities to increase the presence of women on boards is to take measures to promote equal treatment between men and women in society. Only if women have as much access as men to education, to the business world, and do not carry the burden of household chores alone, will they be able to develop expertise, seize professional opportunities and build a social network in order to enjoy the credibility comparable to that of their male colleagues so essential for weighing-in on board decisions. Without this, they will simply be tokens of diversity facilitating company compliance with regulatory requirements. Moreover, only then will the qualities commonly attributed to women materialize into a performance advantage for companies, which is the most powerful motivation for them to appoint more female directors.
Ethics vs performance
We stand out from most reports and press articles concerning the representation of women on the board, as such works adopt an exclusively ethical point of view. They present the appointment of women to the board as a goal in itself without addressing the question of the impact on performance or on the actual conditions under which women directors carry out their mission. We think it is important to emphasize the issue of the effects on performance because we believe that companies will not promote more female directors on the board for purely ethical reasons. The fact that this is likely to improve their performance and efficacy, however, is a strong motivation.
The added-value of women on boards
First of all, appointing women leads to a diversity of approaches on the board, which is likely to result in better quality strategic decisions. Secondly, women are perceived as having a more acute sense of ethics than men, which reduces a company’s inclination to manipulate results, improves the quality of financial statements, and gives shareholders more transparency about the impact of managers’ actions in relation to the board’s oversight mission. Finally, women are less over-confident than men, which avoids excessive risk-taking and empire-building behavior on the part of managers, thus better serving the objective of maximizing shareholder value. However, there is no impact on performance per se: the performance effect of appointing women to the board of directors depends on the socio-cultural context concerning the equal treatment of men and women in society. Gender equality, by promoting the possession of expertise and credibility comparable to that of their male colleagues, increases the likelihood that the economic benefits expected from the appointment of women will be effective.
Our empirical study, carried out over the last 12 years from a sample of 1986 companies in 24 countries, proves this very point. Our measurement of gender equality covers access to health, politics, business, the world of work and education, as well as equal treatment by the legal system (through inheritance and divorce laws). We observe that gender equality amplifies the positive impact of women’s presence on economic and financial performance. In Sweden, the appointment of an additional woman to the Board of Directors is associated with an increase in economic and stock market performance corresponding to four times that of countries where gender equality is at the median level (France and Australia). In China, Japan, Thailand, and India, where gender equality is low, the impact is non-existent or negative. In relation to the monitoring function of the board, our results show that, considered in isolation, the presence of women is neutral on earnings management and excessive risk-taking. It is only in the most egalitarian societies that female presence succeeds in reducing opportunistic behaviors, which are in the shareholders’ best interests.
Recommendation for firms
It is therefore in the interest of companies to appoint women with the required technical skills (without discrimination or preferential treatment compared to men) by allowing them to weigh-in on decisions on the same basis as their male colleagues. The key for companies is an increase in the effectiveness of the board in its advisory role, through improved economic and financial performance, and in its oversight of managers’ actions to ensure that they are effectively aligned with value maximization.
A comment from the Gender & Finance founders
This study shows that the socio-cultural context influences the impact of increasing female representation in Boards. One potential mechanism to investigate and that relates to the Gender & Finance project is the role of gender stereotypes in shaping the perceived fit (or lack of fit) of women to their board role. In less egalitarian cultures, female board members may be perceived as lacking the qualities needed in their role precisely because they are women. In more egalitarian cultures, female board members may be less subject to traditional gender stereotypes and be perceived more favorably when participating in decision-making.
Gender & Finance Literature Review Series #8: Haslam and Ryan (2008)
In this G&F LRS #8, we analyze the following research paper:
Alexander S. Haslam and Michelle K. Ryan (2008) “The road to the glass cliff: Differences in the perceived suitability of men and women for leadership positions in succeeding and failing organizations” The Leadership Quarterly 19(5) 530-546.
The authors are trying to know if there are differences between the perceived suitability of men and women for leadership positions depending on the performance of the involved company and if so, why?
The authors’ perception
From the authors’ point of views, the struggling predicament of women does not stop after breaking the glass ceiling -once they reach leadership positions. This feeling would explain why despite a higher number of female leaders, there are still differences between men and women in the type of leadership positions they occupy. Indeed, women seem to be more likely to be appointed to leadership positions in organizations in crisis.
The methodology used
To find evidence of this phenomenon, the authors conducted three different studies on three different types of sample – business students, college students and senior managers. The members of the samples had to evaluate the suitability of male or female candidates to a leadership position and its leadership ability either in a healthy business or a struggling one. Then, in the last study, the authors identified potential motives justifying why women are more likely to be appointed to more risky leadership positions.
These studies find evidence that women are more likely to be nominated for leadership positions in organizations in crisis. This confirms this existence of a Glass Cliff for women meaning that they do not have access to the same type of leadership positions than men, which can negatively impact their future career opportunities. The authors gave evidence that this phenomenon is not related to a hypothetical preference from women for risky positions but rather to social stereotypes. Glass Cliff could be another explanation for the predominance of women in non-core business positions. The authors also think that some women leave their management positions because of too limited opportunities to get more responsibilities and not always because of family commitment, another sign of the existence of the Glass Cliff.
Thanks for reading this post! You can download the PowerPoint presentation below to have more detail on the experiences and the conclusions of the authors. Please free to reach out to us for more information on the article or the Gender & Finance project.
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Today, I am writing about an exchange I had with a TMT analyst in London. Thank you to Zoé Lintz for her availability and her exhaustive answers!
Could you please describe what are you doing at JP Morgan as a TMT analyst?
In a large corporate bank such as JP Morgan, the daily environment is significantly different from what I experienced before in smaller M&A banks. Don’t forget that there is no “normal day” in M&A which is exactly what I was looking for. Each day differs depending on ongoing projects, clients demands or deliverables. We can perfectly get up thinking we’ll have a relatively calm day and finally be a stimulating one because of last-minute demand from a client who wants a special document or a new valorisation! Hence describing typical tasks is challenging but to give you an overview, I’ll tell you some typical tasks for an analyst:
Production of marketing documents such as pitches for prospects or information memorandum for potential investors
Associated tasks to fill in such documents: looking for information on companies through broker notes, press or specialized corporate finance websites
Performing financial analysis to build a financial model to value a business. We usually rely on financial projections given by the management team and/or reports from financial advisors that we challenge through different scenarii. We also use different valorisation methods to come up with what we think is the fair value of a business while explaining each hypothesis we retained.
I am highly satisfied with my choice because of the fulfilling and challenging environment I found here. Besides working with people with different cultural backgrounds is particularly thriving. I can always rely on my colleagues when I need some help and have never felt angriness. I appreciate the fact that the seniors know that as an analyst you have still a lot of things to learn, they are highly supportive! This is necessary to be able to work long hours.
Could you please explain why you chose JP Morgan?
After working for small structures, I wanted to try working for a bigger team. I thought this environment would be a springboard for the beginning of my career. Working in a team of 70+ people is radically different and teaches me a lot about relationship skills. The growth and the deal flow of the TMT team of JP Morgan also played a major role in my decision to join. I wanted to begin in London because I was looking for a more international environment that what we can find in Paris to learn other way of thinking while improving my English skills. Finally, London remains the core of the European M&A industry with the strategic offices of all major players as well as the most powerful investment funds. Thus, this city represents the place to be to quickly learn about finance and offers numerous opportunities to pursue a career in corporate finance.
Why were you interested in finance in the first place?
In 2013, I joined Sciences Po Strasbourg to become a journalist. This was after my exchange in the US that I began to be interested in finance. Hence, I joined the investment club at my university to learn more about it. I also did an internship in a small banking structure and realized that corporate finance is highly related to the news and offers the opportunity to learn about a large variety of sectors. I chose to specialize in media and technologies to develop a thorough understanding of this sector which gave a double competence in finance and technologies. I also like the technical side of corporate finance that relies upon concrete concepts. Indeed, we use mathematical models to forecast revenue and value a company,which has concrete impacts on the ongoing operation.
Have you experienced some difficulties at the beginning of your career?
Of course! But everybody does, it is the way you cope with difficulties that will shape the future of your career. For me, finding an M&A internship was extremely difficult because I didn’t come from target schools. I experienced numerous refusals and made a lot of efforts to secure an internship. I eventually was successful thanks to work and motivation. Indeed, you should be technically perfect for interviews and are ready to convince your interviewer that you really want to work in finance! This implies a lot of training and the best way to be fully prepared is to multiply the interviews.
Have you some advice for our readers?
Several ones. Do not hesitate to do different internships to find which position match your expectations. I did several internships before knowing what I really want to do. I learnt different aspects of finance but also to better know myself. We are continuously evolving; thus, it is important to be able to question ourselves about what motivates us and what we want about our careers!
Then, do not give up against difficulties such as I am not able to do that … I didn’t have the right education … Finance is not for me … There are a lot of misjudgements about finance. In addition, a similar place could be painful for somebody and thriving for another. Thus, you should go and see by yourself to make your mind.
Do not give up after a failure. You should create your opportunities by founding a club or organizing events to progressively build the right profile for the position that you dream of.
My last advice will be to speak with as many people as you can to better learn about finance and expand your professional network. This will really help your career!
Portrait produced in July 2020 by Maude Culis-Féry, ESSEC Student and M&A Intern at BNP Paribas.
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“Hello everyone, I hope you are doing well! Today, we have the pleasure to welcome a new special guest: Patricia Lormeau who is M&A Managing Director at BNP Paribas. Nice to meet you Patricia, first question, could you please explain to us your current position?”
Could you please describe your current position?
I am Patricia Lormeau, a Managing Director in the Domestic Market Team at BNP Paribas. In our team, I cover logistics and business services sectors. These sectors are highly interesting because they give signals about future economic and commercial trends.
Daily, I gather information about the sector through meeting management teams of the companies or other teams inside BNP Paribas. Being constantly in touch with executives in one sector gives you the legitimacy to speak with other executives and enables you in the end to reach new potential customers.
Being a managing director also means supervising the project team for each ongoing deal meaning nominate the members of the project, split the work to improve efficiency and sometimes dealing with two teams working on the same project. At this level in the banking industry, it is mainly a coordination, supervision and human job. It requires a lot of interactions with the junior staff preparing technical inputs and PowerPoint presentations to make sure these are correct and adequate to the goals of the project. This doesn’t make your job easy because you should keep a critical eye, spotting the mistakes the others didn’t see, maintaining a global view on the ongoing process to ensure its completion. While doing so, it is also critical to take time to teach your team because it represents a long-term time gain.
Personally, it has always been important for me to help young professionals to build their network because I know how critical it is in a successful career!
But this doesn’t mean, you cannot have a personal life. On the contrary, to stay in the long-term in the banking industry, you should keep a sane equilibrium requiring you to continue activities that you appreciate. For example, in my free time, I am the president of a charity promoting caring management and organizing conferences about current issues such as environmental ones
How did you become a Managing Director at BNP Paribas?
I am a kind of exception in the senior M&A bankers because I did not work in an M&A team before. In the beginning, I was a business lawyer following my studies in ESSEC and law university. I chose law because I wanted to be involved in the business environment while dealing with complex issues.
After a few years, I felt the need to discover other things and became an economist at BNP Paribas. I did appreciate the public side of this job because I was regularly questioned by French journalists on macroeconomic issues. But I was afraid to stay away from the business world too long, so I joined Iberia in Spain as Head of Financing. I preferred finance to law to intervene at the beginning of a project and not at the end when all details are already negotiated. What I liked in this experience was to become an expert in one sector and took part in professional conferences. Besides, working for Iberia was thriving as all our customers were abroad, so I travelled a lot. This job required me to be creative in the difficult aftermath of the World Trade Centre attack, which hurt badly the aeronautic industry. This pushed me to develop the parking credit to avoid a liquidity crisis for the aircraft owner.
After four years at Iberia, I went back to BNP to develop shipping financing when it was not as structured as today and had the opportunity to work in Japan.
I came in the Domestic Market Team thanks to a colleague, who was eager to benefit from my network and my ability to deal with complex issues. This enabled me to break into M&A in a senior position without previous experience.
Have you some advice for the young professionals?
Take time to travel abroad to understand business environments different from the French one. This will become valuable knowledge when you (potentially) go back to France to distinguish yourself from your colleagues.
Take time to try several sectors before developing expertise in a sector in which you are interested. Being an expert on a few sectors is required when you reach more senior positions because it will give you the legitimacy to speak your mind.
After the first years, it will be your network and your ability to adapt that will help you seize thriving opportunities. Bears it in mind during your first years.
You should keep a sane equilibrium requiring you to spend time with your family and continue activities that you appreciate. I have four children and I have always done my best to take care of them while pursuing full-time positions. Also, in my free time, I am the president of a charity promoting caring management and organizing conferences about current issues such as environmental ones.
Finally, you spend a lot of time with colleagues, so do not hesitate to change team if you don’t feel included. There are many places where using your financial skills and different kind of working environments. You just have to find the right one for you.
Portrait produced in July 2020 by Maude Culis-Féry, ESSEC Student and M&A Intern at BNP Paribas.
Stay tuned if you want to know more about Zoé Lintz who is TMT M&A analyst at JP Morgan… Her portrait is coming soon.
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Gender & Finance presented at EM Strasbourg Business School LaRGE seminar
Gender & Finance recently presented its research at the LaRGE seminar of EM Strasbourg Business School. The presentation took place in Strasbourg on March 13th 2020. Gender & Finance Co-founder and Associate Professor Estefania Santacreu-Vasut presented experimental research on the stock market reaction to CEO appointments as function of gender.
LaRGE (Management and Economics Research Center, UR 2364) is the University of Strasbourg’s research center focused on finance. We had interesting feedback from PhD students and professors.
“Hello everyone, I hope you are doing well! Today, we have the pleasure to welcome a new special guest: Laurence de Rosamel – Debt Advisory Managing Director at Clearwater. Nice to meet you Laurence, first question, could you please explain to us your current position?”
Describe your current position
I am Laurence de Rosamel and I currently work in Investment Banking as a Managing Director at Clearwater in Paris. I advise companies on raising financing through different channels such as banks, insurance companies, private debt funds and capital markets.
At Clearwater Paris, around 35 bankers are working to deliver high-value financial advice to our clients. Among these people, five are specialized in financing advisory. We work either in joint mandates with the M&A teams or on a standalone basis when our clients are only looking to raise non-dilutive capital. Most of our deal flow is related to acquisition financing, growth financing and refinancing transactions. Our clients are generally mid-market companies which are looking to raise between €10m and €300m.
Why did you choose finance? How did you begin?
In high school, I was attracted to business schools and thus entered a French “Classe Préparatoire”. But when my parents moved to the US, I decided to follow them and transfered to a BBA with a specialization in finance. I did a final year summer internship in Investment Banking because I wanted to learn a lot and was curious to experience what M&A was all about.
After graduation, I came back to France and realised that despite my degree and experience, I only had access to a limited number of opportunities in Investment Banking in Paris as I did not hold a Master. Thus, I applied to ESSEC for a postgraduate degree in Financial Techniques.
After ESSEC, I joined Rexel in the internal M&A team and after a year moved to DC Advisory (formerly Close Brothers) a Paris-based M&A boutique. I have been working in Midmarket Investment Banking ever since.
You have worked more than 10 years in the finance industry while many people give up after a few years, how could you explain that?
When I started in Investment Banking, I did not think I would last very long just like most of us out of Business School. If you had told me I would still be in the industry after 10 years, I would have never believed you. But in fact, time has flown incredibly fast and I was never bored. I think I am still here because I was lucky enough to always find new opportunities and challenges at every turn along the way.
Today financial institutions are struggling to hire enough young professionals and make them stay in the long-term. I think we should focus more on how to communicate about careers in the finance industry in a way that attracts the new generations. But also, we need to fully acknowledge that professional codes are changing and that we must take actions to further change the way we conduct business and manage teams.
What is your advice for young women in finance?
My advice for young women is mainly related to soft skills because technical skills can be learned. For me, the biggest hurdle for women in finance is a certain lack of confidence at times, which is not facilitating the fulfilment of their personal ambitions. Women should be bolder and not just rely on their accomplishments for their career evolution. Communicating extensively on your professional achievements is key, all your male counterparts do it so why don’t you?
Portrait produced in June 2020 by Maude Culis-Féry, ESSEC Student and M&A Intern at BNP Paribas.
Stay tuned if you want to know more about Patricia Lormeau who is M&A Managing Director at BNP Paribas… Her portrait is coming soon.
Posted inPortraits|Comments Off on Gender & Finance Portrait Series #9 – Laurence de Rosamel – Debt Advisory Managing Director at Clearwater