sabine mauderer : gender economics speech by dr sabine mauderer, member of the executive board of the deutsche bundesbank, at the g7 cebadi diversity, equality and inclusion summit 2022, frankfurt am main, 4 november 2022. * * * 1 introduction dear central banking colleagues, dear guests, a very warm welcome from me, too. i am very proud that the bundesbank is hosting this year's central bank - hr diversity, equality and inclusion summit. it goes without saying that diversity matters for any institution. and for central banks in particular, as they act on behalf of the wider public. i would like to start today's talk by showing you a photograph of the ecb's governing council. this photo was taken during an informal gathering at a country house hotel outside frankfurt about three years ago. let's take a look. here you can see a group of mostly middle - aged, white european men sitting around a large table. there is also one woman at the table, president lagarde. so, what can we deduce from this? first, decisions are taken by a group. that is positive by itself, because ideally the decision - making process should reflect the different values and perceptions of all members. however, the group appears to lack diversity. true, a person's outer appearance can be deceptive. it does not necessarily tell you anything about his or her value set or perceptions. nevertheless, it is widely acknowledged that diverse teams – - be it in terms of gender, ethnicity or thought – produce a wider range of opinions, leading to better and more robust results. it is also widely acknowledged that a more diverse decision - making body better reflects the blend of values and perceptions of a democratic society. 2 main part what i would like to show you today is that values and perceptions can influence precisely those economic indicators that dominate our decision - making. i will elaborate this point with two examples, starting with the concept of gross domestic product, or gdp. how do we measure economic activities? how do we value them? and what does that tell us about our value structure? as a second example, i would like to show you that humans differ in the way they perceive changes in price developments. 2. 1 gdp 1 / 3 bis - central bankers'speeches undoubtedly, gdp is one of the most prominent economic indicators. it measures most of a country's output 1 of goods and services over a certain period.

is the case of german hypo real estate, which failed in 2009. third, taking banking supervision from the national to the european level will add a degree of separation between supervisors and the banks they supervise. this will prevent supervisors from treating their banks with kid - gloves out of national interest. nevertheless, we can expect european banking supervision to draw upon the experience and resources of national supervisors. supervision itself will take place in so - called joint supervisory teams. these teams are headed by ecb staff but are composed of national supervisors. to sum up : there is a lot we can expect from european banking supervision, and now it has to deliver. in this regard, we should remember one thing : european banking supervision is an bis central bankers ’ speeches immensely complex operation that has been put together in a very short time. thus, it would probably be unrealistic to expect everything to run smoothly from day one. it will certainly take some time before every detail is sorted out deep down in the engine room of actual banking supervision. nevertheless, i am confident that we will get there and that our expectations will be fulfilled. 3. the single resolution mechanism – the necessary second step but we should not let unrealistic expectations become the roots of complacency and, consequently, disappointment. european banking supervision is not the holy grail of financial stability. it certainly contributes to making banks more stable, but it is no panacea. thus, we have to supplement it with other measures. let me elaborate on one point in that regard. banking supervision cannot prevent individual banks from failing – not at the national level and not at the european level. is this a problem? not at all : the possibility of failure is an essential element of a market economy. nevertheless, banks are special in that respect. just remember the 15th of september 2008, when the failure of a single investment bank pushed the financial system to the brink of collapse. the lesson is that the failure of very large or interconnected banks can lead to a systemic crisis. thus, these banks are perceived as being “ too big to fail ” : when push comes to shove, the government might be compelled to step in to prevent disaster. consequently, “ too big to fail ” banks operate with an implicit and cost - free insurance. apart from the costs this insurance imposes on taxpayers, it most definitely sets the wrong incentives for the risk - conscious behaviour of banks. thus, solving the “ too big to fail ” problem is paramount for making