David Prosser: The bubbles should have gone flat long ago for Veuve Clicquot's awards
The endurance of the Veuve Clicquot awards underlines why it was a mistake to reject thecase for compulsory quotas for women on boards of directors
Tuesday 29 March 2011
Congratulations to Michelle McDowell, who was crowned the Veuve Clicquot Businesswoman of the Year last night. But doesn't it say everything about the failure of companies large and small to promote women to senior posts that this award still exists?
Veuve Clicquot first came up with the idea of this awards scheme in 1972. "Each year tells the story of inspiring women who are high achievers in business life," the company explains. "Theirstories are an encouragement and motivation to younger, aspiring women."
That's the point. That we still need to make a big deal aboutsuccessful women in business in order to encourage and motivate those who aspire to follow them instantly tells you two things: that there aren't enough of these success stories and that young women need special encouragement because they face more obstacles than their male counterparts. There is something deeply depressing about the idea that almost 40 years after this award was launched, successful businesswomen still need some sort of extraordinary recognition. Had Britain done a better job on equality of opportunity, this is an award that would have seemed anachronistic many years ago.
One of the speakers at last night's awards bash was Lord Myners, the former City minister. No offence intended, but it would have been more interesting to hear from his old ministerial colleague Lord Davies, whose report into how to increase the number of women serving in the boardrooms of Britain's largest public companies (a narrow proxy for women in business, but a start) was published a few weeks ago. The inquiry's proposals included many decent ideas, but fell short of the one reform that would have guaranteed a step-change in female representation at the highest level of British business – the introduction of compulsory quotas for women directors.
The endurance of the Veuve Clicquot awards underlines why that was a mistake. We have now been talking in this country about building a business environment in which women can thrive for four decades. And until we force companies to ensure that more women rise to the top, we'll go on having to do such talking.
Many businesses, including some run by women, object to quotas because they believe there are insufficient numbers of women with the talents and experience required for the posts that would fall vacant were they suddenly to have to ensure that, say, 30 per cent of directors were female.
If that is the case, we should ask why women of such calibre are in such short supply. All but the most unreconstructed of business leaders are rapidly going to conclude that the only answer can be that there must be barriers that damage women's career prospects long before they get to the position of being considered for board-level jobs. And what might force companies to begin addressing thosebarriers? Well, being presented with a choice between having to appoint mediocre candidates to the board or falling foul of a legally-binding quota would certainlyconcentrate minds.
The banks remain one step ahead
With less than a week to go before the end of the tax year, Consumer Focus published a timely study into the cash individual savings account (Isa) market yesterday: it warned that two-thirds of savers who open an account offering an introductory bonus rate of interest fail to switch to a new provider once the deal comes to an end. The alert is another example of how the developing relationship between the banking industry and its customers continues to be fraught.
It is now more than 20 years since people first began to wake up to the idea that banks did not always offer their customers the best possible deal. That realisation seeded the growth of what has become an industry in its own right, with all sorts of interest groups competing to help consumers make better choices.
Not least, the media recognised its responsibilities and newspapers, including The Independent, began to publish best buy tables. The online price-comparison industry soon followed. Naturally enough, it did not take long for the banks to recognise such developments – and their attempts to game such tables continues to this day.
The introductory bonus trick is a variation on a gimmick seen across the financial services sector. It is deceptively simple – a high headline rate of interest ensures a best-buy table appearance, but the rate expires after a fixed period and then becomes much less attractive – but very difficult to legislate for in commoditised analysis such as a best-buy table or a price-comparison service.
After all, on Consumer Focus's figures, a third of cash Isa savers recognise what their account provider is up to – and have the sense to move on once interest rates fall back. Stripping bonus rates out of comparisons would be a disservice to savers who are getting the best out of the system, in order to help those who are not. Even pointing out the trap in the small-print doesn't seem to work: savers tend to start with the best of intentions, promising themselves that they will switch, only to fail to do so when the time comes several months later.
It is difficult to know how to solve the problem. Banks are already duty-bound to remind customers their introductory offer is coming to an end, so this is not a question of improving disclosure rules. Nor, in the end, can you force consumers to overcome their apathy. Anyway, were everyone to do so, the introductory bonus would presumably disappear, since the economics of the game only work when there are enough customers on the losing side.
Encouraging competition – such a noble idea in principle – is a difficult practical exercise.
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