The Reason High Finance Needs More Women

Research shows gender diverse teams are better at critical thinking. Good that Sebi has a woman chief

- Richa Roy

The Financial Crisis of 2008 – a seismic event whose aftershocks we continue to experience – was widely believed to be a black swan event (even though it was perhaps actually a grey rhino) and unforeseen by most experts and regulations. And yet, Brooksley Born, a woman and lawyer, chair of the US Commodity Futures Trading Commission (CFTC), an important financial markets regulator, did predict and seek to address one of the fundamental causes of the crisis – unregulated OTC derivatives – 10 years earlier in 1998. A Harvard Business School case study and Washington Post profile of this Cassandra document how she proposed to investigate and seek market feedback regarding OTC derivatives recognising their benefits as well as risks and propose possible regulation on capital requirements and enhance counterparty creditworthiness.

Although the other all-male regulators – Greenspan and Summers included – discredited her concerns (and her) and laughed them away (claiming, ironically, that regulating OTCs could cause the worst crisis since World War II), these came to pass in the most calamitous manner.

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