Banks that want equality must walk the talk
In the wake of the 1968 assassination of Dr. Martin Luther King Jr., I helped my dad create a sign that we hung on what remained of his butcher shop, which had been burned and looted amid unrest in Pittsburgh.
“Owned by a Soul Brother,” the sign said.
More than half a century later, my heart broke to see so many similar signs in my now hometown of Minneapolis as our community mourned the tragic and unjust death of George Floyd.
The feeling, sadly, was all too familiar. In 2016 when I stepped into what would become the chief diversity officer role at U.S. Bank, our Twin Cities community had tragically and unjustly lost another Black life at the hands of a police officer, that of Philando Castile.
Over the past few months, our headquarters market has emerged as the epicenter of this most recent wave of social justice activism, civil disobedience and simply, anger.
It is a reckoning for a region that has been a tale of two cities, in more ways than one. The area’s longstanding inequities are coming to light: an income gap that is one of the worst in the country for Black families, one of the lowest homeownership rates nationwide for Black families and persistent achievement gaps in our schools. And many proud residents are, for the first time, beginning to understand the meaning of systemic racism.
This moment has also put on notice the institutions that have played a role in perpetuating such systems, including banking and financial services. As an industry, we are experts at managing to expectations and driving accountability. As leaders in the industry, we need to refocus this expertise toward reducing the disparities that, in many ways, have been reinforced.
Personally, this summer has reignited the frustration that I felt in both 2016 and 1968, but professionally it has also given me energy to do my part to make sure this time is different. As my team channels the momentum of the past few months into our learnings of the past few years, we see three areas where bankers can make immediate impact.
First, there needs to be an intentional focus on advancing Black leaders in organizations. Across industries, far too often Black professionals are the least represented in senior executives ranks of corporate America.
So many organizations hire for diversity but manage to assimilation, and that is a fundamental problem. We need to be more intentional about creating conditions in which all employees can develop leadership, demonstrate creativity and advance professionally.
Second, large companies need to develop meaningful relationships with Black-owned businesses. Although banks alone cannot end systemic racism, we can lead the way in closing the significant racial wealth gap in this country.
According to a 2016 Federal Reserve study, white households had the highest median wealth level that year at $170,000 while Black households had a mere $17,600 in median family wealth, or 15% of white families'.
One way to collectively start to changing this is by doing regular, ongoing business with Black communities, including extending capital to them, not just by providing philanthropic donations. If we invest in meaningful relationships, we will help Black-owned businesses build capacity, grow, scale, hire and recycle resources within their communities.
This needs to start today, especially given the recent New York Fed report that found Black-owned businesses have been almost twice as likely to shutter as firms overall during the coronavirus pandemic.
And third, bankers at all levels need to be active in denouncing systemic racism, and acknowledging privilege. I have had emotional conversations over the past few months with colleagues of all backgrounds. Many had reached out to check in on my well-being. Others wanted to help with the path forward. Some simply wanted to feel heard. Together, we are laying the foundation for a future of listening, learning and taking action.
At U.S. Bank, we know that we need to improve in each of these areas and — like the rest of this industry — to simply do more and do better than we have in the past.
For example, this started to take shape at U.S. Bank through a $100 million annual commitment toward addressing social and economic inequities. We also elevated the diversity office to the managing committee, with my role reporting directly to U.S. Bancorp’s chairman, president and CEO Andy Cecere, as of July 29.
A couple of weeks later as the summer came to a close, an American Banker article said that “the hiring of chief diversity officers and other diversity-related staff is a start.” And that is exactly right.
Diversity, equity and inclusion takes teamwork and is not the job of one person, or one company, or one industry.
But that is how it starts, with each of us.