When the head of one of the nation’s largest banking corporations recently made a remark about Black employees, he did much more than trigger a controversy. He cast a spotlight on a pervasive myth that still holds back diversity at businesses nationwide, across numerous sectors.
“While it might sound like an excuse, the unfortunate reality is that there is a very limited pool of black talent to recruit from,” Wells Fargo CEO Charlie Scharf wrote in a company memo in June. Reuters saw the memo and reported it days ago, setting off all sorts of angry responses. Rep. Alexandria Ocasio-Cortez, D-N.Y, tweeted that perhaps Scharf “lacks the talent to recruit Black workers.”
In a memo to employees, Scharf wrote, “I apologize for making an insensitive comment reflecting my own unconscious bias. There are many talented diverse individuals working at Wells Fargo and throughout the financial services industry and I never meant to imply otherwise.” Scharf detailed steps the company is taking to diversify its workforce. He added, “I know we will be judged based on our outcomes.”
But the “outcomes” of recent years show just what a bad job Wells Fargo and several other major banks have been doing at this. Data obtained by the Washington Post shows that Black employees at Wells Fargo made up 8% of senior roles in 2015, but that number dropped by half to 4% in 2018.
Investing in talent
The argument that there’s a lack of diverse talent is nothing new. It’s a belief that has remained prevalent in numerous industries for decades. As Scientific American reported in 2016, the same argument has been used in academia. But in reality, “The exponential growth in PhD’s from underrepresented groups in the last 30 years has not been matched by comparable growth in hiring them.”
The problem isn’t a lack of talent. It’s a lack of talent that businesses have been willing to invest in.
Excellent, skilled candidates don’t just appear from out of nowhere. They’re developed. They’re given support. They’re presented with opportunities to prove what they’re capable of. They’re attracted – both to a sector and to a specific company. Then, they’re promoted and retained.
At all levels of this process, Black people and other minorities are at a disadvantage. And it’s up to huge corporations like Wells Fargo to fix the levers holding back diversity in their ranks.
When I work with businesses on this issue, particularly in the oil and gas sector, I often start by discussing internships. When I ask people how they began their careers, most (if not all) say they had the help of connections. Their parents were able to make calls to friends and get them their first opportunity. Those opportunities then help make them more “hireable” in the eyes of companies in the sector. So the cycle perpetuates itself. It’s up to corporations to end this practice so that everyone gets an equal shot, regardless of family connections.
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It’s also crucial to ending practices in which employers hire people who are like them. As research has shown, managers prefer candidates who are “not only competent but also culturally similar to themselves in terms of leisure pursuits, experiences, and self-presentation styles.”
In addition to recruiting diverse candidates and giving them equal opportunities, businesses also need to work to make their workplaces comfortable and psychologically safe for people of all backgrounds. No one wants to be miserable every day. If Black people, Latinos, Indigenous People, women, or people from any other group feel they don’t belong, they’re obviously much more likely to leave. Businesses need to investigate their workplace cultures – and their managers – who are losing minority employees and see what the organization or the manager is doing wrong.
Fixing the system
But the obligations of big, powerful companies like Wells Fargo (the San Francisco-based corporation has the largest number of employees of any bank) runs deeper. It’s up to exactly these kinds of companies to help fix the broader issues that prevent minorities from advancing.
As the Wall Street Journal reports, the number of Black MBA students has been stagnant in recent years. Universities need to attract more of them into MBA programs. Black students are also less likely to get employer support to cover the costs of an MBA and have “a shortage of corporate mentors” to guide them.
If big banks really want diversity, it’s there for the taking. These companies have been around for a very long time – Wells Fargo was founded in 1852. The company could have raised multiple generations of diverse employees by now.
People trust these corporations with their life savings. Their executives make huge decisions involving billions of dollars on a daily basis, which can sway the course of the entire economy. The idea that this problem is too hard to solve holds no water. They can tackle this as well as they do any other challenge. And if their hearts are in the right place, they will.
Denise Hamilton (@watchherworktv) is an inclusion strategist and author of Do Something: An Ally’s Guide to Changing Themselves So They Can Change the World. She is CEO and founder of WatchHerWork, a multimedia platform closing the achievement gap for professional women.
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