The Ambassadors Magazine - July 2011

Christine Lagarde
The First Woman to Lead the International Monetary Fund (IMF)

The French Finance Minister, Christine Lagarde, 55, is the first woman to lead a major global economic institution. After being elected last June for a 5-year term, casting aside the only other candidate, Mexican Central Bank Chief, Agustin Carstens, who was supported by only Australia, Canada and Mexico (only 12% of the IMF voting shares). Lagarde started her career as a lawyer.

She inherits an institution that is reeling from the departure of its previous leader, Dominique Strauss-Kahn, who resigned to fight his arrest on sexual assault charges in New York. She has been dealing with turmoil since the global economy was spun out of control by the bankruptcy of the investment bank, Lehmann Brothers, in 2008. She was at the centre of efforts by the group of twenty economic powers to reverse the global recession with a massive stimulus program, and emerged as a key negotiator in the EU financial rescue of Greece, Ireland and Portugal.

Lagarde has put her gender at the centre of her campaign for the IMF's leadership thereby making a case for her candidacy far stronger. Both her candidacy and her subsequent appointment to one of the most prominent positions in the international polity highlights the overwhelming absence of women in leading economic roles across the globe.

Just as her gender may have been an asset in her appointment, it will likely be a frequent source of difficulty in the often hostile climate of international economics. Nevertheless, Lagarde's credentials and experience as a single or sole women leading the organizations she has in the past makes may have prepared her for the IMF job. She was previously the first Finance Minister in the G8.

In just a few months on the job, the new Managing Director of the IMF is facing a crisis on both sides of the Atlantic. She mentioned in her first news conference to highlight the importance of dealing with the European crisis, she told reporters, the sovereign debt in Europe, the U.S. and Japan is the issue that most worried her. "I think we've been burned once. We'd better be shy this time," she said in reference to the fallout from the decision to allow investment bank Lehman Brothers to fall in 2008.

Her appointment is significant, since it shows that young women entering the study of economics can actually climb up the ranks. Dr. Francis Woolley, an economics professor at Carleton University in Canada, said that this change might not be glacial, but there is progress.

Like her predecessor Strauss-Kahn, Lagarde, and only a month after starting on the job, Lagarde is already facing controversy as she is currently being investigated in a finance corruption case in France where she is suspected of embezzlement. If sentenced, Lagarde could face 10 years in jail and a fine of $215,000. A court in France confirmed that Lagarde can continue with her duties at the IMF as the case against her is being investigated. It is expected that this process might be a prolonged one.

At Canadian universities, only 8.3% of full professors in economics are women. The number is 10.7% in the U.S. At the Bank of Canada, 5 of 6 members of the governing council are men, while the Bank of England has no women on its monetary policy committee. However, the number of female academics appointed in economics departments has surged in the last four years. These women, "really push people's conventional ideas about what economics is, and what economists do. And that is terrific," said Prof. Woolley.

For the record, American professor Elinor Ostrom, is the first woman to win the Nobel Prize in Economics in 2009 in its 40-year history, for her work on the commons. She is a political scientist rather an economist.

Zambian-born economist, World Bank consultant, Dambisa Moyo, is the author of the New York Times bestseller book entitled. "Dead Aid: Why Aid is not working and how this is a better way for Africa. In 2009, she was named one of the world's 100 most influential people.

Interestingly, UNESCO elected its first female head, the Bulgarian Irini Bokova, in 2009. She was Ambassador Extraordinary and Plenipotentiary of the Republic of Bulgaria to France and to the Principality of Monaco; Permanent Delegate of the Republic of Bulgaria to UNESCO.