Jane Fraser made history today with the news that she will become the first woman to head a major US bank. The Scotland-born McKinsey consultant turned financial executive will succeed Michael Corbat as CEO of Citigroup, the third-largest US lender, when he steps down in February from the role he’s held for eight years.
Among Wall Street insiders and spectators, Citigroup’s announcement was met with a mixture of excitement (a glass ceiling finally shattered) and impatience (it’s about damn time). As Rob Blackwell, the chief content officer for Promontory Interfinancial Network and my former colleague at American Banker, told the New York Times: “It’s frustrating that this moment has been so long in coming.”
Fraser, who was promoted to president of Citi and CEO of global consumer banking last year after overseeing the bank’s Latin America operations, had already generated buzz as a potential successor to Corbat. But those who have been paying attention to the push for greater gender diversity among big-bank leadership may find it interesting to note that it is Citigroup, rather than JPMorgan Chase, that reached this landmark first.
JPMorgan, after all, has positioned several women executives, including Marianne Lake, Mary Callahan Erdoes, and Jennifer Piepszak, as potential contenders for the CEO title when its current chief Jamie Dimon retires. But Dimon, who is now 64, said in April 2019 that he expected to stay with the bank for another four or five years, meaning that any chance of a woman taking the helm remained a ways off.
Corbat, age 60, also had been expected to stick around for a few more years, according to a 2019 Bloomberg story about Fraser. But the profile also noted that “competitors’ interest in Fraser,” whose name had come up during CEO searches at HSBC and Wells Fargo, “raises the risk that Citigroup will lose her if she doesn’t continue to advance.” While it’s unclear why Corbat chose this moment to step aside, the end result is that Citigroup went ahead and put a highly qualified woman in its most prominent position of power, while JPMorgan still has its top women executives waiting in the wings.
There’s a lesson in this for Wall Street—which has an established pattern of deeming women on the path to CEO-dom “not quite ready,” as Claire Zillman noted in Fortune last year—and for every other company that’s been slow to make inroads in creating diverse leadership teams.
Research shows that women are often over-mentored and under-sponsored; that is, they get feedback that helps them understand their working styles and how to improve, but they’re less likely than men to be put forward for jobs at the highest level. “Women are still perceived as ‘risky’ appointments for such roles by often male-dominated committees,” London Business School professor Herminia Ibarra and two co-authors at Catalyst, Nancy M. Carter and Christine Silva, explain in the Harvard Business Review.
Of course, every big promotion involves taking a chance on someone. But many women find that their own employers are constantly raising the bar as to when they’ll finally be ready for their big break—and that they’re expected to stick around with endless patience and loyalty in the meantime.
Fraser’s appointment at Citigroup shows that there’s a point at which companies simply need to trust that women who’ve spent years demonstrating their competence and capability are ready to take the lead. And Corbat’s exit, meanwhile, is a reminder that in order to make space for women and people of color at the top, some white men have to be willing to step aside.