view transcript

Katherine Ross: Thanks so much for joining me, Sallie. We have been inundated with headlines about the lack of diversity in the workplace. We've heard about Citigroup, we've heard about Oracle, Google, etc. not doing enough for diversity, and it's almost a case of who isn't on the list. As a woman in a senior leadership position, I'm wondering how are you tackling this issue?

SallieKrawcheck: Well, I'm tackling this issue by starting my own company. Because at the end of the day, it's really tough, really tough to change cultures [00:00:30] of big companies from within. And you can be, you can see all the research about the power of cognitive diversity, which is driven by gender diversity, skin color diversity, diversity background perspective, et cetera, et cetera. You can see all of the research on diversity that says you won't just earn better returns, you can earn way better returns. And yet the urge we have to work with people who are like ourselves, to be comfortable in what we [00:01:00] do, is just there.

And we've all really been socialized in our society that a leader in senior leadership is a white male. And so we see the research and we say in theory I should hire that person whose way different from me. It doesn't make a lot of sense to me, I don't really know how they're going to be successful. I've seen the research but boy, this individual who reminds me so much of myself, I can envision this. I can envision [00:01:30] how this person was successful. And so we lean on our own experiences for our intuition, and we don't override it for the research. It's not the research just got published, the published has been there. And yet it has not been nearly enough to drive diversity.

So how do you change it? You either change it because the CEO and the Board make the decision that they're going to do the painful things to change it. That they're going to override the senior manager, who's got great results, who's been there for forever, who just [00:02:00] isn't into this diversity thing. That's a hard thing to do. So either they're going to make that decision, and some are. You see the folks at whether it's Sales Force or MasterCard, there are a handful of them that are making those tough, tough decisions. Or, you can start your own thing. And decide that you are going to build a culture from the ground up that is a culture that represents the best in what we've learned about what makes companies great.

Katherine Ross: Let's go and give some companies report card ratings. Now [00:02:30] I want to start with Congress. I want to pretend that they're a company for a moment. Diversity-wise, what would your grade be?

SallieKrawcheck: They're getting better because one of the wonderful things after this last election is we not only have greater gender diversity, which I know is what you're asking for, but how about age diversity? How about people who know what the internet is and actually have been on Facebook? Right? Who know the difference between Google and Apple. Well, that's so refreshing. So [00:03:00] we, the country, bear responsibility for this. And I love the fact that we've got some very different opinions that are coming through loud and clear now.

Katherine Ross: So Real Money's Kevin Kern gave the big bang sort of report card. And I'm wondering the sector in general, what rating would you give them?

SallieKrawcheck: On diversity?

Katherine Ross: On diversity.

SallieKrawcheck: A C.

Katherine Ross: A C? Why a C?

SallieKrawcheck: A C. Because they haven't made much progress since the financial crisis. [00:03:30] In fact, as of a couple of years ago ... So it's bit outdated, but as of a couple of years ago gender diversity has gone backwards since the financial crisis. So we tend to think of diversity's a good thing to do, so there will be forward movement and motion. But in fact, it can go backwards too. I don't give them an F because they talk about it, and they have a bunch of programs for it. And some of them I really do believe are meaning. What I've thought about them is that some of them [00:04:00] talk about it as being a pipeline issue. It hasn't been a pipeline issue since the 1980's. It's been a promotion issue.

When you dig into the research, it's not that there aren't enough women at the bottom. It's not that all those women are leaving for work/life balance, right? It's that they aren't promoted. And so they get clogged up there at the bottom and don't make it to the top. And that's why we see Citi a year ago came out with their gender pay disparity. And the number they [00:04:30] came out in the U.S. a year ago was we don't have one.

And they've just come out with, I think, a 29, 30 percent gender pay disparity this year. Like what? Did they go backwards? The number last year was job for job are men and women getting paid the same? This year was overall are women and men getting paid the same? And what that show you is another really important problem, which is simply the women simply aren't as senior as the men.

Katherine Ross: I'm glad that you brought that up. So McKinsey & [00:05:00] Company did a 2018 survey and they found that one in 25 C-suite leaders is a woman of color. Now you've written that it could take possibly hundreds of years for a woman of color to close the pay gap. And I'm wondering how do you speed up this timeline?

SallieKrawcheck: Well, look so let's backup, right? So the gender pay gap for white women is decades away from closing. For black women it's 100 plus years away from closing. And for Latino [00:05:30] women is 200 plus years from closing.

Katherine Ross: That's a long time.

SallieKrawcheck: That is a very long time.

Katherine Ross: Even decades is too long.

SallieKrawcheck: And it's not fair. It's just fundamental fairness. So how do you change it? You just close the f'ing pay gap. You close the f'ing pay gap, okay? You go in as a number of CEOs have done and you say, first of all, let's measure it because if you aren't measuring it, it's there. Because our biases, women have them and men have them too [00:06:00] about gender, tend to be so powerful. So first of all you measure it, and then you wipe it out. What doesn't that mean? That I'm going to make less money. If I'm paying these people, is it going to the bottom line? Yes.

In the short term, if you view it as an expense. If you view it as an investment that will compensate these individuals fairly, what may happen, what will happen is that you're going to have fewer of them leave. When they make those financial decisions about maybe taking [00:06:30] another job, or maybe coming in every day when the boss is sort of not a great boss, and you have another opportunity. And so you just ... It's not overly complicated. You don't have to have a diversity task force, and get all the women together once a month to have someone like me come in and talk to them. That's delightful, but just friggin' do it.

Katherine Ross: I'm glad that you said that. And I also want to go back for a second. Because my next question kind of hits on the [00:07:00] point that you already brought up, which is the senior ... There's less senior women. And McKinsey & Co's study also found that women get less access to those senior leaders. So I want to put that in perspective. And you already brought up Citigroup.

So Citigroup said that it would make hiring women in senior positions a priority, but do you think that that's enough to help women get access to these potential sponsors?

SallieKrawcheck: Well look, sponsors are tremendously important for anybody to get ahead. In fact, when I talk to my friends from college and my friends from business school, [00:07:30] and you look around and you say gosh, she was so successful. And she was so promising, but wasn't. And you sit down and you have a couple of glasses of wine and you say what's the difference between the two of them?

What led one to great success and the other not is they tended to have a very senior, typically male, sponsor. Who fought for them, and when someone on the operating committee would say she's a little abrasive, [00:08:00] he would be the one saying we just said Joe was aggressive and that was a positive, and now we're essentially using slightly different words but the same concept for her. So cut it out, jerk.

Or give her that great project. And give her the air cover she needed in order to make her way to success. And so having that kind of sponsorship at a very senior level is actually make or break for a career.

Katherine Ross: KPMG's [00:08:30] 2019 Women Leadership Study found that women are motivated by pay more than job titles. As someone who switched from a corporate job to being an entrepreneur, are you more motivated by pay?

SallieKrawcheck: I haven't made money in so long, I forgot what it looks like. So, no. You know what I'm motivated by? I'm motivated by making a change. So I had this great, good fortune to have these amazing jobs on Wall Street that nobody gets to have. I got to run Smith Barney and Merrill Lynch Wealth Management [00:09:00] and CFO City. Nobody gets to do that. And when I paused and recognized that women don't invest as much as men do, that it costs women hundreds of thousands or millions of dollars over the course of their lives ... Not the pay gap, the gender investing gap.

When I looked and though about all the tens and tens of millions of dollars the big banks and Wall Street firms had spent on their women's initiatives that did not work, and I thought okay, [00:09:30] first I'm a woman. Second of all, I have this experience. Third of all, I can get capital raised in order to do it. Fourth of all, I'm curious enough and egoless enough to do the research to figure out what will get her to invest. When I saw that, I said all right, somebody's got to do it. And that somebody's got to be me.

And so I really put mission first. Because before I leave this earth, I want to make a difference. And the amazing thing about getting [00:10:00] women to invest more is it's obviously good for them. It's obviously good for their families. It's good for the economy. It can be good for markets. It's good for our culture. Nobody loses. Because she's investing, he didn't ... What, she invested? I didn't get to invest too. She took all the investing. None of that stuff.

So for me that's what it's about. Would I like to make money? It'd be fun one day to make some money, but it's more about mission.

Katherine Ross: [00:10:30] I love that answer, thanks. So I also spoke to KPMG's Chief Diversity Officer and she told me she strongly believes in mentorship and sponsorship. And you've said this before, but I want to ask this again, do you think that this is a key for women's success in the workplace?

SallieKrawcheck: Is sponsorship a key for women's success in the workplace? Yes. Is the answer as simple as that? Absolutely not. It's just such a challenging issue. So women [00:11:00] are over-mentored. I can't remember what the numbers are, but like ten times as many mentors as men. People who will answer their questions. Everybody; oh, let me go mentor a woman, I'll mentor a person of color.

But we have a fraction of the number of sponsors, the people who fight for us. So of course having more sponsors is key. It is a key. But let's back up. How about mandated family leave? Where do women really start to fall out? It's when they have the first child, the second child, [00:11:30] and only a teens percent of companies in this country have these mandated family leaves, these paid family leaves.

And so you have any number of women who you have to come back after giving birth. Any number of professional women who because of our culture and the work culture we have, feel the need to come back to work even if they have the family leave. And we're just looking at it all wrong. First of all, are we so mean a country [00:12:00] that only we in Papua, New Guinea don't have mandated family leaves. Or the richest country in the history of the world and we can't give working women ... Women who work outside the home ... A little break when they have a baby? That's how mean we are.

Well, it gets meaner. Because we talk about the family leave as being an expense. It's an investment. And there's research by KPMG that points to that investment pays off for itself in less than a year. When I was running big businesses, if you came to [00:12:30] me with an investment that paid off in less than a year, we did it every time. We got rid of other investments too, every time. How can it pay for itself in a year?

Because women are more likely to come back if they have the time to bond with their family and heal, right? Get the little darling off to a good start. And so you don't have to pay for their replacement and you don't have to pay for training. So yeah, mentors and sponsors, but family leave is really important.

Katherine Ross: And I know that you spoke to Tracy Burns about that, and [00:13:00] the number that you gave, I can't remember exactly what it was, but it was in the millions. Women lose like 1.7, I believe, million?

SallieKrawcheck: Oh my gosh, so if women ... Women are more likely to take career breaks. And we're more likely to take career breaks because we are the gender that has the baby. Because we still have gender roles within our society that have the woman caring for the child more than the spouse does. [00:13:30] We're more likely to take leaves because when we get older, the care for the parent lands on us. We're more likely to take leaves because if something goes wrong in the family, it's more likely to fall on us.

And we typically as women, and as families, miscalculate the cost of those leaves. So the example I like to give if is a woman is making $85,000 a year and she takes a two-year career break, she says okay, I'm going to lose a lot of money, it's $170,000. The real number is 1.7 million dollars. [00:14:00] And the reason for that is because what we don't typically calculate in is the pay cut she takes when she comes back. Which is a double digit percent after two years, a bigger double digit percent after three years. And by four and five years, just forget it. And so the impact to the family financially we vastly underestimated as a result.

Katherine Ross: You mentioned women getting older, and that's a point that I want to hit on. Because women live longer than men by a few years on average. How important is it especially [00:14:30] for women to focus on retirement?

SallieKrawcheck: Oh my gosh. So here are the stats. Women live on average six to eight years longer than men do. Eighty percent of women die single. And if you don't believe me, walk through any nursing home in this country where the older men are having the absolute times of their lives because there are a [inaudible 00:14:49] every couple of them. We tend to retire with two thirds the money of men. And if we're women of color, much less.

So how important is it that we focus ... [00:15:00] It's incredibly important. And I like to say they call them individual retirement accounts for a reason. And that is as women, we can partially overcome the gender pay gap by investing. We can overcome some of this by focusing on our retirement savings and our retirement investments. And the challenge today is that again, if you go back to our society and the roles that we have historically adopted, the guys manage the money and the women manage the family.

And even in [00:15:30] Sheryl Sandberg's book Lean In, she talked about how Dave did the money and she did the birthday parties. I mean, I feel like she's going to be okay on the money. But these are historic gender roles. And at my age I can't tell you how many women, of my friends, again from school, who's ... One husband's passed away of a brain tumor, one in a car wreck, one in ... And these women are left with where's the money, [00:16:00] what do we have? We didn't think.

We have made for women talking about money so weird that it's almost criminal. Let me give you an example. If you were to leave here and go out for drinks with your girlfriends, you are infinitely more likely to talk about sex than about money. And in fact, I would challenge you that there's no amount of money you make today that you would feel comfortable telling your girlfriends about. Nothing. It's either too much or too little.

[00:16:30] In fact, women prefer to talk about their own death than money. That's how weird we've made it. And it goes all the way back to childhood when the gender roles are enforced and dads talked to little boys about building wealth and moms talked to little girls about saving money. It's a little bit like Reshma Saujani talks about boys. Boys are taught to be brave, and girls are taught to be perfect. He's taught to build wealth and she's taught to save.

And the message that we then get [00:17:00] as we grow up from the teen magazines and the women's magazines have historically been you spendthrift. Don't buy that latte. Save that money. Whereas the guys are getting diversified investment portfolio, do you want to buy IBM, is it time to sell Apple. And we're getting are you a Miranda or a Carrie when it comes to money. And so we infantalize women when it comes to money, which leads us to not [00:17:30] knowing what kind of raise to ask for, because we don't talk to anybody about it. And being unprepared for retirement. It's really a tragedy.

Katherine Ross: And Ellevest has a retirement product, correct?

SallieKrawcheck: So Ellevest ... Look, we are all about women and money. And when people said to me you should start an investing platform for women, I was like that is such a stupid idea. Women don't need their own thing. Quit patronizing us. Shut up today. And then when you realize there's this gap and that [00:18:00] we need a place where we can talk about money in a smart way and in an approachable way. As we were talking about, what's the real cost of a career break?

You're not seeing that anywhere else. How do you plan for retirement when the spouse is likely to be gone. How do you take into account in the planning that women living longer and our salaries peak sooner? We are the ones who are sort of in a smart, sophisticated but approachable [00:18:30] way, not just telling women you need more financial education, go buy the book and figure out what standard deviation is.

But working to really meet them where they are with a product that is sophisticated, parts of which are patent pending, that really meet their needs as opposed to Wall Street as it is today, which is based on trading, alpha, etc. Nothing wrong with that, but the research shows us it hasn't engaged women as much as it has men.

Katherine Ross: [00:19:00] It kind of seems to me that diversity is a double-edged sword in some cases. And I want to bring up the California law that requires every board now to have a woman. Which sounds great on paper, but I'm wondering if that really helps promote diversity.

SallieKrawcheck: Yes, it does. Because it forces it.

Katherine Ross: But when you're just having a woman to have kind of that token woman?

SallieKrawcheck: Because there are no smart women who are qualified out in California? The state has got thousands and thousands of them. There are [00:19:30] so many. Go out to California. There are so many bad-ass women in California, it will knock your socks off. So I totally do not buy that you got to dumb it down, we don't have the right folks, we don't have the right experience. It's California. Land of the female entrepreneur. Land of the female VC.

It is such an entrepreneurial state. The problem is not there aren't qualified women. In fact, the board list ... My friend Sekendra Singh has an entire [00:20:00] board list. One might say binders of women who are qualified for board seats. The fact is that those who are in power out there believe there aren't enough qualified women. Because number one, they've been socialized that way. I'm thinking of a board member. It's a white guy with a couple of people of difference around the table, but not more than a couple because that's what I'm used to. So that's number one.

And number two, their networks are filled with white guys. Where they have non- [00:20:30] diverse networks. So they don't know these people. And so when they go and they say it's time to put someone on the board ... I've done it a zillion times, who do I know, who do I know? That's where you go for your board. Who do I know? Well I know Joe and Jim and Steve and Tim and John and Jonathan and Stuart and Harvey and Harold and ... Nope, no qualified women. Dude, because you don't know any of them.

Katherine Ross: [00:21:00] Okay, so how do you make that the thing? How do you make people put those women on the board?

SallieKrawcheck: You have a quota. Look, I totally get it. I totally get it. Quotas are un-American and un-apple pie and if you were there by a quota you must be a level below. And people who are there because of quotas ... I don't want to just be there because of a quota, I want to be there because of my own accomplishments. I get [00:21:30] the whole thing. I've stated the whole thing. I don't know that I'm for quotas.

But what I will say is when you finally get to where nothing else works, you can keep doing the same thing, hey, here's an idea. Let's bring out more research on the power of diversity. Because the research from Goldman and Morgan Stanley and The World Bank and the IMF and McKinsey and Deloitte and Catalyst, like that's not enough. [00:22:00] Maybe the next piece of research, if we can just get one piece of research, like maybe the Street. Maybe if the Street put out that piece of research would finally be the one that like the whole damn is friggin' burst open, and we go to diversity.

Not going to happen. So one thing is, you tell me another idea, but baby quotas is one. And look, we'll be able to look at California and see what happens. And does that tend to drive performance? Does that tend to drive [00:22:30] more fairness, more representation and therefore better performance? Or is it a disaster? Thank you, California, for testing this for us.

Katherine Ross: I've got to agree, we've got to let it sit for a little bit and see how it goes. Now, you wrote a piece in CNN Business that stated that diversity initiatives are not actually helping promote diversity. Do you want to-

SallieKrawcheck: I don't know that it's such a blinding insight. But diversity has stalled [00:23:00] out. We talked about the gender pay gaps are closing at a glacial rate. We are declining in terms of the number of CEOs of Fortune 500 companies. Let me try that again. We are declining in terms of the number of Fortune 500 female CEOs. What was the question?

Katherine Ross: Oh, perfect. This is fun. I actually, [00:23:30] I'm glad that you said that about the California thing because when I was talking to KPMG's Chief Diversity Officer, I asked her about the California law and she did not like it. She was like I think that we need to get rid of it. We don't know that it's going to work. It's going to be the bare minimum. But I like that.

SallieKrawcheck: That's right. Why wouldn't we try it?

Katherine Ross: Yeah, no, that makes sense.

SallieKrawcheck: Because she's part of the patriarchal society too, right?

Katherine Ross: Yeah.

SallieKrawcheck: Okay, what was the question?

Katherine Ross: Okay, so the question is you wrote a piece in CNN Business-

SallieKrawcheck: Ah, yeah, [00:24:00] okay keep going.

Katherine Ross: You wrote a piece in CNN Business that stated that diversity initiatives are not actually helping to promote diversity. Now can you explain that?

SallieKrawcheck: I think it's pretty obvious, which is everybody has diversity initiatives. Everybody. Diversity is going sideways. The gender pay gap, as we talked about, is decades or hundred plus years away from closing, depending on whether you're a white woman, a black woman, a Latino woman. The number of female [00:24:30] CEO's in Fortune 500 companies is declining.

So you tell me. We've got one big input, which is existing diversity initiatives. And an output which is kindly characterized as not much progress, and less kindly characterized as going backwards. So should we keep doing the same thing?

Katherine Ross: It's not working.

SallieKrawcheck: That's what we do. Let's face it, it's not working. And [00:25:00] I think leadership teams lull themselves into ... It's a pipeline issue. We just juiced up our women's diversity group and we're going to go from having one cocktail, one big get together a year, to one get together every month and maybe that'll do it. But it's got to ... We need time for the whole thing to sort of filter through, and so the can gets kicked down the road.

The only way to change this ... Because these cultures [00:25:30] are so strong, and particularly in a successful company. We're a successful company, why do we have to change? The cultures are so strong that in order to break it, a CEO needs to make the very tough decision that this is a very important business initiative. Not one of 20, not one of 15 or 10, but one of four or five. And that they are going to drive this and they're not going to let up on it.

And they're going to pay for it. Otherwise [00:26:00] I don't see any indication we would do anything but continue to see what we continue to see. Maybe I'll be surprised. Maybe moving the diversity meeting from once a year to four times a year will do it. But I would be surprised.

Katherine Ross: Almost kind of like try smarter not harder.

SallieKrawcheck: That's right. Or try different.

Katherine Ross: Try different, I like try different.

SallieKrawcheck: Try different. Say you know what, we made no progress on everything we've done so far, let's try something new. Let's take the mentor program and let's make it a sponsor program. And that if everybody on our executive [00:26:30] committee of 20 cannot find one person of color, one person of difference, one female to fight for and make it part of their professional reputation and maybe their compensation to get that person ahead, to give them what they need and get them promoted through.

That could be a way of saying, rather than this very passive mentor program, come to my office and I'll answer some questions for you and hope you leave quickly, to this. [00:27:00] Anything like that. Break with the past.

Katherine Ross: I read that Ellevest didn't see a large uptick in trading during December swings. I'm wondering if women, because they're not as active traders, if they're better investors in a hostile market?

SallieKrawcheck: So I am so excited, because the bear ... There were a couple of bear cases on Ellevest when we raised our Series 8. And one was your digital first. And [00:27:30] we've got client service but we're digital first. And so you're going to grow nicely when the markets are going up. But when the markets go down, that's it, you're done, you're toast.

And we went through October, which felt not good. And we went through November, which felt uncomfortable. And we went through December, which felt terrible. Particularly the day before Christmas. I'm like really, the day before Christmas? Really? We're doing this the day before Christmas? Fine, we'll do it the day before ... Bring in Christmas, fine. [00:28:00] Felt really bad. I didn't know how bad it was until I saw a chart in the Financial Times that showed not just record outflows but panic.

Record outflows in December, since they started measuring it, panic. What happened at Ellevest? Well, we had double digit percent under asset management growth, month over month. Record inflows. Record growth. And our attrition rate, which has been low since we launched, [00:28:30] and I understand from others quite a bit lower than other digital firsts, stated a low single digit percent annualized.

So we came through very nicely. P.S., the other bear case on us was our cost of acquisition for our clients which was low when we started, would go up, and in fact it's continued to go down. Different topic. So why do we think it is? There is research that tells us that women tend to trade less, that women [00:29:00] tend to ... Maybe we're busy, check our accounts less therefore feel the need to take less action.

I also believe it's because we built a product for her that lets her know if she's on or off track to achieve her goals financially. Because it is scary to me when the market goes down a lot and you're operating in a vacuum. My portfolio is down x percent since two weeks ago or a month ago. Oh, right, that's a scary [00:29:30] thing. If, on the other hand, you have an Ellevest which shows you how you're tracking to your goal which was built with quite a few down markets implicit in our forecast which works to get you to your goals, not in an average market but in the majority of markets.

And so you can come on to the website and at any point in time see where the market was down a lot. Oh look, I can still retire on time. Oh look, I can still buy my house on time. And to know that if you don't have time [00:30:00] to check it, that if you fall off track we'll send you an email. And that email will tell you you fell off track. In order to get back on track, to have a 70 percent chance of reaching your goal rather than a 50 percent change, you need to retire x weeks later. You need to deposit another $1,000.

I mean, that is so much more comforting than ahh, right? My portfolio is down. So we really build a product to help guide her, and him ... We have some guys too, we love guys, [00:30:30] but to help her really see how she's doing and getting to where she wants to go.

Katherine Ross: And obviously helping her, if we have another Christmas Eve where you're seeing the stock market plummet and you don't have to trade you can just hold steady.

SallieKrawcheck: That tends to be the most successful, that individual investor. Mutual funds tend to underperform the market by the amount of fees. Individual investors tend to underperform mutual funds because they tend to trade in and out at the wrong time. So if you can just get in and sort of stay put, for [00:31:00] the vast majority of folks you're just better off.

Katherine Ross: Do shareholders have a moral responsibility to push for diversity?

SallieKrawcheck: Here's what I would say. The research tells us that shareholders would have better financial results in pushing for diversity. I am partial owner of the Pax Ellevate Global Women's Leadership Fund, which invests in the top-rated companies for advancing women. As calculated by [00:31:30] the percent of their board that are women, the percent of the leadership team that are women. And since we launched four and a half years ago, we've outperformed the market.

So I don't know ... Moral, sure. The country was founded on equality of opportunity. We didn't always exactly live those values. So I could argue that, but I'll go ahead and argue a financial return. I think we're really, through Ellevest, through the Pax Ellevate Global Women's Leadership Fund, through [00:32:00] a number of the projects that I am engaged in, I think we're really proving it every day.

Katherine Ross: What's one question that gets under your skin that you're asked a lot?

SallieKrawcheck: How do you have work/life balance? I will never forget, I was CFO of Citi and I was on a panel with the other CFOs. Only female. And here's Joe, the CFO of XYZ large company and Steve, the CEO of ABC large company. And we're getting our CFO [00:32:30] questions, and then Sallie, how do you achieve work/life balance. And I'm like ahh, not enough that I'm CFO of Citi, I have a different hurdle which is work/life balance.

And so I for a while said you know, my goal was to be a mediocre mother. I didn't want to be a bad mom, mind you. I did not want to be a bad mom. But right there at mediocre, the rooms aren't really as clean as they could be. [00:33:00] The cookies, although I did bake some cookies but the cookies aren't always homemade. My son ended up wearing his lower school shirt for about three months into middle school.

I'm like hey, it toughens you up. It toughens you up, kid. And Oreos are there. But you know, the thing I think we need to watch on it is, it is again something that society imposes on us. That success in the workplace or success in the home is not enough. There has to be some kind of success in both, and that there's [00:33:30] some kind of perfect balance that needs to be achieved. It's in some ways a construct of our privilege. That we're able to try to shoot for that balance that so many women and men who are working two jobs or three jobs in order to make ends meet don't have that privilege to try to go up.

But it's a real pain in the you know what to be professionally successful and then have yet another hurdle to go to. So I think we just have to ... [00:34:00] I think we can be hard on ourselves as women and search for how other women are doing it, and try to hold ourselves up to this really impossible standard. And I just think we need to forgive ourselves for not having a sort of Instagram lovely life every single day. But recognize that you've [00:34:30] got to do the best you can where you do the best you can. And recognize that privilege.

Katherine Ross: You say that women don't invest sooner because they want to educate themselves. And I think that this could actually be expanded to shell-shocked millennials like myself who worry about losing their money the same way that their parents did in 2008. As a Wall Street veteran, can you tell me three things that I could do in the market?

SallieKrawcheck: I don't know three things, I'll give you one thing.

Katherine Ross: Okay, one thing.

SallieKrawcheck: Which is invest [00:35:00] steadily in a diversified investment portfolio. That's it. And when I say invest steadily, if you had invested the day before the market crash of 1929 or 1987 or the internet bubble back in 2000/2001, right before the '07/'08 crash, it would have taken you a long time to recover if you invested on that day and did nothing else. By the way, what would have been worse is to take [00:35:30] the money out right after, which is what you would have wanted to do.

What works tremendously well even if you'd invested the day before is to invest a little bit out of the next paycheck, and the next paycheck, and the next paycheck. Your personal finance viewers are saying that's called dollar cost averaging. I understand. I get it. But let's talk through why. It's because you're buying high here, you're buying low. Maybe you're buying low, you're buying low. You're buying high, you're buying high.

And so you're evening this out to get more like [00:36:00] a market-like return. Maybe that doesn't feel sexy. What I want to do is buy the day after the crash, and then sell the day before the peak. Good luck with that, Warren friggin' Buffett. Thank you, Warren Buffett. By the way, even Warren Buffett doesn't market time and he's a genius.

But it's just find a low cost provider and just make it happen. At Ellevest. At Ellevest. I'm sorry, I had something stuck in my throat for a second.

Katherine Ross: [00:36:30] What's a piece of career advice that you want to give to younger women that you wish you'd gotten yourself?

SallieKrawcheck: You know, the usual one is sort of work hard and take risks-

Katherine Ross: But you're not usual.

SallieKrawcheck: Right. When you fall down, get back up. Don't let them shame you. Don't get embarrassed. Failure-

The one I'd probably give now, now that we've gone through this sort of me too times up moment is recognize it's not always your fault. And that if you're working hard [00:37:00] and your work quality is good, and you're not getting the promotion. Steve gets the first promotion, Steve deserved it. Okay, Stuart gets the next promotion. Well, that guy was pretty neck and neck with Stuart. James gets the next promotion. But by the time Todd is promoted, at that point a professional woman needs to recognize, it's not you, it's the boss.

And he may be the nicest guy in the world, but he may be falling into [00:37:30] that trap of I want to promote people like me. Or I'm more comfortable with promoting people who are the same as me. And so I think watch that and make sure that you're networking, that you've got your head up, that you know what's going on in your company and your industry. The research says we women tend to go in head down like we're at school; if I just do great work it will be noticed.

But you've got to pop your head up and sort of see what the landscape is. To have relationships [00:38:00] throughout the company, and outside. So that if you end up in one of those situations, which the research will tell you, most women do, most people of difference do, you've got the ability to move.

Katherine Ross: A class action lawsuit states that female Oracle employees were paid $13,000 less than their male colleagues. Apparently there's less than a one in a billion chance that this pay gap happened by chance. Now, I'm wondering have you ever been in a situation where you're being purposely paid less?

SallieKrawcheck: [00:38:30] Well, no one would admit it.

Katherine Ross: Right.

SallieKrawcheck: So I certainly used to ... I'd be able to see when I was in the regulatory filings what I was making versus others, but nobody needs to feel sorry for me on that. In fact, cut that out.

Katherine Ross: Okay.

SallieKrawcheck: Have I ever been in a situation? You never know. I mean, the challenge with making less is one, do you ever know? Two, if you find out, what the reason is. And is it really that your work quality [00:39:00] wasn't as good as the other person. Or was there some kind of bias that's in there?

Katherine Ross: What is your advice to women in this situation?

SallieKrawcheck: Well, I'd say my first bit of advice is first of all, work hard, do a great job, be excellent at what you do. And know what's going on around you. So sunlight's the best disinfectant. You can now go to things like Glass Door, PayScale, or any of a range of different websites that [00:39:30] will tell you how much you should be making in your job. Now they're not perfect, but they'll get perfect. And so at least you can triangulate.

If you are comfortable, talk to your friends who are in similar positions. Some people talk to people at work. Some folks aren't comfortable with that. But have some knowledge about this. And then engage with your boss, not at the moment you're supposed to get the raise, but way before about what does success look like. And the more you can quantify it, the better.

Oh, we have six [00:40:00] audits coming up this year. Our goal is to pass all six audits. Or we have this sales quota this year. Or we want to get this many new social media followers. If you can quantify it, all the better. One of the reasons that I was successful early is that I was a research analyst. And so it just wasn't a question. It just wasn't a question. Did my stocks that were supposed to go up go up, and the other ones go down? Were we doing trading in my stocks, because clients were appreciating more. We were doing it until they get ranked. I admit, it was pretty straightforward, [00:40:30] as opposed to the well, you did a good job this year. You have no metrics, but you were a little aggressive.

Katherine Ross: You mentioned this way earlier and I kind of want to hit the nail on the head again here, because Jim Kramer and I were talking this morning about this, and it's the fact that there are less women in the CEO positions now than there were before. And I'm wondering, do you have any idea why that is?

SallieKrawcheck: Because there's so few. It may well come down [00:41:00] to the law of small numbers. That you lose this one for this idiosyncratic reason; you lose this one for this reason, and if it were amongst the guys you wouldn't notice. But because they're so very few of them, one is a big percent. And of course, what we're not seeing is they're replacing themselves with other women. Which tells us that overall the bench at that next level simply isn't strong enough.

Katherine Ross: My final question for you is as a woman [00:41:30] in the workplace, especially one that is high powered, what's a sign that you're being undervalued?

SallieKrawcheck: A sign that you're being undervalued, well, when you're being underpaid. When you're going to be fired.

Katherine Ross: That's a good sign.

SallieKrawcheck: When you're getting talked over. When your ideas are being taken by someone else. When you're not getting board opportunities. All the things that we hear about and read about that [00:42:00] again, because the ... I don't think it's ill-meaning for so many people the way we've been socialized, where women are supposed to sit back a little bit quieter. Guys tend to be more forward moving. That you can feel yourself getting sort of run over.

Katherine Ross: Sallie, thank you so much for joining me.

SallieKrawcheck: Thank you. But, let me add one thing. When people ask me the question did being a woman in the workplace, being a woman on Wall Street, hurt or help [00:42:30] you, my answer is yes.

Katherine Ross: Yes to both?

SallieKrawcheck: Yes. Because there were times when being the only woman, you just like ... You couldn't hide, right, and so when I was a research analyst and the clients would say oh, you know, I really like the research that woman is putting out, what's her name? It was me. Versus there's that guy with brown hair who has glasses and wears a tie. [00:43:00] And I like his research. You have to narrow it down for me.

And then there were times when as being one of few women, you sort of felt like you couldn't hide either when times were tough. I look back to the financial crisis, and say sometimes to groups of people, name the CEOs and they go through the CEOs. And I said now name the CFOs in the financial crisis. And the name that comes up is Erin Callan. And I say now name a male [00:43:30] CFO in the financial crisis.

And maybe some of your viewers can because they're really involved in Wall Street. But most folks can't name another one. And that woman was so blamed for what happened at Lehman, when those who understand the workings of these large institutions, it is the CEO. The CFO executes. And by the way, she was only in that job a pretty short period of time. And she was run friggin' out [00:44:00] of New York City. The male CFOs, we won't know their names, we don't know who they are, we don't know what jobs they have. And so that was a time when being a woman certainly hurt her in comparison to being a guy, because she didn't have any place to hide.

If you can't beat 'em, leave 'em.

Sallie Krawcheck, who was CFO at Citigroup and CEO of Merrill Lynch, left Wall Street to become the CEO of Ellevest--an investing platform designed for women and has been campaigning for diversity ever since.

While Wall Street is no stranger to diversity initiatives, Krawcheck said that "diversity is heading sideways," meaning corporate America still has a long way to go. 

Citigroup (C - Get Report) recently revealed that--despite the fact that half of Citigroup's workforce is female--only 37% of senior positions are held by women.

Related. Keep Your Eyes on the U.S. Dollar in the Days Ahead

Citi has announced that equalizing salaries is important and that it is making hiring women in senior levels a priority. But, in 2019, why is this still an issue? Krawcheck responded:

"We've all really been socialized in our society that a leader in senior leadership is a white male. And so we see the research and we say, in theory, 'I should hire that person whose way different from me. It doesn't make a lot of sense to me, I don't really know how they're going to be successful."

Michele Meyer-Schipp, chief diversity officer at KPMG, emphasized the importance of mentors and sponsors in the career's of women and people of color.

Related. Three Ways to Make a Big Difference With Your Money

Related. Why I Favor a 'Reactive Approach' to Smart Investing

Krawcheck responded that she, too, finds mentors and sponsors to be really important. And, instead of diversity initiatives that may or may not work, she has another idea for companies.

Say 'you know what, we made no progress on everything we've done so far, let's try something new. Let's take the mentor program and let's make it a sponsor program. And that, if everybody on our executive committee of 20 cannot find one person of color, one person of difference, one female to fight for and make it part of their professional reputation and maybe their compensation to get that person ahead, to give them what they need and get them promoted through.'

Is Citigroup in Jim Cramer's Action Alerts Plus Portfolio? Click here to find out.