Citi is first mover on gender pay gap – will other banks budge?
One percenters: Citigroup has finally revealed its gender pay gap: 1% across its workforce in the U.S., U.K. and Germany. It said the pay for U.S. minorities is also 99% that of their nonminority counterparts. The company intends to fully close the gap by increasing the pay of women and U.S. minorities. It also will do similar analyses on what it pays employees in other countries. There are a few stats more striking than the reported pay differences: About half of Citi’s employees are women, but only a quarter of senior executives are female. In the U.S., 11% of its employees are African-American, while only 1.6% of senior executives are. Citi, which has more than 200,000 employees globally, is the first major U.S. bank to disclose data on its pay gap in response to pressure from the Boston investment firm Arjuna Capital. Arjuna filed shareholder resolutions on the issue with the nation’s largest banks last year — only to be rebuffed in every case. It will be targeting eight financial institutions in the 2018 proxy season.
Turning a negative into a positive: Leasing excess space is giving some banks an additional source of cash flow. But another, and arguably more important, benefit has been an opportunity to get close to local entrepreneurs. With digital banking options reducing branch traffic, banks are finding that many existing branches are bigger than they really need, so they have been subletting or creating shared space. Oklahoma’s Citizens Bank of Edmond has transformed its recently vacated office into a 12,000-square-foot entrepreneurial center called Vault 405. President and chief executive Jill Castilla said she hopes to fuel the local economy and strengthen the bank’s customer relationships by creating an affordable work space for small businesses. “We see this as an extension of the bank, providing a fertile ground for small-business growth,” Castilla said. Lead Bank in Garden City, Mo., has a similar initiative: a branch in Kansas City built in 2015 provides free office space to two technology startups each year as part of a local entrepreneurial grant program. “We think this is the way banking needs to be done in the future,” said Melissa Beltrame, Lead Bank’s director of marketing. “It’s all about relationships.”
We need to talk: Inspired by a reverse mentor, Goldman Sachs’ Edith Cooper made it a goal of hers to bring productive conversations about race, religion, nationality, gender, sexual orientation and disability to the workplace. Cooper said the young mentor helped her realize “how important it is for people to bring their true selves to work,” and how fraught casual conversations with co-workers can be if you try to hide details such as being gay from them. Cooper, who has been in our Most Powerful Women in Finance ranking, led Goldman’s human capital management team before leaving the job at the end of last month, and she remains a senior director for the company. She introduced multiple diversity initiatives at Goldman over the years, including unconscious bias training that she said not only improves employee morale but the quality of work. “You’re sitting in a [meeting] room and you’re [suddenly] conscious of the person who’s different and never says something. Then you start realizing, ‘Hey, I’m only hearing from the same two people, I’ve got to fix that,’” which leads to better conversations and better ideas, she said.
Talent show: Banks are doing more than relaxing the dress code to retain tech talent. They’re now offering roles that didn’t exist not too long ago, said Elly Hardwick, head of innovation at Deutsche Bank. “There are so many opportunities in artificial intelligence, machine learning and distributed ledger technology,” she said. “Think of the reasons why tech companies want to partner with big banks — exactly the same things are attractive to employees at these companies.” Citi FinTech’s global chief product officer, Carey Kolaja, can back that up. Before joining the bank in 2015 she had worked at eBay and PayPal. “Five years ago I never thought I would be at a bank,” Kolaja said. “It is about the magnitude and scale of the problems you can solve at a bank.”
Get it together: Banks need to take PSD2 more seriously, Anne Boden, CEO of Starling Bank, wrote in City A.M. this week. PSD2, short for Payment Service Directive II, refers to a substantial regulatory change in Europe that essentially requires banks to play nice with nonbanks that offer payments services. Specifically, the banks must open their APIs, or application programming interfaces, to these third parties. The idea is that consumers will get more payment options, greater security, and other benefits. Some major banks weren’t able to meet a deadline to comply with the new requirements, so they remain in an age of username and password sharing and screen scraping. This puts customers at unnecessary risk, Boden scolded. “Our advice is straightforward,” she said. “If your bank cannot connect to your chosen third-party provider without asking for your login and password, hold fire until they have a secure API in place. It’s simply not worth the risk.”
Thumbs up or down?: On Tuesday the Senate Banking Committee will review the nomination of Jelena McWilliams to lead the Federal Deposit Insurance Corp. McWilliams is the chief legal officer at Fifth Third Bank and former chief counsel for the Senate Banking Committee.
Haverhill Bank in Haverhill, Mass., has added Kristin Murphy, owner of a local country club, to its board of directors. She is the second woman on the 14-member board.
What you’re worth: If you’re earning less than you think you should be, then this a story for you. Grey’s Anatomy star Ellen Pompeo is, in her own words, “not the most ‘relevant’ actress out there” and “not necessarily perceived as successful.” But she is the highest-paid actress on a primetime drama, at $575,000 for each of the 24 episodes she shoots per year plus a seven-figure signing bonus and equity points on the series worth another $7 million or so. Pompeo discussed her personal career struggles, the education she’s received from years in Shondaland, and the importance of women seizing their financial power and asking for what they think they’re worth in order to create more widespread change. She stayed with the series despite earning less than her longtime co-star Patrick Dempsey for many years. “At one point, I asked for $5,000 more than him just on principle,” she said, “because the show is Grey's Anatomy and I'm Meredith Grey. They wouldn't give it to me. And I could have walked away, so why didn't I? It's my show; I'm the number one. I'm sure I felt what a lot of these other actresses feel: Why should I walk away from a great part because of a guy? You feel conflicted but then you figure, ‘I'm not going to let a guy drive me out of my own house.’”
Fallout: A highly controversial date night with comedian Aziz Ansari is inspiring a lot of think pieces, and The Cut helpfully compiled what it considers to be the best takes.