ECB to make history - if its next top recruit is a woman

Frankfurt

THE next appointment to the European Central Bank's (ECB) executive board could turn out to be one of the most consequential for diversity in its history - if only governments might oblige.

Putting one more woman on the top team, which designs the monetary policies that drive the euro zone economy, would make half the six-member panel female and place the institution on a global pedestal for progress and equality.

The chance to make that happen - and the last one for half a decade - will emerge when Yves Mersch leaves the board in December. To ensure timely ratification of any candidate, the process by governments to select his replacement will probably start this month.

ECB president Christine Lagarde has made no secret of her push for diversity at the Frankfurt-based ECB. It is not clear whether she is privately lobbying for such an historic first though, as the selection of her executive team is out of her hands. It is made by the bloc's finance ministers, and their priorities may be different.

Just as with her own appointment last year, high politics will determine Mr Mersch's replacement. Since citizens of the euro's four biggest economies already serve on the board, the vacancy creates an opportunity for smaller countries, such as those in eastern Europe, to win that prize for the first time.

The problem there is similar to the challenge that faced leaders when they plucked Ms Lagarde from the helm of the International Monetary Fund to succeed Mario Draghi at the ECB as its first female chief.

Her appointment was both a triumph for diversity and an expose of the dearth of women in the management of the region's central banks, the normal breeding ground for promotion to the ECB.

That situation has not changed. No governor in the 19-member region is currently female, meaning the only women on the Governing Council are Ms Lagarde and Isabel Schnabel, the German member of the executive board.

The diversity in eastern Europe is just as lacking. The management of all five euro-member national central banks there are predominantly male, with Slovakia's board consisting only of men.

The result is that hardly any woman is being linked by observers to the race. One exception is Joanne Kellermann, whose career already broke new ground when she formerly served as the first female board member of the Dutch central bank.

What Ms Lagarde's appointment still showed is how determination by governments to fix the balance can achieve much in a short time. After her own appointment in November, Ms Schnabel joined the board to bring the number of women there to an unprecedented total of two.

If Ms Largarde does want to lobby governments, one opportunity could arise when she writes to them imminently asking for a new board member. Whether she makes that case, and whether it will be heard, could affect the race in the weeks to come.

Even if governments do appoint a woman, it would only mark another milestone in a long journey to gender balance at the ECB. Aside from the governing council's almost exclusively male membership, the institution itself has partially failed to meet its own long-term diversity targets. BLOOMBERG