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Women on Wall Street: Fighting for Equality in a Male-
Dominated Industry
Allison Schieffelin and Morgan Stanley
On June 12, 2004, Morgan Stanley agreed to pay $54 million
to settle dozens of claims from women who alleged that the securities fi rm
denied them pay increases and promotions due to their gender. The case, fi led
by the Equal Employment Opportunity Commission (EEOC) on September 10, 2001,
resulted from repeated complaints by Allison Schieffelin, a 43- year- old
former convertible- bond sales clerk who worked in the fi rmâs institutional-
stock division for 14 years. Schieffelin earned more than $1 million a year,
making her one of the highest- paid and highest- ranking women on Wall Street
to publicly challenge the industryâs pay and pro-motion practices. Schieffelin
claims that she was trapped under a glass ceiling and continuously denied
promotion to managing director despite being the top performer in her
department. The EEOC claims that in addition to being repeat-edly denied
promotions and pay raises, women employees in Schieffelinâs division âendured
coarse behavior and lewd comments from their male colleagues and supervisors.â
Moreover, fi rm- organized sales outings with clients to golf resorts and strip
clubs excluded women.Of the $54 million settlement, $12 million was paid
directly to Schieffelin. About $40 million will be used to settle complaints
from an estimated 100 current and former female employees of the institutional-
stock division. The remaining $2 million was used to enhance anti-
discrimination training at the fi rm. In addition to the monetary settlement,
Morgan Stanley must also fund a program to have an appointed outsider monitor
hiring, pay, and promotion practices for a three- year period. Although the
settlement seems large, it is merely âpocket changeâ to a fi rm like Morgan
Stanley; the $54 million represents approximately 2% of the $2.45 billion in
profi ts the fi rm earned in the fi rst half of fi scal year 2004.Background on
the Schieffelin et al. v. Morgan Stanley CaseAllison Schieffelin fi rst
complained of Morgan Stanleyâs working environment in a 1995 written review of
her boss stating, âHe makes the convertible department and the fi rm by
extension an uncomfortable place for women.â During that same year, she also
submitted an internal complaint about âunwelcome advancesâ from one of her male
managing directors. At the time, she thought that management would be pleased
with the tactful manner in which she handled the issues; how-ever, today she
feels management placed her on a âwatch listâ instead.In December 1998, after
three years of withstanding the menâs locker- room type atmosphere, in which
the male employees openly âswapped off- color jokes and tales of sexual
exploits and treated their female colleagues as inferior,â Schieffelin took her
harassment and discrimination complaints beyond the firmâs executives to the EEOC.
She hoped that the fi rm would see that she had been a dedicated employee
throughout her entire career and that the issues with the fi rmâs pay and
promotion practices needed to be amended. Instead, she claims the fi rm
âembarked on a campaign to get me to quit.â She was fi red in October 2001 for
what the fi rm claims to be misconduct after a heated confrontation with her
supervisor; however, both Schieffelin and the EEOC viewed her fi ring as
illegal retaliation for her discrimination complaints. One year after
Schieffelin complained, Morgan Stanleyâs New York convertibles department, the
department in which Schieffelin worked, promoted Gay Ebers- Franckowiak to
managing directorâ the fi rst female managing director in that department; many
people believe that this was no coincidence.Morgan Stanley denied all
discrimination charges and claimed that their female employees were and are
treated equally. The EEOC planned to reveal evidence at the trial proving
otherwise. The anticipated evidence indicated that some male employees of the
fi rm ordered breast- shaped birthday cakes and hired strippers to entertain at
offi ce parties. The evidence supposedly provided statistics regarding the
disparities between female and male promotion and pay within the fi rm. The
trial was scheduled to begin July 12, 2004; however, a settle-ment was wrapped
up mere minutes before opening arguments began. As part of the settlement,
payroll statistics that showed whether or not there was a pattern of
discrimination were sealed.

1 Is business ethics relevant to the topic and examples in
this case or is this just business as usual? Explain.
2. What are the ethical implications of the one- time
arbitration requirement that prevented Wall Street employees from seeking
redress through the court system?
3. Why is the securities and investment banking business
male- oriented and dominated?
4. Why does sex discrimination seem to persist on Wall
Street in spite of the negative publicity of lawsuits and monetary costs of
5. What can or should be done to transform the per sis tent
culture of sex discrimination on Wall Street?

4. What differences, if any, in your ethical principles and
morals do you be-lieve you would have to adjust to in negotiating with other

7. Does globalization result in cultural and economic
homogenization (alike-ness) through a heightened emphasis on consumerism, or is
this an exag-geration? Explain and defend your position.

8 Select two global companies mentioned in this chapter and
locate their cor-porate web sites. Find their codes of conduct or ethics
statements. Down-load these and evaluate whether or not they serve any
practical purposes or help meet the companiesâ social responsibility goals and
why. (ImClone and Mattel)

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