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Democrats highlight lack of diversity at major banks in new report

Democrats highlight lack of diversity at major banks in new report
© Greg Nash

The nation’s biggest banks lack diversity in their top ranks, and the industry as a whole is falling short when it comes to disclosing workplace data, according to a report released Wednesday by House Democrats.

The analysis from Democrats on the House Financial Services Committee found that while entry-level jobs at banks closely resemble the broader U.S. population, senior level executive positions are mostly held by white men.

In data submitted to the committee from 20 of the 44 biggest banks, including Goldman Sachs, Capital One and Morgan Stanley, only 29 percent of senior executives were female and 20 percent were from a racial or ethnic minority group in 2018.

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All 44 banks surveyed by the committee acknowledged they needed to make some improvements related to diversity and inclusion, according to the report.

“The banking industry believes in the value of diversity, equity, and inclusion and that a diverse workforce is critical to the success of individual banks being able to meet the needs of a diverse set of communities and customers across the nation,” Naomi Mercer, senior vice president for diversity, equity and inclusion at the American Bankers Association, said at Wednesday’s House Financial Services subcommittee hearing.

House Democrats said increasing transparency is one of the first steps that needs to be taken.

“We need to start from the top down,” Rep. Joyce BeattyJoyce Birdson BeattyLawmakers highlight need for financial literacy to improve credit The Hill's Morning Report - Biden argues for legislative patience, urgent action amid crisis On The Money: Senate confirms Yellen as first female Treasury secretary | Biden says he's open to tighter income limits for stimulus checks | Administration will look to expedite getting Tubman on bill MORE (D-Ohio.), chairwoman of the House Financial Services Subcommittee on Diversity and Inclusion, told The Hill. “I believe we want more transparency.”

Democrats said in their report that there is a shortage of data available from banks regarding their diversity and inclusivity. Financial institutions are not required to disclose diversity data, though some provide the information to federal regulators voluntarily.

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The Federal Deposit Insurance Corp. said it has a 16.7 percent response rate, followed by 9.3 percent at the Office of the Comptroller of the Currency and 5 percent at the Federal Reserve, according to the committee report, which found that 23 of the 44 banks surveyed publicly share diversity data in some form.

Democrats appeared split, though, on whether to make reporting diversity data mandatory.

“I think it’s a little early to come to conclusions about how we are going to proceed in ensuring that we get the information related to diversity and inclusion from everybody,” House Financial Services Committee Chairwoman Maxine WatersMaxine Moore WatersMarjorie Taylor Greene expressed support on Facebook for violence against Democrats Bottom line Capitol Police report warned that Congress could be targeted three days before riot MORE (D-Calif.) told The Hill. “This report is the beginning.”

Rep. Al GreenAlexander (Al) N. GreenRemoving slurs, bigotry from places on our maps paves the way to remove them from all aspects of our lives Safeguarding US elections by sanctioning Russian sovereign debt The Memo: Trump furor stokes fears of unrest MORE (D-Texas), however, advocated for requiring banks to report diversity and inclusion data.

“When you have power you have to use it,” Green said. “We have power. Regulations are the thing to do.”