It’s hard to think of an issue that has become such a powerful a driver of the cultural evolution of financial services companies as diversity, equity and inclusion. The passion and energy of executives to make meaningful change is real, and they are making good progress on many aspects of DEI. There is, however, much more work to do—a determined, long-term commitment to DEI is critically important to make a sustainable difference in this industry.
DEI strategy is the foundation of fostering an inclusive workplace culture that meets employee, customer and shareholder expectations. The only way to accomplish this is to build teams with diverse backgrounds, thoughts and beliefs in an environment of respect, all leading to more effective collaboration and stronger business results.
BAI has made a significant commitment to help financial services leaders better understand DEI issues by providing data, resources and insights, and by encouraging collaboration across the industry. We have learned so much about the issues through our research and in our work with executives from more than 30 major banks, along with many thought leaders and policy experts who are focused on making more progress on DEI.
1. Inclusive means inclusive: Think broadly in 2021
While being focused works well in some situations, when it comes to DEI, the most impactful strategic initiatives include a very broad definition of diversity—ethnicity, race, gender, age, geography, religion, economic status, sexual orientation, veterans and active military, political beliefs, people with disabilities and others. DEI isn’t just about this group or that group—it is essential to build a culture that embraces all types of differences.
What we know about diversity is that different people have different views, different concerns and different expectations. That’s the point. Executives who broadly define diversity must understand and embrace the unique perspectives of diverse segments. Their ability to effectively listen, understand and act will drive their progress or hold them back.
2. Mobilize to maximize: The C-suite can’t do this alone
DEI isn’t a project to be delegated to a department or a committee. Involvement and commitment to DEI objectives are needed throughout the organization, starting at the top but permeating all levels. If a culture is truly inclusive, DEI becomes a purpose that is meaningful across the entire enterprise, from the board of directors and senior management to the newest entry-level employees. Everyone can make a difference.
The organization’s policies have a direct and different impact on its employees at all levels. To build energy for DEI within their financial institution, leaders must be deliberate and creative in the support they provide, particularly for women who appear to have been the most impacted by the pandemic. A key priority in 2021 will be in creating new ways for women to work, which benefits the organization, the community and the overall economy.
3. Set goals and track progress: You find what you measure
Most financial services companies are analytically driven and led by goal-oriented executives who regularly use data and comparative metrics to manage risks and make decisions about strategic directions, priorities and investments. It’s the way they do business, and DEI shouldn’t be any different. One of the most important steps an organization can take is to establish goals with clear metrics to assess and report progress.
It’s so important in 2021 to continue to demonstrate the passionate commitment for diversity, equity and inclusion that financial services companies have had this year. Building on progress in 2020, the greatest impact will be created by three key priorities: defining diversity in very broad terms, mobilizing your entire organization, and establishing metrics to measure your progress and promote transparency throughout your organization.
We all look ahead to 2021 to be a better year in many ways. These are the steps can make 2021 a year of even greater DEI accomplishments in the financial services industry.
Additional DEI insights from industry leaders
“As we transform our DEI commitments into action, we believe it is crucial to focus efforts on our colleagues, our customers and the communities we serve. To make steady progress in these areas, priorities should include hiring, developing, advancing and retaining a diverse workforce; ensuring products and services are inclusive to all current and potential customers; and investing in diverse communities to help cultivate economic prosperity.” — Fellicia Foster, U.S. head of inclusion and diversity, BMO Harris Bank
“The most effective way to achieve diversity, equity and inclusion is to treat people based on characteristics that unify rather than divide them. For example, banks that serve the active military and veteran communities know that a powerful unifying characteristic of these customers is service to our nation. Banks that understand and recognize the sacrifices that have been made are better able to serve the different and unique needs of military customers.” — Steven J. Lepper, Major General, USAF (ret.), president and CEO, Association of Military Banks of America
“Middle managers are vitally important to your ability to make substantive DEI progress because they provide such a valuable link between executives and entry-level staff. Leverage the connections they have, define their roles, prepare them with training and clarify their accountability. They may become the most influential role models on your team.” — Diane T. Ashley, CEO, DTA Diversity Counts; former chief diversity officer, Federal Reserve Bank of New York
“Financial services leaders must take deliberate actions focused on DEI and gender equality, including new approaches that enable more choices about where, when and how women work. Different work structures can provide tangible benefits that help women juggle family and work responsibilities. A critical step is to establish metrics that help assess progress in gender equity while increasing the transparency of outcomes.” — Teresa Tanner, CEO and founder, Reserve Squad; former executive vice president and CAO, Fifth Third Bank
“You get what you measure and DEI metrics that move the needle must be tracked over time. This provides a clear view of what progress is being made or what actions aren’t having the desired effects. It’s the only way to have actionable data so you can make the best decisions to position your organization to achieve your DEI goals.” — Karl Dahlgren, managing director, research, BAI
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