Sallie Krawcheck: 'Companies Should Do Better'

Episode Summary

Executive Summary: Sally Krawcheck argues that closing gender gaps requires institutional change, not just women negotiating harder. The conversation covers pay equity, paid parental leave, investing behavior, and why traditional wealth management often fails women. Krawcheck says Elevest is built around women’s goals, trust, and plain English, with family-friendly policies and fiduciary advice designed to keep more women investing and better served.

Main Topics: Gender pay gap and institutional responsibility: Krawcheck says pay parity is still decades away and companies—not women—must close the gap through transparent pay practices, better promotion systems, and corrected biases in offers and raises. Paid parental leave and career breaks: She explains that caregiving expectations and weak family leave policies drive women’s career interruptions, widening lifetime earnings gaps, and that equal leave for all caregivers is both fair and economically rational. Why women invest differently: Her core claim is not that women are more risk-averse, but that many simply do not invest because the industry’s products, messaging, and culture are built around male norms rather than women’s goals. Elevest’s goal-based, fiduciary model: Elevest is positioned as a women-centered investment platform that emphasizes financial goals, trust, personalized portfolios, and clear communication instead of benchmarks, jargon, or product-first selling. Diversity, firm performance, and investment outcomes: Krawcheck argues diverse teams and leadership produce better decision-making, innovation, and risk management, which can improve returns and reduce blowups compared with homogeneous teams. Industry shortcomings in serving women: She says many advisors still exclude or marginalize women in meetings, leading to negative surprises, distrust, and women leaving advisors after major life events like widowhood. Culture, harassment, and barriers to advancement: Krawcheck discusses why financial services has not had a full Me Too reckoning, citing arbitration, confidentiality, competition, and the persistence of male-dominated power structures.

Key Arguments: The gender pay gap remains persistent and will not close quickly without companies proactively auditing and correcting pay and promotion practices. Women are often socialized not to negotiate as aggressively, but that is not the root solution; employers should not rely on individual negotiation to ensure fairness. Career breaks are not simply personal choices because policy failures like the absence of mandated paid parental leave force many women into caregiving exits. Equal paid parental leave for all caregivers is an investment that can pay for itself by improving retention and reducing replacement/training costs. Women are more likely to invest when advice is organized around life goals, trust, and understandable language rather than trading, jargon, or abstract benchmarks. Traditional advisory relationships often fail women because advisors speak mostly to men, overlook women’s needs, and create distrust that surfaces after death or transitions. Diverse leadership and teams can improve risk management and performance by reducing groupthink and bringing different perspectives to decision-making. A fiduciary standard is important because current regulatory complexity makes it nearly impossible for ordinary investors to understand advisor conflicts and differences in standards. Financial-services culture, especially competition and arbitration, has muted public accountability around harassment and slowed collective action among women.

Data Points: Time to pay parity for white women vs. white men: Decades away - Krawcheck’s estimate of how long full parity would take at current pace Time to pay parity for Black women vs. white men: 100+ years - Her estimate for Black women’s pay parity timeline Time to pay parity for Latinx women vs. white men: 200+ years - Her estimate for Latinx women’s pay parity timeline Paid parental leave at Elevest: 12 weeks for both primary and non-primary caregivers - Company policy described as equal for all parents/caregivers Digital-only portfolio fee: 25 basis points - Lowest-service tier at Elevest Advisor + executive coach tier minimum: $50,000 minimum; 50 basis points - Mid-tier service offering Women leaving joint advisors after spouse’s death: 70–90% - Rate Krawcheck cites for women exiting joint financial-advisor relationships Negative surprise when money returns to women from spouses: 74% - Women discovering poor outcomes after previously outsourcing money decisions Women outliving husbands: 6–8 years - Used to explain why women often need more long-horizon planning Women managing money on their own at some point: 90% - Her estimate of how common solo money management becomes for women Mutual fund managers who are men: 90% - Illustrates male dominance in the investment-management industry Mutual fund dollars managed by men: 98% - Industry concentration statistic cited by Krawcheck Paid parental leave payoff: Pays for itself in one year - Krawcheck says research suggests the benefit offsets the cost quickly

Pivotal Quotes: "We are all about getting more money in the hands of women." — Sally Krawcheck: Her overarching mission for Elevest and gender equity "Women are doing their part here. It's the companies that need to close this darn thing." — Sally Krawcheck: On the gender pay gap and where responsibility lies "Maybe it's not that women are risk averse. Maybe they don't like what we're selling." — Sally Krawcheck: Her reframing of women’s lower investing participation

Implications: For listeners, the episode reframes women’s financial under-participation as a product, policy, and culture problem—not a personal failing. For firms, it argues for fiduciary advice, equal leave, transparent pay, and goal-based products if they want women clients and employees to stay.