Lucky for all of us, some people just don’t know when to quit. They see a problem, decide to fix it, and once they do, they’re already asking themselves, “Ok, what’s next?”
That’s Ajay Banga, CEO and President of Mastercard and Ellevest backer, in a nutshell. He saw that many women around the world didn’t have bank accounts, so he partnered with the World Bank in order to help millions gain access to financial tools and services. After spotting differences in salary between men and women doing the same work, he set out to close the gender pay gap at Mastercard. Now he’s helping Ellevest in our efforts to close the gender investing gap.
As the head of one of the world’s biggest payments-related technology companies, Ajay’s leadership in solving these problems matters. A lot. He and I sat down in New York to discuss why he’s committed to helping women gain greater access to money and how advocating for inclusion — whether it’s greater diversity at work or more financial opportunities — really comes down to basic dignity.
Why do you think a lack of gender diversity amongst executives is a problem?
You need to have around you people who won’t have the same blind spots as you because they come at things differently.
If half the world’s population is female and purchasing decisions are made 70% of the time by females, you should be caring deeply about having people around you who understand how women think, operate, use things, approach issues.
So, in so many different ways for your own success as a manager, but also for the success of your company as an economic enterprise, it’s a really smart thing to surround yourself with people who are different from you. Since I am a man, it kind of strikes me: It’s a really good idea to have women around me.
How do you think we can get more women executives into the top level of companies? And how have you done it in Mastercard?
Getting the right representation of females in the higher level of a management organization is a really hard thing. Even in our company, if you look at the pyramid we’ve got, and when you look at the representation of women at the lower level, it’s a much better representation. By the time you get higher up, it begins to fall off.
Part of that has to do with this mid-career issue of having children...One of the things we’ve done for that is to actually extend maternity leave to 16 weeks paid, with no impact on your bonus, no pro rata — you get the year’s pay.
Second, we’ve given paternity leave...that to me is a step forward, and it’s a good step. There are many other things you can do, which we’re doing, which is to allow them to, in fact, encourage them to bring their kids to work while they’re off from work for a few months. So, the connectivity with their colleagues and their pals remains, and they’re not away for six months and suffer a lack of confidence when they come back, say, "Whoop, everybody else moved on and I got left in a different space."
All of that changes the mid-career issue...this mid-career thing of providing the right opportunity to come back is the best way to get [women] up the ladder.
What I don’t want to do is to ever make somebody feel that they got that job because they look different. Because I do, and if somebody ever told me that that’s why I got my job, I would leave that company in one second. My self-respect is as important as the opportunity I get because it’s not just an economic opportunity; it’s a whole mental thing of getting the opportunity for the right reasons.
So, I’m very clear to people: Give people the opportunity for the right reasons.
How do you attack the gender expectations and biases that exist in men and women, where it’s easier to perceive a man as a leader, where it’s just easier to promote a man because they look like us?
To give you an example, I was talking to our graduate program entries for 100-plus people just a day before yesterday...When I did my Q&A with them, I answered eight questions. I took six from women while pretending to be choosing randomly. The idea was to get them to raise their hand and see that if you do raise your hand, and if you do ask a question, you will get exactly the same attention that you deserve for the quality of your question.
...It’s a series of things that you've got to do. You’ve got to believe in this idea of diversity is your best friend as a manager.
Okay. So, the gender pay gap at Mastercard is how big?
There is no gender pay gap in Mastercard. How in the world did you close that puppy?
We started studying the data. I got my HR head — who had to pull out for me data about the female population versus the male population. Then, very quickly, you encounter that there aren't enough [women] in the same levels of management. So, you start getting deeper and deeper into the detail.
Once we actually sorted through to start looking at people who got promoted or joined or entered a level at the same time, what did they get paid, and then segregate that from what happened if their performance scores were different — which is another topic altogether to deal with — I began to find very few real anomalies in the company.
When there were — and I did find some — I immediately went in and corrected their comp, called their manager and said, "You need to know that while you may not have had this lady work for you for the last five years, I’m wondering why you didn’t do this before I did.“
Once you make five of those calls, it’s like the monkey mail. It spread throughout the company, saying, ”He’s gonna call you.“
I would imagine...
I have come to the conclusion, the best thing you can do is to do this: Spread the news by making those calls. You set the example once or twice, and then it starts energizing others because this is not a one-person thing. You need everyone to get onto the bandwagon here. But it's harder to do the second one than the first one.
I agree. So, you partnered with the World Bank to help women worldwide gain access to financial networks. What inspired you to become such an advocate for increasing women's financial opportunities? Because, again I'm noticing you're not a woman.
Oh, you did.
There are about 2 billion people in the world who don't have an identity. A very large number of them are women. If you don't have an identity, by the way, nobody cares about you. No one comes to you when governments conduct questionnaires to figure out what they aren't doing well in something...an identity is a pathway to decency and being seen and being noticed.
I learned that by stumbling into it through a social security program in South Africa that we did as a business. We basically said, "Oh, we'll find a way to help the South African social security agency pay their benefits in a way that didn't involve cash," which leads to what the NGOs call leakage — which I call theft. To get in between that, we said, “Instead of cash, put it on a card.” Take Sallie's biometrics; she can go and use her fingerprint and get her cash. That way, she's not vulnerable to being exploited with that cash being taken once a month.
When I went to see some of the recipients, they took me to meet a lady called Hilda, who was 77 years old. She pulled out a card from inside her dress and said, "I keep this with me. This is my dignity." I couldn't understand what the heck she was saying. Once she explained everything to me, her identity, the fact that the person she was staying with could not beat her to get access to the money, I suddenly realized that there's more to life than just inclusion — there's just basic dignity.
Why do you believe it's important for a business to take on this role [of creating opportunities for women]?
I think there are two reasons why business has to be involved with transforming the opportunities women get. The first one is an obvious one because, remember, 50% of the population is women. If you're in the business of making and selling things to people, well, you're only selling to half if you aren't ensuring that the other half have access and capability and spending power and all those things.
But the second part is, I learned long ago, that if you make a woman economically independent and, more importantly, therefore socially independent, she actually uses her independence in a very different way from the average man in many places. The first thing she does is put the money back into her kids. It'll normally be a better school, a light to study at night, drinking water by a tap instead of being fetched in a bucket. It's stuff that makes the kid have a better life. And very quickly it becomes about the family. So, if you get the woman to be socially independent, that family improves.
Generally, if you're in the business of selling in a community, improving families is a really good idea for you. So, it's all self-interest in the first hand, but it's knowing that you can do all of that and do good at the same time.
It's one of the rare win-win in many ways...
It absolutely is.
Why did you invest in Ellevest, and how do you hope to help women advance?
The idea that Ellevest represents is actually the core of what we've been discussing, which is to recognize women for being who they are with a unique set of needs. It may be that they tend to live longer, that they tend to earn less because that's the way society has treated them, and therefore that having the ability to plan for a longer life with lower earnings. It means you've got to think differently from the beginning. Albeit a number of them tend not to do that thinking, and therefore you need a catalyst that'll make it happen; albeit that if you do all that well, life is actually better for everybody.
The information provided should not be relied upon as investment advice or recommendations, does not constitute a solicitation to buy or sell securities and should not be considered specific legal, investment or tax advice.
The information provided does not take into account the specific objectives, financial situation or particular needs of any specific person.
Diversification does not ensure a profit or protect against a loss in a declining market. There is no guarantee that any particular asset allocation or mix of funds will meet your investment objectives or provide you with a given level of income.
Investing entails risk including the possible loss of principal and there is no assurance that the investment will provide positive performance over any period of time.