FINANCE Bloomberg Businessweek December 23, 201933PHOTOS: BEALE: CHRIS J. RATCLIFFE/BLOOMBERG. STOWELL: EVA O’LEARY. DATA: BANK FOR INTERNATIONAL SETTLEMENTS, FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL
Jeanne Christensen, a partner at the employment
law firm Wigdor LLP, whose clients have fought
major banks and hedge funds. “Going up against
them is not the same.” Some finance executives
even reacted to #MeToo by steering clear of their
female colleagues, as if they were the problem.
Journalists who write about the landscape of Wall
Street often first encounter its self-protective mech-
anisms when they try to report on its bad behav-
ior. In the earliest days of #MeToo, when women in
finance quietly shared stories about being grabbed,
propositioned, and kissed out of the blue, most said
they had too much to lose if they spoke out. In the
cases when women were prepared to talk openly,
Wall Street’s public-relations specialists jumped
into action. They told reporters not to trust these
women—in one recent case because she was flirty,
in another because she was too aggressive, in a third
because she’s past her prime.
Then there’s an arm of the system that tries to
prevent workers from speaking out in the first place.
At the 331-year-old insurance exchange Lloyd’s of
London, a woman who says a senior manager
drunkenly attacked her in a pub was convinced by
HR that it would be bad for her career to pursue a
grievance. At London’s M&G, which manages about
$450 billion, when a woman complained about a top
money manager, HR told her to smile less around
him and dress more conservatively. Christensen,
the attorney, says most of her Wall Street clients
feel they can’t even go to HR.
The few women who try to sue are sent
behind the closed doors of the arbitration system.
Brokerages helped pioneer the shadow legal process
decades ago by winning Supreme Court cases that
allowed the practice to spread to corporate America.
Now, workers at 2 out of 3 big nonunion companies
are bound by mandatory arbitration. It spares com-
panies from the embarrassment and cost of law-
suits, while keeping victims from learning about one
another and banding together. It also gives employ-
ees worse odds of winning, and smaller judgments
if they do, says Alex Colvin, who teaches dispute
resolution at Cornell. Several tech giants have
stopped making employees sign away their right to
sue over harassment, but the finance industry isn’t
budging from a system it says is cheaper and quicker
but fair.
Lee Stowell disagrees. She’s fighting to stay out of
arbitration. The bond saleswoman sued her former
firm, Cantor Fitzgerald, saying she put up with years
of locker-room behavior and lost her job when she
complained. The brokerage argued that she had to
keep her complaint behind closed doors, and the
two are currently tangled in a battle over whereshe’ll get to air her grievances. (In March, a judge
sided with Stowell; Cantor denies her allegations
and is appealing.)
Unlike other industries, Wall Street has a self-
regulatory arm that runs its own arbitration
hearings; judge and jury are replaced by a small
panel of decision-makers, mostly white and male.
Transcripts of a case between a risk specialist and
the big bank he used to work for showed an absurd-
ist maze. One arbiter fell asleep, another left for the
bathroom at a key moment, and lawyers bickered
over a granola bar. There’s less testimony, fewer
documents, and rarely an appeal. “We shouldn’t
lose sight of the fact that the system was invented
by firms to protect firms’ own interests,” says David
Noll, a Rutgers Law School professor who studies
legal institutions.
No woman has ever held the top job at any of the
six biggest U.S. banks. But even the single most pow-
erful person at Lloyd’s was no match for a culture
older than the U.S. itself. When Inga Beale, the first
woman to run the insurance exchange, pushed to
modernize its sexist attitudes and boozy behavior,
men asked one of her friends to have Beale “tone it
down.” One anonymous note sent to the chief exec-
utive officer’s sixth-floor desk told her to “go and
die”; another message said she should stop talking
about her bisexuality. Beale left and was succeeded
by a man who’d married one personal assistant and
then began a relationship with another.
Fisher eventually apologized for his comments
and said they were misconstrued. Looking at it one
way, the trouble he got into was a fluke, and the bil-
lions of dollars of withdrawals were just a slap on
the wrist for an executive who’s still running the
company. But it could also mark the beginning of
a cultural shift. At BlackRock Inc., CEO Larry Fink
told the company’s 20 or so highest-ranking officials
that their behavior was being held to a higher stan-
dard. Two of the men in that group are now gone.
The world’s largest asset manager fired them, one
just this month, for breaking rules about relation-
ships with colleagues.
There was a brief window this year when it felt
like a lot more was about to change. In July, the mil-
lionaire financier Jeffrey Epstein stepped off his pri-
vate jet and was arrested on charges of sex trafficking
underage girls. As he sat in prison, it seemed his
case was about to trigger a reckoning for the major
Wall Street figures who’d embraced and enabled
him. Instead, he died. —Max Abelson and Katia
Porzecanski,withSabrinaWillmerandGavinFinch○ Beale○ StowellTHE BOTTOM LINE Wall Street is dominated by men, and things
like forced arbitration have helped it stifle women and maintain its
frat house culture.