Wall Street Women Heading to Silicon Valley Could Narrow Gap
Is Ruth Porat Going to 'Blue Chipize' Google?
Bloomberg Business - March 25, 2015
(Bloomberg) -- Ruth Porat shows how Wall Street could help Silicon Valley solve its woman problem.
When Google Inc. tapped the 28-year Morgan Stanley veteran as its new chief financial officer, Porat became not only the latest from Wall Street to migrate to the technology industry but also the highest-ranking woman at the world’s largest Web search provider. Other tech companies need financial expertise and would benefit from an infusion of female talent as they face criticism about the lack of diversity in leadership ranks.
“They have no choice but to parachute in talented and proven women,” because there are so few in line for promotion to key jobs, said Pat Cook, president of Cook & Co., an executive-search firm in Bronxville, New York. While Wall Street has its own issues with gender diversity, “women who started careers there decades ago and pushed to advance are hot prospects now for technology companies.”
Tech companies tend to be male-dominated, and not only in the executive suite. Payroll data released last year by Google, Apple Inc., Facebook Inc. and others showed that Asian and white men hold the vast majority of highly-paid technical positions. Most of the companies are headed by men, most directors are men and the startup and investing environment favors men.
Other industries don’t look that much different, at least at the top. Porat, 57, spoke out about it last year, calling it an “embarrassment” that so few women run U.S. companies.
Women hold 24 of the chief executive officers jobs at Standard & Poor’s 500 Index companies and 58 of the CFO positions, according to the S&P Capital database.
Some of the female finance officers are at tech companies, including Microsoft Corp.’s Amy Hood, Cisco Systems Inc.’s Kelly Kramer and Oracle Corp.’s Safra Catz, who is also co-CEO.
Silicon Valley companies have been recently turning to Wall Street. Snapchat Inc. named Credit Suisse Group AG’s Imran Khan as chief strategy officer, and Twitter Inc. hired Anthony Noto, who had been with Goldman Sachs Group Inc., as CFO. And Porat’s not the first female tech CFO with a finance industry background: Square Inc.’s Sarah Friar worked at Goldman.
“Wall Street has much of the top talent still in the marketplace, and it’s certainly an area where you can expect people looking for future leaders,” said Nada Usina, who leads the CEO/Board Services practices for the technology sector in the Americas for Russell Reynolds Associates. “The women being put in these roles are extraordinary for their talent, and for how much they invest in helping move along those percentages” in an industry with a gender imbalance.
Gina Scigliano, a spokeswoman for Google, declined to comment.
The company’s announcement about Porat came just after closing arguments in a case that has captivated Silicon Valley and put its male-centric culture on trial. Ellen Pao, a former partner at Kleiner Perkins Caufield & Byers, sued the venture capital firm, claiming she was wrongly denied a promotion and faced retaliation for complaining about gender bias. She’s seeking $16 million in lost wages and future earnings. The jury is about to begin deliberations.
Porat has an undergraduate degree from Stanford University and graduate degrees from the London School of Economics and the Wharton School of the University of Pennsylvania. She went to work for Morgan Stanley in 1987.
In a speech last year to the Japan Society in New York, she recounted how after climbing the ranks she was shown internal performance review documents from when she started. Reviewers said she lacked stamina to get past the associate level, a junior rung. “I’m quite confident I outlasted the man who questioned my stamina,” she said.
Women tend to start at lower salaries at U.S. corporations than men and rarely reach the top posts that pay the most, she said, suggesting that lawmakers consider structural changes, such as requiring companies to provide family leave, so women aren’t forced to choose between careers and children.
“Women are still not reaching the most senior levels of corporations,” Porat said in the speech. “This is not a shortcoming of women.”
Martha Gallo, a former executive vice president and chief compliance officer at JPMorgan Chase & Co., said women from Wall Street would be open to overtures from Silicon Valley if they were offered jobs where “they have a place at the table, are listened to and have fun.” Plus there’s a key similarity, she said.
“Wall Street, like Silicon Valley, is a place where you can make money,” Gallo said. “If you’re going to work hard and be challenged, you also want to get paid.”
(A previous version of this story corrected the name of Stanford University in the 12th paragraph.)