Report: Performance counts more than connections for women on Wall Street

When it comes to climbing the corporate ladder, it's what you know for women -- and who you know for men

By Katie McDonough
Published January 5, 2013 2:37AM (UTC)
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The American Economic Association finds that it's more difficult for women to succeed on Wall Street than for men. What's more surprising is that they succeed in different ways: It's what you know that counts most for women and who you know for men (bold text mine):

Male and female analysts are equally connected on average. Connection is associated with more accurate earnings forecasts for men, but not for women. Controlling for accuracy, connection is important in explaining men’s, but not women’s, probability of being voted by institutional investors as “star” analysts, an important measure of career success. For women, education achievements and accurate forecasts are important factors that determine voting outcomes. This asymmetry in the effect of connections between the two genders does not exist in an alternative, computerized process of evaluating analysts, and is most pronounced among young analysts. Our results suggest that men reap higher returns from connections than women, and that investors are more willing to rely on soft information such as connections to evaluate men than women.

Lesley Daniels Webster, a former market risk manager for JP Morgan, has witnessed this kind of bias firsthand. As she told the New York Times recently, “Women in business often grow from the bottom up, learning all the complicated ins and outs rather than coming in at a higher level ...Women succeed by building a steady string of successes.”


Another possible reason why so few women can use connections to get ahead is a skewed gender ratio at the top -- only 3 percent of Wall Street's top executives are women. According to Daniels Webster, this means very few CEOs look at women starting out in the field and think, "Oh, she looks and sounds just like me at this age, so I’m going to have her move from division to division every three years so she can build up her resume."

h/t American Enterprise Institute




Katie McDonough

Katie McDonough is Salon's politics writer, focusing on gender, sexuality and reproductive justice. Follow her on Twitter @kmcdonovgh or email her at

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Economy Feminism Gender Gender Gap Jobs Pay Gap Wall Street Women's Rights