Want diversity? Move beyond your closed network
Excuse or not, the challenges of finding diverse talent are a reflection of the segregated country.
While the quest for diverse talent seems quixotic, it's actually a critical goal that reflection and strategy can solve — if it’s understood why it’s hard in the first place.
Unfortunately, some leaders in the banking industry and others have incorrectly claimed that a lack of diversity was due to not having enough diverse candidates. Such claims were recently made by Wells Fargo CEO Charlie Scharf, only reigniting the debate.
In earnest, the difficulty of recruiting diverse candidates reflects the fact that the networks the banking industry typically relies upon to attract and recruit talent do not reach diverse pools of talented candidates. This network gap is insidious too, leading to a lack of diversity in other aspects of business, like vendor procurement and investment.
Once, Mitt Romney spoke of “binders full of women” when running for president. While his wording was inartful, he seemed to recognize that he needed to make a deliberate effort to build his network of talented women in order to be able to appoint numbers of qualified women.
So, what deliberate steps can banks take to close the network gap and find talented people of color? Here are a few things any bank can do to turn intention into impact, and close the network gap.
Begin with reflection: Why are you not tied to diverse networks? Do you know where to find black and brown civil society?
Learning why your company may not be a cultural fit for certain demographics is nothing new for banks. Gender is probably the most recent example.
Understanding that women bring different and needed experience to leadership creates an impetus for more diversity. Hiring goals, mentorship programs, employee resource groups and even breastfeeding rooms were inclusive shifts to create a workplace where women can thrive.
While gender is not 100% analogous, it does highlight the way a company must change to attract and retain a more diverse team.
Next, listen to your bank’s managers and employees of color. A lot of a bank's diversity sits in the branches. Management and employee resource groups can work to create a safe space for them to share their experience and ideas.
Employees of color are the experts in how a company can improve when it comes to race. Explore your company's assumptions when using terms like cultural fit, relative experience and appropriate education. These could actually be a barrier to attracting and retaining talent.
To ensure the conversations are productive, an outside facilitator can help everyone feel comfortable.
Learn how minority banking and finance culture may be different from mainstream banking culture. A distinct world of minority finance exists and they are experts in feeling comfortable in the industry.
While these minority-focused entities are smaller in size, their culture, experience and understanding of racism in banking can be a guide for any bank. The FDIC encourages partnerships and can be a resource into these networks.
Host listening sessions with people — customers, community leaders, partners — who may not always agree with you. Constructive criticism and outside-the-bank thinking is what’s needed to innovate ways to attract and retain talent. These can be private off-the-record conversations, or you can decide to be bold and create a community advisory group to advise on the diversity efforts.
Closing the network gap can be a positive, transformative experience for your company, driving innovation, employee engagement and improved customer service. It also can be profitable: researchers at McKinsey have found “companies in the top-quartile for ethnic/cultural diversity on executive teams were 33% more likely to have industry-leading profitability.”
A more diverse, talented workforce exposes your company to new people and new ideas. It's democratizing because all levels of employees have something to offer and it can help open new markets.
Creating a strategy to close the network gap will help navigate through the segregated society. Finding diverse talent is more than the right thing to do, it’s the most advantageous way forward.
Malia Lazu’s BankThink post is part of our annual Women in Banking series.