Women of Wall Street Ask 'Who's Next' After Citi Picks Jane Fraser as CEO

(Bloomberg) -- Jacki Zehner, the first female trader to make partner inside Goldman Sachs Group Inc., was sitting at her kitchen table in Utah on Thursday morning when her husband told her he had good news: “Wall Street has their first female CEO.”

She was happy to hear that Jane Fraser will run Citigroup Inc.—mostly.

“To have a female at the top of a large financial institution is a step forward, but it’s a baby step,” she said in an interview Thursday morning. “Acknowledging that it’s never been true before, and it’s true now, is something to celebrate. That being said, it doesn’t mean that there’s systematic change. It represents one female.”

As congratulations rolled in across Wall Street for its newest boss, diversity advocates said the financial industry has a lot more to do to reach gender equality and pay equity. It's taken this long to appoint the first, and only, female chief executive officer at one of the biggest U.S. banks, and efforts to get more women into senior management have been slow to boost representation. 

The top groups of influential operating teams that oversee the six biggest U.S. banks are dominated by men. Women make up a third or less of those groups inside all of them except JPMorgan Chase & Co., where the gender split is even. In total, there are two men for every woman who sit in those powerful Wall Street spots. 

One of those women, Catherine Bessant, the top technology executive at Bank of America Corp., called the promotion “great news for the company and for women everywhere,” on Twitter, writing that it was “a big and fantastic moment.”

Last year, when a group of White, male bank bosses testified before a House committee, Representative Al Green asked if they thought their successors would look any different than them. None raised a hand. 

Green was encouraged by the news of Fraser’s appointment. “This was something that uplifted my spirits, knowing that there is still progress being made,” he said in an interview on Thursday. “Notwithstanding the fact that not enough progress had been made.” All of the top bank CEOs will still be White. 

“Jane’s appointment was the result of many years of investment for Citi,” said Lorraine Hariton, the CEO of Catalyst, a group that advocates for women in leadership. “It’s not just something you wake up and do overnight.”

With Fraser’s appointment to CEO, the 16-member Citigroup board, already the most gender diverse among S&P 500 banks, will become the only bank board that is evenly split by gender, according to data compiled by Bloomberg. The nominating and governance committee, which plays a key role in selecting the CEO, is also chaired by a woman.

There are 31 women who already lead S&P 500 companies, according to Catalyst. Having a woman heading up such a large bank will open up opportunities for others in the field, said Dina Powell, a former official in President Donald Trump’s administration who’s now a Goldman partner. “Her success and leadership will pave the way for women in finance,” she said. “A significant milestone. She has always tried to lift and empower women around her.”

Betsy Duke, who was one of the most powerful women on Wall Street before she stepped down as the head of Wells Fargo & Co.’s board this year, said Citigroup’s new boss “is the right woman at the right time, and Citi is the right company for her.”

Zehner, who’s now an investor, left Goldman more than a decade and a half ago and has seen change come glacially inside the big American banks. “To say it was slow would be an understatement. There has not been a lot of progress, despite a lot of awareness.”

Here’s what other leaders said about Fraser’s appointment:

Adena Friedman, president and CEO of Nasdaq Inc.

“Jane is an outstanding executive who is respected throughout the financial industry, and she is a superb choice to be the next CEO of Citi,” wrote Friedman, the first female CEO of a global exchange, in an email. “Her appointment as CEO also represents another significant milestone for women in the financial industry and across corporate America, and it sends an important message to all professional women—there are no limits to our capabilities and our potential.”

Christiana Riley, CEO of Deutsche Bank Americas

“The recognition of Jane’s competence and leadership is a watershed moment for meritocracy and equality that all women on Wall Street celebrate. This is clear recognition of the competence and leadership I’ve seen from Jane firsthand.”

Mary Mack, Wells Fargo’s CEO of consumer and small business banking

“It has been wonderful to see women rising through the ranks at so many banks, but today is an important first for women in the financial services industry. I am thrilled to congratulate Jane and hope this is the first of many examples of the progress we are making across the industry.”

Stacey Cunningham, president of the New York Stock Exchange

Betsy Duke, Former Wells Fargo Chair

“CEO jobs don’t come open very often. In the past the reason given for not choosing a woman was that none were ready. Jane is the first of many who are ready to step into these jobs now. I look forward to the day when selecting a woman to run a major company is commonplace rather than remarkable.”

Natasha Lamb, managing partner at Arjuna Capital LLC

“Citigroup is once again leading the way on gender equity, turning the boys’ club of Wall Street on its head. Let’s hope this is not just a one-off, but the beginning of a sustainable trend to increase diversity—both gender and racial—across the industry. Now, more than ever, we need strong leadership and resilient organizations that benefit from the innovation and out-performance diversity affords.”

Rachel Robasciotti, founder of social-justice investing firm Robasciotti & Philipson

“I’m delighted—and, at the same time, there is tremendous work that remains to be done across Wall Street in terms of equity and inclusion,” she said. The fact that Fraser will be the only top female banking chief, she added, is “shocking.”

Al Green, Democratic Congressman from Texas

Stephanie Cohen, Chief Strategy Officer at Goldman Sachs

“I am thrilled to see Jane Fraser take on the role of CEO at Citi. She is a true visionary who will continue to transform our industry.”

Mary-Caroline Tillman, head of financial services at Russell Reynolds Associates

“Jane is an outstanding executive in terms of her background and capabilities with a strong reputation for innovative, inclusive and sustainable leadership. She has earned the appointment as CEO of Citigroup and is an inspiration for other female executives to know that merit is recognized in leadership appointments. This is a special day and a milestone.”

Cynthia DiBartolo, CEO of broker-dealer Tigress Financial Partners

“This, in many ways, becomes an invitation to individuals who thought Wall Street was not for them or that they would never fit in. Diversity of thought at that CEO level on Wall Street has never existed before. Diverse companies are more innovative, they outperform their peer groups. I really started to well up and get that lump in my throat and thought, ‘this has been a long time coming.’”

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