Are Women Really Risk Averse?
The conventional wisdom is that women are more risk averse than men and so might have been less likely to promote and support the kind of risk-taking culture that seems to have led to the current financial crisis. However, research conducted at the Center for Gender in Organizations at the Simmons College School of Management in Boston suggests that this conclusion needs to be seen in a more nuanced way.
By the standard means of testing, women do seem to be more risk averse when making risk/reward trade-offs. But when risk is understood more broadly, women seem as likely as men to take risks like launching new products or starting new projects.
Certainly, some of the bankers who oversaw the development of the now-demonized financial
products were women -- like Zoe Cruz at Morgan Stanley, for example -- although they are obviously not as well represented in those ranks as their male colleagues (holding less than 40 percent of the jobs on Wall Street). So from that perspective, we might not have seen any differences.
However, a further finding of the study is that women tend to take the broader context into account in making decisions that entail risk to them and their organizations and are more attuned to see changes in support for such actions. So it is possible that having women in leadership roles might have lessened the severity of the crisis, because women might have begun to appreciate its consequences sooner and as regulators they might have taken action more swiftly.
Posted by: rmorris391 | March 9, 2009 3:24 PM
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