Despite political rancor and the threat of companies reneging on diversity, equity and inclusion initiatives, some financial services firms are opting to stay the course.
Angela Harrell, the chief diversity and corporate impact officer with Voya Financial, said many of the companies that committed to DEI-related measures in the aftermath of George Floyd’s murder in 2020 were pulling back.
But she called for wealth management firms to double down, speaking at a DEI-focused think tank held last week in conjunction with the 2024 WealthManagement.com Industry Awards in New York City.
While some companies have pulled back from DEI, Harrell said there are far more that have continued with these initiatives.
DEI policies and terminology have long been targets of criticism, with former President Donald Trump and Elon Musk among the conservatives decrying DEI.
According to CNN, several significant brands, including Lowe’s, Ford and Molson Coors, recently scaled back DEI-related initiatives. In a Bloomberg editorial last year, one writer questioned whether DEI initiatives are “luxury goods in a corporate world that is no longer completely convinced they offer value.”
According to George Nichols, the president and CEO of the American College of Financial Services, the newest effort to rebrand or replace DEI touted by Musk and others in the tech space is merit, excellence and intelligence, or “MEI.”
However, Nichols said he’d spoken to CEOs who said their challenge was managing the “message of the narrative.” That said, they aren’t changing course on trying to make the industry more diverse. According to the American College’s assessment of Census information, as of 2021, 69% of financial advisors were male, and 80% were white.
“When people ask, I say, ‘Call it whatever makes you happy; I’m staying the course of where this is,’” Nichols said during the panel discussion.
Nichols said the industry was even falling short for white males, pointing to what he said were “awful” retention numbers in the space.
“Just think, if all we recruited were white males, we failed them,” Nichols said. “So why would you think if we bring in women and people of color that have less exposure and less awareness into that system that we’re going to be successful?”
Instead, Nichols argued that dismal attrition statistics indicated the industry needs to “rethink the system” it is bringing new advisors into if they will be successful.
Since joining Janney Montgomery Scott about two years ago, Erika Whyte, a vice president and the firm’s DEI director, said she’d not been tasked with “watering down” language about the firm’s diversity commitments. She said the firm’s president and executive team were “anchored” in the message and knew how to address advisors who disagreed with it.
“People are going to try to poke holes in it; you can try, and trust me, they have,” she said. “But there’s nothing for us to change.”
Whyte also said responding to critics, even when they use personally and professionally offensive language, was essential to making them understand that those messages are not “going to go off into the abyss.”
“What I won’t do is allow that bully pulpit to go unchecked,” she said.
Whyte’s approach is to acknowledge the message. And she also offers to meet with the person so they can respectfully continue the conversation face-to-face.
“I’ve not once, in my two years, been taken up on that offer,” she said.
