A “simple strategy” for global growth: In Brazil and Mexico, only about 40% of the population have bank accounts, which Santander Executive Chairman Ana Botin sees as a big opportunity. Though Santander has the most customers of any bank outside of China and India, Botin’s goal is organic growth, and its own customers also offer some runway in that regard. Just 13% of the Santander’s customers use it as their main bank, and by growing customer engagement, the bank could earn more fees. Botin used Twitter to elaborate on what she calls her “big idea,” describing it as "a simple strategy of relentless focus on customers' needs and superior execution. Our aim is more loyal customers, employees and shareholders by being simple, personal and fair in everything we do.”
Revived: A group led by Maria Contreras-Sweet and backed by billionaire investor Ron Burkle said it reached a last-minute deal to acquire the assets of the embattled Weinstein Co. A different deal, in which the group would have continued to operate the company without filing for bankruptcy, died just a few weeks ago. Contreras-Sweet, the former head of the Small Business Administration under President Obama, said her team will be launching “a new company, with a new board and a new vision.” She also said that women will control the majority of the new company’s voting stock and that “I will be chairwoman of a majority-female board of directors.” The deal includes a victims’ fund worth up to $90 million, and Harvey Weinstein, who has been accused of sexually assaulting and harassing women for decades, will receive no cash from the sale. See the full story in the Wall Street Journal and the New York Times.
Next in line: In case you needed yet another next-CEO rundown for JPMorgan Chase, here’s the latest overview of Jamie Dimon’s list of possible successors brought to you by the Wall Street Journal. This one has a focus on Chief Financial Officer Marianne Lake, who is sometimes a diplomatic foil to the outspoken Dimon. Lake is well-known as a fixture on earnings calls and emcee of the company’s Investor Day. Among the other possible candidates are Mary Callahan Erdoes, Doug Petno, Gordon Smith and Daniel Pinto, though the paper speculates the latter two may be out of the running because of their ages. By the time Dimon is expected to pass the torch, Pinto and Smith will be at least 60, whereas Lake, Erdoes and Petno will be in their 50s, the more “common age” for a new bank CEO. (Both Lake and Erdoes rank among our Most Powerful Women in Banking and Finance.)
Closing branches, raising eyebrows: Capital One is discriminating against blacks and Latinos by closing branches in predominantly minority communities and forcing customers there to bank primarily by debit card, two civil rights groups argue in a new lawsuit. The lawsuit, which Capital One said is “baseless,” hinges largely on the report of a former employee, Laurie Vignaud, who reportedly had been with the company for 20 years and worked on its Community Redevelopment Act initiatives. Vignaud said that she lost her job with Capital One last year after complaining that it was violating CRA by closing branches in certain areas.
Suspicious silence: Three female senators are pressing securities regulators to look into whether Wall Street firms are covering up sexual harassment problems. In letters to the Securities and Exchange Commission and FINRA, the senators questioned the relative lack of reports about sexual harassment on Wall Street compared with industries like entertainment and media, saying it is not a sign that misconduct is not happening. The senators said that “the silence appears to result from strong ‘cultural and financial forces' in the industry that discourage speaking out, including payout of large settlements with non-disclosure agreements to harassment victims, class-action prohibitions, and forced arbitration." The letter came from Sen. Elizabeth Warren, D-Mass., Sen. Catherine Cortex Masto, D-Nev., and Sen. Dianne Feinstein, D-Calif.
One way to impose more equality: As part of an effort to address sexual harassment and bullying, Fidelity Investments might abandon the way it rates and compensates analysts, in favor of a team approach. Analysts historically have been junior to the star portfolio managers, supporting their investment picks with research and new ideas. But the analysts could be given comparable footing with senior managers in choosing securities, if Fidelity opts to go with suggestions from an outside consultant. The overhaul being considered is part of “a reckoning under way inside the equity division, which for years dealt quietly with accusations of sexual harassment and other misconduct.” This past fall, Fidelity dismissed two of its prominent money managers over sexual harassment allegations, and at least six cases of alleged discrimination against female employees over the past decade have come to light. In rare public remarks in November, Fidelity’s CEO, Abigail Johnson, a repeat honoree in American Banker’s Most Powerful Women rankings, vowed to root out the mistreatment of women at the company.
Questions unanswered: Bank of America has fired two more employees in its prime brokerage unit, after they interfered with a probe into sexual harassment allegations against Omeed Malik, a managing director in the division. Malik was fired in January following accusations by female colleagues. There are several unanswered questions in B of A’s ongoing misconduct probe, including whether it’s focused on the prime brokerage unit or if it’s been expanded to include other parts of the company. It’s also unclear if additional sexual harassment allegations have been made against other B of A executives and if any related disciplinary action has been taken against other employees.
A picture is worth 1.000 words: Sallie Krawcheck called out Morgan Stanley in a LinkedIn post, sparking debate in the comments section about the state of female representation in leadership positions. The post includes a picture of a Morgan Stanley ad introducing its new class of managing directors in wealth management. The Ellevest CEO pointed out that just three of the 48 new MDs are women. However, about 40% of the wealth management employees promoted overall — including the operations and legal staff — were women, a Morgan Stanley spokeswoman said in response.
Wake-up call: Overstock’s move into female-focused robo-advice should be a wake-up call to the wealth management industry, says April Rudin, founder and CEO of The Rudin Group. Overstock.com is going after a different target investor than traditional wealth managers, “yet that is exactly the problem,” Rudin says. “Traditional financial advisers should be targeting middle- and upper-middle-income females — not as a niche, but as people.”
Gender pay gap loophole: Virgin Money CEO Jayne-Anne Ghadia and Lloyd’s of London insurance market chief Inga Beale are outraged by firms skewing their gender pay data by excluding their highest-paid partners from it. Equity partners at law, accounting and consulting firms — which pay some of the most generous salaries and whose partners are mostly men — are considered owners rather than employees, which allows the companies to omit them from their data sets and skew the results. The loophole has created fears that the exercise of U.K. companies with 250 employees or more disclosing their gender pay gaps by April 4 could be compromised. “Why would they provide a carve-out for a certain group which would tend to be senior, the most highly paid and the least gender balanced?” Beale asked. Some companies are creating subsidiaries to keep staff numbers below 250 too, Beale said. “Let’s hope we haven’t got people hiding and fudging things by finding loopholes. All businesses have to think long and hard, alongside the government, as to whether this is really sharing a true and fair picture of everything that’s going on.” Lloyd’s has reported a gender pay gap of 27.7%.
The bonus gap: Royal Bank of Scotland’s female employees earn an average of 37.2% less than their male counterparts. Its solution: promote women. “We need to have more females in senior roles,” said RBS CEO Ross McEwan. “That’s what fixes the gender pay gap.” Women make up 37% of the bank’s top three layers of management; a ratio expected to grow to 40% by 2020. RBS is aiming for “gender balance at all levels” of the business by 2030. RBS’ analysis of bonuses also shows a gender gap, with that average being 64.4%. However, the median bonus gap is 36.6%, suggesting that the average is skewed by big outliers.
Role call
Dina Powell, a former deputy national security adviser to President Trump, is returning to Goldman Sachs as a member of its management committee. Powell was a partner at Goldman and its global head of impact investing until she was tapped for a White House post at the start of the Trump administration. Earlier this month, she also became a non-resident senior fellow at Harvard University, as noted here.
American International Group is appointing Donna DeMaio as its global chief operating officer for its General Insurance business, subject to regulatory approval. DeMaio, who has appeared on our Most Powerful Women list in the past, currently serves as senior managing director of Asia Pacific Internal Audit and chief auditor at the global insurance company. The new role is based in New York, and her appointment is effective March 15. She will be responsible for improving operational processes, driving the technology strategy and leading project management across the global General Insurance business. She also will lead the business’ shared services, procurement and real estate functions.
American Express is promoting Linda Zukauckas to deputy CFO overseeing its Business CFO Group. She will succeed Paul Hough in the role, effective March 19. Zukauckas, who currently serves as corporate controller at Amex, is one of the leaders of its women’s colleague network, called WIN, and helps run a variety of programs for women looking to advance their careers.
Cardlytics has named Shannon Johnson group president of financial institutions. Johnson was previously head of consumer direct lending at SunTrust. In her new role she will help Cardlytics, which builds rewards programs, expand its bank partnerships. The firm already has a partnership with SunTrust, which Johnson helped develop.
Eastern Bank in Boston has promoted Kathleen Henry, its general counsel and corporate secretary, to executive vice president. Henry joined Eastern in 2016 from Plymouth Rock Assurance, where she was general counsel.
Capital One has appointed Google’s Aparna Chennapragada to its board of directors. Chennapragada, who leads product development for Google Lens, is a frequent public speaker on artificial intelligence, machine learning, and mobile strategy. “Her experience at one of the world's most innovative companies will help us continue to accelerate Capital One's technology and digital transformation," Richard Fairbank, the chairman and CEO of the McLean, Va., company said in announcing her appointment.
Investors Community Bank in Manitowoc, Wis., has appointed Vicki Leinbach to its board of directors, citing her technology background. Leinbach, who is the chief information officer at Ariens Co., also will be nominated in May to serve on the board of County Bancorp, the bank’s parent company.
Beyond banking
Undermining behavior: Do white male employees start acting like bigger jerks at work when a woman or minority becomes the boss? This study says yes.
Reevaluating: On the 20th anniversary of the Starr investigation, Monica Lewisnksy wrote for Vanity Fair about her traumatizing experience in the national spotlight. She said the #MeToo movement helped her recognize President Clinton’s “gross abuse of power” in having an affair with her. “Now, at 44, I’m beginning (just beginning) to consider the implications of the power differentials that were so vast between a president and a White House intern,” she said. “I’m beginning to entertain the notion that in such a circumstance the idea of consent might well be rendered moot. … Power imbalances — and the ability to abuse them — do exist even when the sex has been consensual.”
21 in 21: A New York City initiative called “21 in ’21” is working to elect 21 women to the city council within three years. They currently hold 11 of the 51 seats (though only four have terms that extend long enough to help meet the 2021 goal). Getting more women on the council, which directs an $88 billion budget, is viewed as a first step to putting women in the pipeline to run for governor, the state legislature, Congress and even president.
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Check out last week’s newsletter – which included items about Irene Dorner of Virgin Money and Amber Baldet of JPMorgan Chase — here.
