Janet Yellen’s appointment as Federal Reserve chair this year was hailed as another step toward gender equality. How about a central bank where women outnumber men?
This is the Bank of Thailand (BoT), which runs monetary policy in Southeast Asia’s second-largest economy and has 31 women among its 60 top executives.
Thailand named its first female central bank governor in 2006 and its first female assistant governor back in 1966.
The secret of the bank’s success in gender equality starts at the lowest level and goes back decades.
Tarisa Watanagase, governor from 2006 to 2010, was a beneficiary of a scholarship program to study economics abroad that began in 1960. Of the 85 interns accepted for the Bank of Thailand’s three-month summer programme this year, 58 were women.
“My dad said the BoT would be my best option because it had the best opportunities for women,” said Roong Mallikamas, who joined the BoT in 1995 after completing a PhD in economics at Massachusetts Institute of Technology in Cambridge, Massachusetts.
In October, she became head of the bank’s macroeconomic and monetary policy department.
The half-century policy of hiring and promoting women has given the Thai institution a head start over more powerful central banks in developed nations.
The US Federal Reserve has two women, including Yellen, on its board and two female presidents out of 12 among the regional Fed banks.
The Bank of Japan has one woman on its nine-member policy board, while the European Central Bank has one woman on its six-member executive board and two on its 24-seat governing council.
Opinion diversity
The Bank of England named a second woman to its nine-member Monetary Policy Committee this year.
Before their appointments, Governor Mark Carney said that a gender imbalance previously was “striking” and the Bank of England (BoE) needs to nurture female economists “through the ranks.”
Of the 3,617 employees at the BoT, 54 per cent are women.
Having women in senior roles in central banks “is important to have a diversity of opinion,” said Caroline Freund, a senior fellow at the Washington-based Peterson Institute for International Economics and a former World Bank economist. “Otherwise there is a danger of ‘group-think,’ where they may miss important risks because they all come from the same backgrounds, hold the same priors, and examine the same data.”
Tarisa, who has a PhD in economics from the University of Washington, was responsible for devising and implementing financial sector and supervisory reforms after the 1997 crisis, and modernized the nation’s payment system. She imposed capital controls in 2006 to rein in a surging baht and fight flows.
Role models
“Women have played an important role in the Thai central bank for more than half a century now, becoming role models and drawing more women to the central bank,” said Pongsak Luangaram, who teaches monetary policy at Chulalongkorn University in Bangkok and wrote a book on the Bank of Thailand. “It came to be regarded as a prestigious place to work, and began to attract the cream of economics graduates.”
Chulalongkorn University, where diplomas are still presented by the royal family, says 69 per cent of students enrolled in its English-language undergraduate program in Economics this year are women. At the central bank, more women than men hold PhDs – 52 per cent, up from 36 per cent in 2004.
“Education is really key to the achievement of women in Thailand,” said Kesara Manchusree, president of the Stock Exchange of Thailand, and the third woman to hold that position. “There are also no social expectations that women should stay home to raise kids after marriage.”
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Suparb Yossundara joined the Thai central bank as early as 1947, rising to the position equivalent to assistant governor in 1966, the highest possible at the time as the governor and his deputies were appointed by the government. Tanya Sirivedhin became the first female deputy governor in 1998.
“It’s not at the central bank alone; there are lots of women working at banks and other financial institutions also,” said Navaporn Reuangsakul, who studied economics at the University of California at Los Angeles with a scholarship from the BoT, and returned to work there for 18 years. “So it’s more about our society and the environment in our country that are supportive for women to work and advance their careers.”
Other central banks in Southeast Asia have also promoted women to top posts. Tan Sri Dr Zeti Akhtar Aziz is in her 14th year running Bank Negara Malaysia, where women make up 38 per cent of senior management, while in the Philippines, three of six assistant deputy governors are women.
Limited flexibility
“The inclusion of women in the financial and economic mainstream is no longer an option,” Zeti said in Bangkok in July. “It’s a prerequisite for our sustained economic progress.”
Asia’s more advanced economies have been slower to tap the skills of women. The Bank of Korea appointed its first female deputy governor last year, while Sayuri Shirai, named to the policy board of the Bank of Japan in 2011, is its sole woman.
Around the world, 19 out of 190 central banks and monetary authorities were run by women as of Oct 6, including Russia, Ukraine, South Africa and Israel, according to Central Bank News in Boulder, Colorado. Most are in smaller economies such as the Seychelles, Honduras and Cyprus.
“Many developing countries do not have fully flexible exchange rates,” said Freund at the Peterson Institute.
“This means the central bank plays a much less important role in the economy because monetary policy flexibility is limited.”
Graduate pipeline
Equality in the central bank doesn’t necessarily translate into equal opportunities elsewhere. In many Southeast Asian countries women face challenges in accessing educational, economic and political opportunities, according to the World Economic Forum. In the region, only the Philippines made the top 10 of the WEF’s 2014 gender gap index of 142 countries. Thailand comes in at 61, while Malaysia is 107.
In politics, Thailand has gone backward in gender equality since the military coup in May. Former Prime Minister Yingluck Shinawatra had three female ministers including herself, and women held 82 of the 492 seats in the lower house. Of the 220 seats in the new military-appointed National Legislative Assembly, 13 are women.
Still, at university the pipeline of female graduates keeps flowing: last year, 134 Thai women enrolled in college for every 100 men, World Bank data showed. Thailand, along with the Philippines and Indonesia, also has among the highest ratios of women in senior management positions — at least 38 per cent, compared to a global average of 24 per cent, according to a report by Grant Thornton International Ltd.
That’s at least in part due to the strong family networks and affordable domestic help in Southeast Asia.
“I had a lot of family support for raising my child,” said BoT’s Roong, 45, whose PhD thesis was advised by Olivier Blanchard, now chief economist at the International Monetary Fund. – Bloomberg