USA TODAY International Edition
Black, Hispanic executives are rare at major US banks
USA TODAY’s analysis of employment records uncovers disparities at all levels.
Mechelle Jacobs is a rarity in her profession and the community she serves. •The 53- year- old Black woman is a Bank of America financial center manager in Gilbert, Arizona, a booming, wealthy suburb east of Phoenix. • Black women, like Jacobs, account for just more than 4% of all management jobs among six of the largest U. S. banks, according to employment records obtained and compiled by USA TODAY.
Further, she leads a branch in a community of roughly 250,000 residents where 73% of the population is white.
That’s 13 percentage points higher than the national average, according to data from the U. S. Census Bureau. And just 3% of Gilbert residents are Black, compared with 12% of the nation.
While hardly any of her peers or the bank’s customers look like her, Jacobs said, she hasn’t experienced overt racism within Bank of America or in Gilbert.
“I love everybody who walks into the center,” Jacobs said.
“I’m excited to be here and that they have given me this opportunity. I’m not lacking in anything.”
Jacobs said Bank of America has set her up for success, and she hopes to continue moving up the corporate ladder to become a trainer of new employees.
Her positive experience is critical to an industry with a long history of lending discrimination that has contributed to the racial wealth gap in the United States.
Bank of America, for example, in 2011 agreed to pay $ 335 million to resolve allegations from the U. S. Justice Department that its Countrywide unit engaged in a widespread pattern of discrimination against qualified Black and Hispanic borrowers.
It was, at the time, the largest settlement in history over residential fair lending practices.
But the true test of whether the racial wealth gap can narrow will be if Jacobs can punch a hole in the glass ceiling that has kept Black and Hispanic talent – especially women – from scaling to the top of Bank of America, where 81% of executive jobs are filled by white men and women, despite accounting for just 64% of the U. S. workforce.
The picture is not much different at five other major financial institutions in the Standard & Poor’s 100, a stock market index of some of the country’s most valuable companies, that released their hiring practices to USA TODAY.
Those companies historically have been led by white people.
Even today, USA TODAY found they hold 73% to 87% of all executive jobs at Bank of America, Bank of New York Mellon, US Bancorp, Citigroup, JPMorgan Chase and Morgan Stanley.
USA TODAY’s findings are based on EEO- 1 reports, which detail the gender and race of workers a company employs in 10 major job categories from “laborers” to “executives.” Companies with more than 100 employees file these documents annually with the Labor Department’s Equal Employment Opportunity Commission.
Federal officials will not release those records to the public without companies’ permission, citing privacy protections in the Civil Rights Act.
An ongoing civil suit filed by Reveal, a nonprofit investigative journalism outlet, challenges the legality of hiding these records from the public.
Since last year’s murder of George Floyd, many large publicly traded companies have decided to disclose the data as a way to show the public and shareholders their hiring practices and to demonstrate a commitment to diversity.
‘ It’s not for a lack of talent or skills’
Wells Fargo told USA TODAY it would publicly release its EEO- 1 later this year.
Last year, the San Francisco- based company came under intense scrutiny over com
ments from CEO Charles Scharf, a white man, in September.
He said in a memo, according to Reuters, that Wells Fargo missed its diversity goals because of a limited pool of Black talent to recruit from, prompting a sharp backlash.
Scharf later apologized, walking back his comments, conceding they were insensitive.
Wells Fargo in August 2020 agreed to pay $ 7.8 million in back wages and interest after the U. S. Department of Labor alleged the bank discriminated against 34,193 Black applicants for banking, customer sales and service, and administrative support positions and 308 female applicants for administrative support.
Wells Fargo did not admit liability as part of the settlement.
Melissa Knight, who runs Howard University’s center for career and professional success in Washington, D. C., said there are plenty of people of color to fill top executive jobs in corporate America.
“The fact that 60% to 70% to 80% are white, you have to change that,” said Knight, who ran a similar program at Texas Southern University, which, like Howard, is one of the nation’s historically Black college and universities.
Knight said companies have to be intentional about providing people of color and women high- level opportunities.
“It has to be a cultural thing. It’s not for a lack of talent or skills or ability. It has to be up to a company to make the change,” she said.
Making structural changes
The disparities at major, publicly traded banks are typically the most significant among executives even though the managers working for them, and who might be qualified for promotion, are more diverse.
Among the six banks that shared their data, women, in general, held less than a third of executive jobs and the vast majority were white.
Black or Hispanic women held just 3% of those posts.
Yet, management jobs are almost evenly held by women.
Only 10% of those roles are filled by Black or Hispanic women, and although that’s still short of parity it is better representation than found among executives.
Put another way: Even though Black and Hispanic people of any gender account for 28% of the U. S. workforce, they hold just 8% of executive and 18% of management jobs at these banks.
And yet, outside of leadership and professional roles, these same groups are overrepresented.
Black or Hispanic people account for 40% of tellers, administrative assistants, salespeople, and other workers at the six major banks reviewed by USA TODAY.
This hierarchy – with women and, particularly, Black and Hispanic workers concentrated in lower ranks while white men secure the top positions – in some ways mirrors the nation’s slavery and Jim Crow economies from decades past.
Yet, the greater diversity outside leadership roles also can be an opportunity for banks who choose to seize it.
Susan Reid, Morgan Stanley’s head of diversity and inclusion, said her company has made structural changes to make sure people of color can thrive.
She said Morgan Stanley is teaching employees about unconscious bias and how to make sure all employees are fairly evaluated for promotions.
“The conversations can be very uncomfortable, but they are necessary,” Reid said.
“The only way to drive change is to have uncomfortable conversations about race and gender and the barriers that exist.”
Reid added that banks must have an “intentional strategy” for diversity.
One of the ways her company has increased the number of managers of color is through a new program that recruits mid- career professionals from outside the banking industry, Reid said. She said those recruits learn about banking and financial services during a one- to two- year program.
Most companies lose only a few senior executives each year, but creating a more diverse mid- level management pool gives Morgan Stanley a more diverse group for those executive positions, she said.
Morgan Stanley’s progress cannot be assessed from a single year of data, yet the company’s figures show how much work remains to achieve parity, especially in leadership jobs.
Hispanic and Black workers account for 4% of executives, 13% of managers, 11% of professionals and are just shy of parity with 27% of all other roles.
U. S. Bancorp had the highest percentage of white executives among the banks who shared data: 87%.
Similar to Morgan Stanley, which ranks second lowest for diversity, just 4% of executive jobs are held by Black or Hispanic people.
Citigroup has the most diverse leadership among the six banks reviewed.
Nearly 13% of executives, 19% of managers and 22% of professionals are Black or Hispanic, although they are overrepresented among lower- ranking jobs at 38%.
Women, in particular, are concentrated in posts that pay less and have fewer, if any, decision- making powers.
Although Bank of New York Mellon has the highest percentage of Black executives – 12% – it has zero Hispanic executives.
Moving down the organizational chart, Black and Hispanic people are underrepresented by nearly two- thirds in other high- paying roles.
Daniel Mintz, vice president of external communications for BNY Mellon, declined to answer questions.
In an emailed statement, the company said: “Increasing diversity and fostering an inclusive environment is a business imperative and one of our core values.”
Jeff Shelman, a senior vice president for communications at US Bancorp, said nearly half of all of the company’s new hires in 2020 were people of color but that the bank still has “more to accomplish and we are committed to this work.”
Shelman added that US Bancorp has expanded its efforts to recruit at historically Black colleges and universities and is committed to having at least one woman or person of color in the interview process for all job openings.
‘ It’s good for business’
Cynthia Bowman, Bank of America’s chief diversity and inclusion and talent acquisition officer, said her company has long recruited from HBCUs.
She said Bank of America’s goal is to look like the communities it serves.
To do that, she said, Bank of America publicly discloses its EEO- 1 and has done so for several years to tell the public and shareholders whether it’s meeting hiring benchmarks.
“We think it’s important data. We disclose everything else, why wouldn’t you disclose this?” she said.
“I use data to identify what we need to do to drive progress.”
She added that the company’s EEO- 1 report holds its company leaders accountable across the country, and that diversity and inclusion directly improves the bank’s bottom line.
“We know it’s good for business,” Bowman said.
Billions pledged for opportunities
While most major banks have released their EEO- 1 reports to USA TODAY, they also have pledged billions of dollars to provide economic opportunities for Black and Hispanic communities after the national protests that followed Floyd’s death at the hands of Minneapolis police office Derek Chauvin.
The biggest commitment came from New York- based JPMorgan Chase, which pledged $ 30 billion in October to help with affordable housing, small business loans and access to capital for communities of color.
JPMorgan Chase also promised to have “a more diverse and inclusive workforce.”
Those financial commitments have generated plenty of positive headlines for the country’s major banks.
Yet Knight of Howard University said what the students at her school want are jobs and opportunities to move up.
“We are well aware of the unequal hiring practices that have occurred for years,” Knight said.
“There just needs to be openness and honesty. Tell us how you are going to change it.”