This post originally appeared on Levo League.
Well, it just got even tougher for women on Wall Street.
According to a new study by the American Economic Association, connections help men get ahead on Wall Street but they don’t help women in finance. Investors simply don’t trust women as much as they do men — right off the bat at least. Add this to the double-standard trunk.
The study says for men in finance, all it takes to earn an investor’s trust is the right connections — not whether you are actually good at your job or not. But for females in finance, six-degrees-of-whatever does diddly to impress investors. For the ladies on Wall Street, it is all based on performance.
Basically women have to work a lot harder to earn the same amount of trust because men have it built-in with the Wall Street Boys’ Club. Mike Young wrote for PolicyMic, “There’s almost an instinctual relationship where investors trust men more despite having less or little evidence to do so, and yet this seems to correlate with better results.”
He points out that because of this, women mostly earn trust based on their merit. This is why you will find so many more women than men with Ivy League degrees on Wall Street. A female entrepreneur told me this preference for men over women isn’t exactly malicious, but just natural. “I think it is that thing how you are more comfortable with people who are like you, rather than an intentional, ‘I don’t want to help women!’,” she told Levo.
But this shows that women will continue to be kept in the minority in finance. In the U.S., women account for only 2.7% of the chief executives in the financial industry, and 16.8% of the executive officers, according to a study by Catalyst. An entry-level male analyst is more likely to start his career off better because he was in the same eating club at Harvard as so-and-so’s cousin at Goldman Sachs, but the entry-level female analyst with the degree from Yale may get overlooked because she lacks those connections.
According to the latest Mergis Group Women in Finance survey, less than half of women in accounting and finance (48%) are satisfied with the progression of their careers, and nearly three-quarters of women in accounting and finance believe they face a dissimilar set of obstacles as opposed to their male counterparts Elle Kaplan, CEO and founding partner of Lexion Capital Management, told me: “This is a clear double-standard. As a woman who has always worked on Wall Street, we are constantly in a fish bowl.”
This is a major problem and will not help more young women want to enter a career in finance if they have no female mentors to look up to. Deal Journal writer Shira Ovide summed it up best when she said, “Senior female executives on Wall Street are like bald eagles: Majestic, but extremely rare.”