Black Advancement in Financial Services: Time to Follow Through
Whether it's a movie review or vacation advice, we're inclined to believe that the people we're close to won't steer us wrong. So when years ago, a friend suggested I apply to work at his insurance company, I took his advice to heart.
It wasn't just his friendship that made me trust his recommendation; it was also the color of his skin. My friend is black, and his recommendation carried some weight because he looked like me. Because he’s a person of color who felt accepted and included at the company, I felt like I, too, could fit in.
It's an open secret that people of color including African Americans approach insurance firms, banks and other financial institutions with a good degree of apprehension. The simple reason? We literally don't see ourselves there. Though there has been some progress in the hiring and promotion of people of color in the years since I started in the industry, minorities largely are still underrepresented, particularly in the case of African Americans. A 2017 report by the Government Accountability Office found that while overall representation of minorities in the financial services industry had increased since 2007, representation of African Americans in management positions had actually declined.1
What this tells me is that while there may well have been good-faith efforts by the industry to diversify the workforce through recruitment, there hasn’t been enough intentionality and follow-through to ensure that African Americans are getting the right opportunities to encourage advancement in their respective organizations. What should such opportunities look like? Mentorship and sponsorship is especially important because African Americans and other people of non-dominant groups — that is, people of color working at companies where most employees and managers are white — may not have natural connections to mentors in the corporate world. They're less likely to have lived in the same neighborhoods, attended the same schools, and share mutual friends with managers and leaders at their companies. Members of non-dominant groups may not have people they can turn to for advice on navigating an office environment. They may also be less likely to have higher-ranking employees reaching out to them, offering to take them under their wing (due to the small number of them in positions of influence). It's human nature to feel more comfortable around those who you have more in common with, and so a male manager may feel more inclined to go to lunch with a young man who went to his alma mater than a young woman of color who attended an unfamiliar school.
For these reasons, it is important for companies to have multi-pronged strategies in place to foster the right type of environments and to help create connections that might otherwise not exist. One such strategy that I’ve seen work is investing in employee networks or resource groups for people of color. Through such networks, employees can find connections and a support system that allows them to discuss their common struggles, seek advice and ask questions in a safe space. The networks can help employees find mentors, either within the company or outside of it through professional organizations; they provide opportunities to meet senior leaders and executives as well as other professional development opportunities that otherwise would be hard to access. As an example, State Street's Black Professionals Group (BPG) often partners with the National Black MBA Association (NBMBAA) and the National Association of Black Accountants (NABA) to promote mentoring, networking, and other career and personal development opportunities. In addition, the guidance employees receive within their networks and from their mentors can help them position themselves to impress potential sponsors — people with the power to advocate for their advancement.
I have benefited from employee networks, mentorships and sponsorships throughout my career, including here at State Street. Several years ago, when I was a vice president at State Street, I was paired with a Management Committee member who acted as my sponsor, giving me great visibility among C-level executives at the company and helping position me for my next promotion. Throughout our careers many of us are told that we “should own” our careers, and while it is true that we should create our own path, this is hardly ever achieved alone. I’ve been fortunate to have had the opportunity to develop relationships that have been beneficial to my career, and as I've ascended I've worked to bring others along with me, acting as a mentor and sponsor for others including many people of color. However, in order to change the landscape in financial services, it will take an all-out and relentless effort with multi-pronged strategies. Supporting our employee networks so that in turn they are taking the career and internal mobility of their members as one of their strategic priorities is one approach.
Organizations that aren’t intentional and strategic will be unlikely to reach their inclusion and diversity aspirations through mentoring and sponsorships alone. These important initiatives must be bookended by other approaches including: smart recruitment strategies and buy-in from senior leadership. For the former, companies must take care to have a presence at events hosted by professional organizations, Historically Black Colleges and Universities, and other venues where people of color are likely to be. (I'm proud to note that even before joining State Street, I frequently ran into State Street representatives at such events.) For the latter, companies must secure commitments from their leadership to embrace inclusion as a driver of cultural change, in addition to diversity goals that help ensure adequate levels of representation across the board. They need to be intentional and proactive in attracting, hiring and retaining people of color for senior roles in the same way they are intentional and proactive about increasing market share, or gaining higher revenues, or larger client engagements.
At State Street, we're committed to following all of these approaches to achieve our own inclusion and diversity goals. We also recognize that creating a globally inclusive workforce must become a priority across the industry. By continuing to put our best foot forward, we aim to set a clear example for peer organizations. Together, we can create a future where African Americans and other people of color are no longer underrepresented at financial institutions and the corporate world at large. It's time for us to see ourselves everywhere.
1. Barnes, Cindy Brown. “Diversity in the Technology Sector: Federal Agencies Could Improve Oversight of Equal Employment Opportunity Requirements.” US Government Accountability Office. Retrieved from https://www.gao.gov/assets/690/688460.pdf (retrieved February 20, 2019).
Paul is the Chief Diversity Officer and Head of Workforce Development Programs at State Street Corporation. He leads the implementation of State Street’s global diversity, equity and inclusion strategies. Recently, Paul was appointed by Massachusetts Governor, Charlie Baker, to serve on the Black Advisory Board Commission.