Recently, the House Committee on Financial Services held a hearing to examine the business practices of our nation’s largest financial institutions. During the hearing, U.S. Congresswoman Joyce Beatty (OH-03), Chair of the Financial Services Diversity and Inclusion Subcommittee, focused her line of questioning on each financial institution’s commitment to hiring, mentoring, and promoting professionals from a variety of backgrounds to more management and leadership positions. At the conclusion of the hearing, Beatty issued the following statement:
“In order for our economy to work better for everyone, those that help run it need to better reflect the unique experiences and backgrounds of all Americans. This begins with the professionals we entrust to protect and invest our hard-earned money, but according to a study by Harvard University, women-owned and minority-owned firms with at least 25 percent ownership manage less than two percent of all total assets under management. This stark lack of diversity leaves potential returns on the table. That is why as chair of the Diversity and Inclusion Subcommittee, I am looking forward to working with financial institutions and their executives to better leverage diverse perspectives, skills, and talents that will benefit employees and their bottom line—and as a result strengthen our economy.”
The hearing comes at a time when the financial services industry continues to face criticism for the lack of women and minorities on corporate boards, in the c-suite and other senior-level positions. In fact, African-Americans currently make up 11 percent of financial services workforce, but only 2 percent of executive and senior-level officials and managers. Moreover, women represent less than 30 percent of senior management positions at financial firms and approximately 36 percent of senior management positions at financial regulators. Furthermore, only 11 percent of financial firms and 17 percent of financial regulators employed minorities in senior management positions.
“As Financial Services Diversity and Inclusion Chair, ensuring the financial services industry works better for all Americans is of upmost concern to me, my Committee colleagues, and constituents,” Beatty said. “One proven strategy to move the needle in the right direction is by making diversity and inclusion part of the overall fabric of the companies and industries that are the lifeblood of our economy.” Beatty continued, “I have spoken with several bank executives on this topic recently, including several of today’s witnesses, and am pleased that each pledged their commitment to creating more ladders of opportunity for everyone in their organization. This is certainly ‘headline news’ for me and the nearly 135,000 Central Ohioans working in the financial services industry, as well as the countless highly-qualified professionals across the country who just need an opportunity to showcase their talents and skills. So, I take exception to the notion by Ranking Member McHenry that this hearing is little more than an effort to ‘make headlines.’”
Hearing witnesses included: Michael Corbat, CEO, Citigroup; James Dimon, Chairman and CEO, JP Morgan Chase; James Gorman, Chairman and CEO, Morgan Stanley; Brian Moynihan, Chairman and CEO, Bank of America; Ronald O’Hanley, President and CEO, State Street Corporation; Charles Scharf, Chairman and CEO, Bank of New York Mellon; and David Solomon, Chairman and CEO, Goldman Sachs