It’s no secret that at banks across the country — big and small — most of the people sitting in the CEO’s seat or on the board have traditionally been men. Yet, some community banks have quietly redrawn that blueprint by offering workplace initiatives, such as family friendliness, flexibility and mentoring opportunities, which foster female leadership.
Shane Pilarski, president and CEO of Alliance Bank in Francesville, Ind., is one of five women on the bank’s seven-person leadership team. At Seattle-based Sound Community Bank, President and CEO Laurie Stewart strives to achieve diversity and inclusion throughout the bank’s staff. And, at Alerus Financial, with branches in North Dakota, Minnesota and Arizona, four of the five people on the executive team are women, as are 55 percent of its senior leadership council.
“For me, I’ve seen an enormous amount of change because I went from being a true minority in terms of gender to one of four females and one male,” said Kris Compton, executive vice president/chief strategy officer for Alerus, of the bank’s reorganization of its leadership structure several years ago.
Previously the senior leadership team was comprised of seven men and Compton. “I feel our organization works toward a balance. Yet when we set out to reorganize, we were very much driven by ‘we’re going to pick the right person for the job,’” Compton said.
Having the right person for the job, regardless of gender, is a goal enshrined at all three institutions.
About 60 percent of the people who work in banking are women, according to the U.S. Bureau of Labor Statistics. Women occupy about 48 percent of first- and mid-level management jobs in the financial services industry, according to a report from the U.S. Governmental Accountability Office, but they occupy only 29 percent of senior management positions. Those numbers were unchanged between 2007 and 2015, according to the report.
Alerus’s Compton has been in banking since long before gender equity and income parity became the hot-button topics they are today. Starting at Alerus 44 years ago, she became chief operating officer in 2002 and chief strategic officer three years ago. In those earlier years, Compton felt all of her work had to be exceptional. She would spend the day at the bank, pick up her children from daycare, and then work from the time her kids went to bed until the wee hours of the morning.
“I can tell you that I developed very poor work habits over the years,” Compton said. Those habits included placing pressure on herself to over-prepare for meetings, where she perceived she’d be expected to outperform her peers.
For her, that work-life balance got easier as her children grew older. Supporting balance also became a part of her bank’s culture, addressing one of the primary leadership barriers women face.
Leaving room for families
Women who are mothers often juggle family responsibilities with work, and may perceive they can’t do an adequate job in a key leadership position, Compton said.
“I think that truly is one of the things that holds women back,” she said. “Certainly, when I began my career, I felt strongly that I had to blend and balance and juggle my family and my work. And at times I felt that my male colleagues did not have that same challenge. I believe that’s changed so much.
“As an organization, I think it’s very important that we recognize this and support males and females,” Compton said.
The cultural shift at the $2.2 billion Alerus started at the top. Alerus Financial’s Chair, President and CEO Randy L. Newman rose into leadership at the bank alongside Compton during the 1980s, when they each had young families. As a consequence, they recognized the importance of family-friendly policies and created a culture to support their workforce.
“We make it very clear in the organization that you should do whatever you can to get to your child’s concert or soccer game or doctor’s appointment,” Compton said. Family time is supported and encouraged, not frowned upon, she added. “Those small things really help.”
Their approach evolved over time and has marked Alerus as a top employer, for men and women.
Alliance Bank’s Pilarski credits her predecessor, Terry Stevens, with creating a similar work-life balance at the bank. The $300 million Alliance Bank encourages its 70 employees to not work long hours, Pilarski said, unless doing so is necessary to finish a project on deadline. Employees reciprocate that balance, she said, by not missing work without reason.
“That is definitely the culture we are promoting and trying to create. We want this to be a place where people feel they are valued and cared for, and that we recognize they are more than just an employee working here from 8 to 5,” Pilarski said. “We know they have a total life, and we care about that.”
Heidi Sexton, executive vice president and chief operating officer at Sound Community Bank, likes the term work-life integration. It makes a difference for her as a working mother of a 10-year-old daughter.
“Certainly, if there’s an important meeting, I will miss something at home. But if there’s an important basketball game, I’ll miss something at work,” Sexton said. “It’s just the balance and the constant prioritization that you have to do in any leadership role.”
Being flexible with working schedules and locations helps, said Sexton, who has the same office set-up at home as she does at her office, with dual monitors and a phone. Rather than work taking over her life, it’s integrated into her life. “I think technology has helped us all to balance life a little bit more,” Sexton said.
A hiring tendency that privileges the status quo, and women’s own lack of confidence, can also be factors affecting the number of women in senior leadership. Mentoring and a commitment to diversity can make a difference.
A Government Accountability Office study published in 2017 found certain practices improve retention and promotion among women and minority groups, including family-friendly policies and flexible work schedules, as well as ensuring that workplaces have mentors, sponsors, networking groups and well-trained managers.
It’s also about holding managers accountable for creating a diverse workforce. Catalyst, a nonprofit organization that advocates for women in workplaces, reported this year that in financial services in North America, there’s a 24 percent gap between the rates of first promotion between men and women. The first-promotion gap was even greater, at 34 percent, for women of color. Among the reported reasons that men were promoted more often than women was having a supervisor who provided advice and advocated for their advancement.
Sound Community Bank’s Stewart, who also serves as chair-elect of the American Bankers Association, said she has read and observed that when a woman reads a job description, she will apply only if she can meet all of the qualifications, whereas men will apply if they meet half the list.
“Women often wait too long to raise their hand for promotions,” Stewart said. “And they don’t recognize that there is no candidate that’s perfect in every possible facet of the job. They have to have confidence to say I can do this job, and they have to raise their hands more.”
Overcoming this confidence gap requires good leadership, said Stewart, whose bank has three women and one man on the $700 million bank’s senior leadership team.
“Leaders have to be sensitive to some of these issues and help women develop the confidence to raise their hand and take a chance on themselves,” Stewart advised.
Stewart, who began working for Sound Community Bank while it was a credit union for the Associated Grocers, has a passion for inclusion. She recalls being told at the start of her career that bank employees should lock their personalities in the car when they headed into work, and not show their customers their genuine selves.
Offering a less-staid environment where employees are free to be themselves creates a culture that “fosters leadership for everyone and opportunity for everyone,” Stewart said. “I think we’re welcoming to faces of color. I think we’re welcoming to the LGBT community. I think we’re welcoming to people who have tattoos up and down their arms and pierced noses.”
“I really felt like I could be in a leadership role at some point because I saw it early on,” said Karin Taylor, chief risk officer at Alerus. Taylor said she has always had female role models in higher-level positions throughout her banking career, and has never felt held back in her career because of her gender. At Alerus, the team — including CEO Newman — is very collaborative, Taylor said. They don’t hesitate to ask each other for perspective and suggestions; communication is very open, productive and respectful, she said.
A large majority of the people who already work at Alliance Bank are women. Might that impact gender diversity at the top in the future? “We definitely encourage promoting from within,” said Tanya Burton vice president and head of information services at Alliance. “When there are open positions, obviously we have a bigger pool of women.”
Burton herself started as a teller, then floated between bookkeeping and the teller line before becoming a full-time auditor. She, too, has felt that she’s always had equal opportunities in banking, even though senior leadership was mostly male. “Coming up in the organization, it was predominantly men, but I felt I always had their support,” Burton said.
Stewart surmised that one of the reasons fewer women are in leadership roles is that bank boards are predominantly comprised of men. People have a natural affinity for those who are like them, Stewart said, and that’s who they hire. “Even if they purposely seek out a slightly different management style, they really tend to hire what feels comfortable, especially in a CEO-board relationship, where you have a pretty intense relationship,” Stewart said.
Pilarski was already in a leadership role at Alliance, as executive vice president and chief financial officer, when the CEO passed away. When offered his position, Pilarski had some reservations about whether clients and shareholders would be accepting of a female president and CEO. One of the board members told her it was the board’s job to let clients know how much they supported her.
“From that moment on, it has not even been a topic,” Pilarski said. “Our board is very supportive of having the right people in place. I think the fact that others within the organization see that there have been women promoted recognize that advancement opportunities exist at Alliance Bank.”
The culture at Alerus has helped in recruiting, Compton said. Women frequently network with each other, and the bank gets great referrals from women in leadership positions in other organizations.
“I think we have gained some momentum because we’ve been very deliberate about this family-friendly culture for three decades,” Compton said. “I believe we’ve established ourselves and are very credible in that regard and have some momentum that perhaps some other organizations don’t have yet.”