Big banks need more diversity in leadership ranks: House Democrats
WASHINGTON — The biggest banks in the U.S. are falling short in appointing women and minorities to top leadership positions, House Democrats said in a report released Tuesday.
A report released by House Financial Services Committee Chairwoman Maxine Waters, D-Calif., said “megabanks are making some progress in their diversity efforts but there is much more to do.”
Less than 25% of senior leadership positions at the eight largest U.S. banks are held by women and minorities, and there aren't any women or minorities holding chief executive titles at the institutions, the report said. The report also noted that no chief diversity officer reports directly to the CEO.
The findings follow a March hearing with former Wells Fargo CEO Tim Sloan, and an April hearing with the heads of Bank of American, Bank of New York Mellon, Citigroup, Goldman Sachs, JP Morgan Chase, Morgan Stanley and State Street. After the hearings, Waters requested that the banks provide the committee diversity and inclusion data, as well as information about diversity policies dating back to 2015.
To be sure, banks have made strides in recent years diversifying their leadership ranks. Citigroup, for example, had just two women on its executive leadership team in 2014; today it has five. Also, it's chief financial officer, Mark Mason, is African-American, and its chief risk officer, Bradford Hu, and its general counsel, Rohan Weerasinghe, are Asian.
At JPMorgan Chase, six of the 11 direct reports to Chairman and CEO Jamie Dimon are women.
Still, Democrats on the House Financial Services Committee believe that big banks can do better. In their report, they urged big banks to increase their focus on recruiting through affinity groups and minority colleges and university, close the pay equity gap for women and minorities, and increase investment in leadership and development programs for “building a pipeline of diverse talent.”
Kevin Fromer, the CEO of the Financial Services Forum, which represents the largest U.S. banks, said in a statement that the group's members are committed to diversity.
“Members of the Financial Services Forum focus on diversity at all levels and actively promote an inclusive environment where people from all backgrounds can thrive, benefiting our employees and customers across the country,” Fromer said in a statement. “We appreciate the committee’s acknowledgment of the progress that we have made and look forward to continued collaboration to meet shared goals.”