Speaking to a data-driven audience at the Options Industry Conference in San Antonio, Nicole Robinson, Associate Partner at McKinsey & Company, presented a bottom-line rationale as to why companies should prioritize Diversity, Equity & Inclusion.
Beyond just doing the right thing, Robinson said firms – in financial services as well as other industries – want to know what is the business case for DE&I.
According to Robinson, McKinsey research shows that over a several-year timeframe, racially diverse companies are 35% more likely to outperform their less diverse counterparts, while from a gender standpoint, companies with strong women representation are 25% more likely to outperform.
Robinson spoke Wednesday afternoon on the “Diversity, Equity and Inclusion: Strides in the Industry” panel. She was joined by Bevon Joseph, Executive Director and Co-Founder, Greenwood Project, and Carla Dawson, Chief Human Resources Officer, OCC. The panel was moderated by Elizabeth King, President, ESG & Chief Regulatory Officer, Intercontinental Exchange.
Further, Robinson said employees are three times more likely to stay at, and recommend, diverse companies, an important metric in what has been a tight labor market.
Dawson said beyond just gender and race, a diverse workforce brings a diversity of thought. “To the degree companies can engage their workforce and take advantage of this, it can be a competitive advantage,” she said.
For DE&I initiatives, OCC focuses on resources, data, and goals, Dawson said. “DEI is not a project, it’s a journey,” she said.
Greenwood Project, founded in 2016, that connects diverse, underserved young people, starting at junior year of high school through college graduation, with financial services firms for learning, internships and employment. The organization has helped 550 young people and has more than 50 corporate partners.
“My lens is young talent who would otherwise be disconnected with the industry,” Joseph said. “We help companies reach a talent pool they would not otherwise be connected with. We tell companies that there’s no lack of talent – what there is is a lack of opportunity.”
“Our vision is to see the financial industry with no barriers to entry or advancement for people of color,” Joseph said.
With regard to women in the workforce, Robinson said financial services is slightly ahead of the U.S. corporate sector overall, but while entry-level representation is at 52%, that number falls to 44% at the manager level and continues to decline, all the way to 26% in the C-Suite.
“What the industry suffers from is broken rung, and this makes the pipeline leak,” Robinson said. “The first promotion being held back has a lasting impact on the pipeline.”
Robinson added that companies need to implement DE&I initiatives authentically, or else they will lose credibility with their employees. “Employees are very perceptive of inauthenticity,” she said.
And at the individual level, while 77% of people say they are allies of DE&I, only about 10-20% actively work for it. “There is a big disconnect,” Robinson said.
