Wells Fargo’s top exec ad­mits his ‘un­con­cious bias’

San Francisco Chronicle - - BUSINESS REPORT - By Ken Sweet

Wells Fargo CEO Charles Scharf apol­o­gized Wed­nes­day for com­ments he made sug­gest­ing it is dif­fi­cult to find qual­i­fied Black ex­ec­u­tives in the fi­nan­cial in­dus­try.

Scharf said in a memo to em­ploy­ees “there is a very limited pool of Black tal­ent to re­cruit from” in cor­po­rate Amer­ica. The memo was writ­ten in June, but be­came pub­lic only this week.

The com­ments and sim­i­lar state­ments made in a Zoom meet­ing, re­ported by Reuters, led to an in­tense back­lash in Wash­ing­ton and on so­cial me­dia.

“Per­haps it is the CEO of Wells Fargo who lacks the tal­ent to re­cruit Black work­ers,” Rep. Alexan­dra Oca­sio­cortez, D­N.Y., tweeted.

Scharf said in a state­ment Wed­nes­day that his com­ments re­flected “my own un­con­scious bias.”

“There is no ques­tion Wells Fargo has to make mean­ing­ful progress to in­crease di­verse rep­re­sen­ta­tion,” he wrote.

The San Fran­cisco bank has pledged to in­crease hir­ing of mi­nor­ity can­di­dates, par­tic­u­larly through Black col­leges and uni­ver­si­ties, as well as new an­tiracism train­ing pro­grams at the bank.

Like much of the po­lit­i­cal and cor­po­rate world, the bank­ing in­dus­try has had to face a reck­on­ing for its role in the racial and eco­nomic in­equal­ity that Black and other mi­nori­ties face. Banks have an­nounced changes to how they lend, and cre­ated new pro­grams to spur eco­nomic de­vel­op­ment in com­mu­ni­ties of color.

Cit­i­group said Wed­nes­day that it would di­rect $1 bil­lion of its cap­i­tal to­ward clos­ing the “racial wealth gap” in the U.S. It would in­clude $550 mil­lion in home­own­er­ship pro­grams for com­mu­ni­ties of color, and hun­dreds of mil­lions for Black­owned busi­nesses and sup­pli­ers.

Amer­i­can bank­ing is dom­i­nated by lead­er­ship that is largely white and male. None of the six big Wall Street banks have ever had a Black or fe­male CEO. Two weeks ago, Cit­i­group said it would pro­mote a woman to CEO next year, the first on Wall Street to do so. Banks large and small are still reg­u­larly cited for dis­crim­i­na­tory prac­tices, in­clud­ing al­le­ga­tions of “redlin­ing” Black home buy­ers. Redlin­ing is a prac­tice in which banks deny or avoid pro­vid­ing credit ser­vices to peo­ple be­cause of racial de­mo­graph­ics or the neigh­bor­hood where they live.

About 13% of named ex­ec­u­tives at fi­nan­cial ser­vices com­pa­nies are a racial or eth­nic mi­nor­ity, ac­cord­ing to In­sti­tu­tional Share­holder Ser­vices.

The last prom­i­nent African Amer­i­can to lead a large fi­nan­cial ser­vices com­pany was Ken­neth Chenault, for­mer CEO of Amer­i­can Ex­press. He re­tired in 2018. He had called the lack of a pipe­line to re­cruit and re­tain di­verse tal­ent “em­bar­rass­ing” to the fi­nan­cial ser­vices in­dus­try.

Stan­ley O’neal, CEO of Mer­rill Lynch while it was still an in­de­pen­dent com­pany, is also Black. He re­signed in 2007 dur­ing the firm’s col­lapse.

Alex Brandon / As­so­ci­ated Press

Wells Fargo CEO Charles Scharf said it was hard to find qual­i­fied Black ex­ecs.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.