NCRC Just Economy Conference 2022 — Recorded June 13, 2022
NCRC Racial Economic Equity Director Joshua Devine, JPMorgan Chase’s Daniel Okonkwo and Citi Bank’s Ariel Meyerstein discussed recent efforts to improve, expand and better target corporate philanthropic investments to communities of color and ensure that ground-level resources are being routed through organizations led by people of color.
Moderator: Joshua Devine, Director of Racial Economic Equity, NCRC
Speakers: R. Daniel Okonkwo, East Regional Executive, Global Philanthropy, JPMorgan Chase & Co.; Ariel Meyerstein, SVP, US Business Partnerships – Community Investing & Development, Citi Bank
NCRC video transcripts are produced by a third-party transcription service and may contain errors. They are lightly edited for style and clarity
If I learned anything about the last session is to leave time for questions. If it was just as live, if this session is just as lively as last session, they’re gonna have a really good time. But thank you all so much. For one attending our annual conference, it’s really good to see you all. See your faces in person, even with mask on, I can feel your energy. And that’s so cool. My name is Joshua Devine. I’m the Director of Racial Economic Equity at NCRC. I am joined by two of these distinguished gentlemen, Daniel Okonkwo, and Ariel Meyerstein, who share a little bit about themselves in the work in just a bit. But thank you all for joining our conversation. Today, I want to provide just a little bit of a housekeeping rules, we will do a question and answer after our discussion today. We welcome questions for those who are interested in asking them, but the mic that you see in the middle of the room. But there’s also our conference app, if you go into the app, click on this particular set section or session, you’ll see a section that says live q&a. As we engage in conversation, we welcome you to submit your questions through the conference app. And I will do my best as a moderator to make sure that we are answering your questions, and I’m leaving enough time for conversation here. I also think is really important before we start to set some context for why this conversation is so important today. So as I mentioned, I head up our racial economic equity team. And we are charged with really helping to help our members helping stakeholders helping partners really understand racial wealth, racial inequality, the challenges and opportunities that exists within the space and in the solutions really, to help bridge our nation’s racial wealth divide. And we do this through a number of ways we support research and analysis that helps contextualize the issues that we’re facing now. And how the solutions that are being piloted, or programs is actually making an impact. Locally, we have a really cool research team that we partner closely with, as well as members like yourselves who are doing really interesting work on the ground. We also do a lot of wealth building incubation, I like to call it where we kind of just discover and explore where there are unique models of wealth building strategies and solutions happened on the ground, once we discovered those strategies are our goal. And intent then is to figure out how do we resource those models? How do we scale them? How do we provide the necessary resources and infrastructure for communities who are seeking to replicate those models to do so. So that’s also a part of our mission and part of our job here. So if you are thinking about, you know, cooperatives to support immigrant entrepreneurs, as they’re doing some really cool work in Twin Cities, shout out to those folks who are in that area. Or if you’re thinking about procurement and government contracting, how to connect small businesses to those opportunities, some really cool things happen in Atlanta, shout out to those folks who are in that particular region. Our job is to figure out, Okay, what’s working well in this space and how to replicate and scale. We also work with our corporate partners across the organization to ensure that equity is not only framed in the right way, but investments and programs and products and services, are actually meeting the needs of the communities that we are advocating for.
A few years ago, we developed a racial and ethnic representation and investment framework to really help us guide this work. And across this framework are five key pillars that we do our best to incorporate as we do our work in policy and research, and advocacy and organizing. We support the work of corporations who are interested in really supporting diversity across their teams, whether that be in management, and C suite executives, and even at the board level, knowing that if they’re centering equity at the governance side of things, then that can lead and we hope that it can lead to tangible, equitable products, services and design and impacting communities that we’re advocating for. The second pillar really is around equitable products and services. We want to make sure that as we are as institutions are seeking to provide services and resources to economically vulnerable and historically disenfranchised households and communities that we do this well. So we use our research to inform that particular work in that particular design. We also work closely with our partners to ensure that there is some sort of equity framework that’s guiding the work, whether it’s workforce diversity within their organization, or perhaps procurement or diverse supply chains, for example, we have an incredible policy shop that’s been advocating for policy reform and new policies to really center around ensuring that we are addressing racial wealth and racial inequality in America and in the communities that we’re serving. And then lastly, we really seek to guide philanthropic input estimates in financial community investments, targeting to communities of color in communities that need that funding the most. So we utilize, again, our research and our intel, our power of our convening to really support and align resources. Where needed in today’s conversation will be around philanthropy and investments. We are currently this year working on a project to help understand the landscape of corporate equity commitments that have been committed by institutions over the past few years, particularly in light or post George Floyd, and during the nation’s racial reckoning. Not only are we working to summarize, or really summarize how much of these monetary commitments were made, but really explore in partnership. What has been working over the past two years since that time? What commitments have been made? What impact isn’t making on the ground? What models resources, what lessons learned? Can we gather to really support organizations like yourselves who are interested in thinking about getting closely connected to these investments, but also working with our partners to think about what does the future look like? What are we learning now that we could use and pivot accordingly? In the future, it is our hope, by the end of this year that we will really be able to establish a set of resources and tools that will support you all, as well as our corporate partners, as we all work towards this fight to advance racial equity. So our two sessions today focus on corporate responsibility. Our next section, session in the afternoon will be primarily focused on products and service innovation. Our partners at Beneficial State Foundation will be facilitating a conversation with M&T Bank, and Barclays about some of their programs that they’re they’re utilizing, that they believe are confidently addressing racial wealth and closing racial racial gaps and ensuring access to financial services and inclusion. So that’s the next section, the next session, this particular session, we want to take a kind of a high level overview, if you will, of just corporate racial equity commitments overall. And really talk with my fellow panelists here about their methods, how are they investing in communities? How are they ensuring that these investments are aligned with local needs in the community? How are they measuring their impact? What is what is that philosophy? What’s the approach they’re taking? And then what did they see our priorities in the future and and hopefully, the conversation that we have today is useful to all who who will be in attendance. So without further ado, I do want to give some time for our panelists to introduce themselves, share a little bit about their work, kind of the racial equity commitment portfolio, and then we’ll just take it over from there. So I’ll go with Daniel and then we’ll start with with Ariel.
Great is assigned to everyone hear me? All right, great. Well, first of all, good morning, everyone, and welcome to Washington, DC. Good morning, everyone. Welcome to Washington, DC Thank you just want to make sure we’re all I know these rooms can get hot, I just want to make sure everyone’s awake. My name is Daniel Okonkwo. I am the East Region Executive at JPMorgan Chase and our JPMorgan Chase foundation. So I lead our strategies and philanthropic investments on the east coast and a region that spans from Massachusetts to Miami. And, again, thank you all for coming to this important conversation. I think that this is an opportunity for us to have a dialogue that sometimes we don’t often get as proximate to each other. So I’m grateful to be here and grateful for to NCRC for for this opportunity. When we talk about racial equity commitments, I think one thing to recognize is it’s important that we’re actually saying those words, and I think at JPMorgan Chase, we made this commitment in the wake of George Floyd’s murder and the country’s racial wealth reckoning like many other corporations. And I think what we overall are trying to do is make sure that our engagement in this area is not just philanthropic, but that it becomes part of our corporations, a part of our banks business, as usual. And so our commitment and I’ll go through kind of the characteristics of it so that you can understand kind of where we’re coming from and where we’re looking to have an impact. While it mirrors the where we make our philanthropic investments. What is different is this is about business activity and how we are trying to change the way that our firms does business and supports black and brown communities across the country. So we made a $30 billion commitment that’s over five years. And that commitment is focused on four areas, homeownership and affordable housing. How do we grow small businesses, particularly those led by and serving black and brown communities? How are we improving the financial health of the communities in which we’re working? And how do we for ourselves build a more inclusive and diverse workforce. So again, across all those dimensions, we’re trying to make sure that this is about our business as well as our philanthropy. But that’s just the overall commitment. We also realized that it took, we had to make that commitment local, it wasn’t just enough to say, we have this commitment, and it will be nebulous, and no one knows how it affects them. Because I think often that’s the question. That’s great, I see these big numbers. And I imagine many of you here today may be wanting to have that same question answered. What does this mean, in my community? What does this mean in my city? So following that commitment, we stood up an entire organization to make that commitment, local. We, as we’re focusing on homeownership, we hired community home lending managers to focus on on black and brown communities. We hired Community Manager, community managers have built community focused branches, with event spaces to bring the community into our actual workspace, and put community managers there whose jobs are not just to engage in banking activity, but to actually be proactive, going out and interacting with local organizations, community groups, nonprofits in the same way that we do in our in our foundation. And finally, we also hired small business consultants. So folks who are focused on working with diverse business owners, to give them the technical assistance to grow and scale their businesses. So again, what we’re trying to do is make sure that we are not just putting out numbers, but that we are actually putting in place a mechanism for localizing that that commitment. One example of that is just here in Washington, DC. And so last year, following that, we also made a commitment to support this community. Both philanthropically and through our business to the tune of $75 million, just in just in this region. And that commitment, like the overall racial equity commitment is a mix of philanthropy and business. So we have a philanthropic commitment, but we’re also saying, we want to make sure that we are supporting affordable housing, with flexible, low cost patient capital, we want to make sure that we’re supporting small business owners and entrepreneurs in the same way. So again, that’s that is a broad overview. I look forward to continuing this conversation throughout the day. But thank you again for being here.
Can everyone hear me right? Now I need to speak up. Okay. Well, Daniel already warmed up the room. Is that better? Okay. I don’t have a problem using my voice, although I got a little hoarse over the weekend. So hopefully it holds up. Does this just just quickly? Yeah, I don’t have I don’t have a huge presentation, but just to help ground it a little bit. So I’m Ariel Meyerstein, in the US Business Partnerships team within Citi’s community investing and development function, which is part of our global public affairs team. I’m based here in DC actually, was formerly in the in our New York office, and I help lead our Action for Racial Equity, which we announced in September 2020, following the tragic murder of George Floyd, and, you know, as Daniel mentioned, that all of the events of that year, very similar to Daniel and JP Morgan, you know, we pulled together a task force within the company to figure out what our response to be would be, and very quickly decided that it could not stop with with mere philanthropy. And I do say mere philanthropy, because I do, you know, we very, very much agree with what Daniel said, the view is that, you know, philanthropy is necessary, obviously, but it’s obviously not enough. And to actually address systemic challenges and long patterns of behavior, you need to really embed practices within within the business and you need to change orientation of the firm or the business to make these commitments part of business as Daniel said, business as usual. And so our action for racial equity, which we announced in September 2020, really focuses for the most part on getting out through our products and services, impacts to communities of color. So it’s a billion dollars, plus in strategic commitments, 100 million of that is through our philanthropy, but the other chunk of it is through various pillars of activity, which are outlined on the slide. So expanding access to credit and banking in communities of color, supporting Black entrepreneurs, promoting affordable housing and home ownership and the last pillar is moving toward getting city to work towards becoming an antiracist institution and to advance antiracist practices within the financial sector. That’s very amorphous. But what it really means is thinking about our policies or procedures, where are there areas where we need to be very much more critical about what we finance or how we review things. It also means thinking about who we engage with as partners, whether it’s law firms, PR agencies. So we’ve developed a whole range of initiatives that really think about the DNA of the company. And this actually, we have a whole, we have a large array of other activity going on with respect to diversity, equity inclusion, it’s not actually, you know, formally part of action for racial equity, it’s all working alongside of it. So that’s a whole other kind of conversation we can have. But that’s not really the focus of this work. This is really about our business processes. I can, you know, I can go now or later into more detail about some of the different pillars depending on how you how–
I think we can get to it later in the conversation.
Okay, perfect. So maybe I’ll just stop there. Looking forward to to hearing your questions and enjoying the conversation.
Great. Well, thank you both for being here. I think it would be probably most appropriate to maybe just have that first initial question talking about methods in approach. So you mentioned earlier that, you know, it’s important to have or to talk about or even comment on racial equity, in the conversation actually mentioned it. And to your point about, you know, creating the institution as anti racist. I’m curious to know, like, as you were creating these racial equity priorities, what was it that informed your work? If you can maybe take me back to, you know, pre announcement if that unless that procedure, your tenure, or as you’re thinking about this work? Now? How does how does it inform your work? How do you How does it you as an institution define not only racial equity, but the priorities to kind of really close those racial wealth gaps?
Yeah, so I mean, I think, you know, number one, Citi has been actively engaged in communities where we do business for a long time, we have a lot of partnerships there, and also at the national level. So we have been listening for a very long time. So these issues that we identified for action, social equity, were not new to us. It’s not that we woke up in July of 2020, and said, Oh, gosh, we have to do something about this. It’s something that we’ve been addressing for a long time. It wasn’t, wasn’t totally part of the same process. But at the same time, Citi’s research team put out a report on racial inequality and kind of tried to put real numbers on the racial wealth gap. And so that report coming out, it’s, you know, around the same time was also very informative of the key areas that we would focus. And finally, we also had to think about, well, what is our business? You know, lots of companies have made commitments, but what what can we do through our business and the products and services that we offer to address the issue. And so I think that those were the real guideposts. As I said, these weren’t issues that we we had not been aware of before. And so we did have a set of priorities that we kind of knew naturally, were the areas that we needed to really focus even more, I’d say, there’s a very organic, wasn’t that we had to go out and study the problem for a long time, because we really, you know, we’re, we knew where we had to focus ourselves already.
Similar, similar to what Ariel mentioned, you know, this is, these are communities in which we were already doing business. And I think, pre-announcement, I think, what one thing we realized is that this is something that has to grow, this has to be this, we have to put a stake in the ground and make a bigger, more specific commitment to racial equity. And also, you know, we are we are members of the Business Roundtable, as that group and the CEOs in that group looked at what they could do with their companies, you know, we studied internally, where are we? Where can we do more? And so kind of this announcement grew out of that, that process. But again, you know, we are in what is it? June of 2022. We’re just into this commitment. So I think, you know, for for many of these institutions, we’re still on a journey to get there. And so I think conversations like this are important and why we made this commitment in in 2020. That’s not the end of the listening and dialogue that we want to be having.
That’s great to hear. You both mentioned that this work or this commitment or investment in racial equity has to go beyond just philanthropy and that the philanthropic work that you’re doing actually inspires or cause us to think about, you know how you as an institution can kind of change to support this particular work. I would like to talk a little bit or get into a little bit more gritty details around what that what that actually looks like. How do you How are you marrying what you’re doing on the philanthropic side? with what’s happening on the on the business side?
Sure, I can, I can take that. Well, so first of all, I think what I would would know is that on the philanthropic side, and I manage a team of market based program officers, so the folks on my team are sitting in communities, they’re not in one hub, building relationships from there, but they are they are walking and talking with folks in the communities in which which they’re based. So at the at the outset, what we’re doing is, is building those those local relationships, I mentioned some of the teams that we’ve hired as a part of this commitment. And those teams are working hand in hand with the folks on our philanthropic side. So they’re not, we don’t have one team, working in one area of a city or in a subject matter and another, they’re working together, often with some of the same organizations, so that we’re hearing the same challenges, we’re sourcing the same opportunities, we’re able to craft collaborative solutions together. And so I think, when we look at how we’re infusing this into our business, sometimes those relationships start on the philanthropic side. And that is a way to gather information, because that’s where those relationships exist. But what we’re also doing is introducing the folks on our business side, and really trying to break down that wall. So I wouldn’t have to come here and say the business versus the philanthropic side. But it does start with a lot of local relationship building.
I think part of what we’re doing, I wouldn’t say it’s a deliberate mirroring per se, but it’s more about execution. So as an example, under pillar one expanding access to credit, there’s two main buckets of activity there. One is with minority depository institutions. And the other is through a variety of what we call social finance products and services like our access account into and we also have a children’s savings account. And with both of those two programs, we really rely on community partners to help roll them out. With respect to the children’s savings account, that’s really a partnership with municipalities in a number of cities already have it in place, San Jose, San Francisco, LA. And we do rely we are working with municipality but also with partner organizations on the ground to make sure that people know about the account that they can learn about how to use it and activate it and get started with it. So it’s very much a partnership in that way. It is ultimately a business product that you can’t sit with us. But we use the community, community groups to help execute. Same thing with the Access account. So that’s I think one element of it. The other element, I would say is looking at it more again, from an ecosystem perspective, through Citi Foundation, we’ve done a tremendous amount of support to community development, financial institutions, CDFIs. And that, you know, we’re giving unrestricted funding, we also just did a call for proposals, which I can get into later to support them and their work. But there are potentially other opportunities for us to support them more from a business angle. And so we also developed something called Bridge built by Citi, which is an online platform, Citi doesn’t, we developed it internally, you know, all of our own costs, we don’t make any money off of it, it’s essentially a connection place. We’ve on boarded almost 30, CDFIs and MTDIs onto the platform. And what it does is it creates deal flow for them. So people who want to get small business loans, the it extends their reach into communities that they might not be able to, to reach into whether their immediate market or elsewhere and allow small businesses who otherwise would only be limited to whatever institution might be down the street from them access to a broader array of CDFIs or emptyeyes, to bank with and to get small business loans. So if you look at it from an ecosystem perspective, with our philanthropic commitments, we can say okay, we want to support CDFIs that want to do innovative financing or want to help their communities in new ways. But then we have other solutions on the business side that can kind of pick up that activity and help it scale. I wish I could say that that was part of like a grand master plan. Obviously we’re very, you know, huge, you know, huge institution and a lot of things going on, but More and more, there are people like me working within the bank who are specifically trying to connect those dots. So that we can take some little pilots that might, you know, might happen in one place and or another and see how we can, you know, learn from those and do something bigger and better on a wider scale.
You You mentioned ecosystems, and you just mentioned pilots, and it creates this question in my head around as you’re doing this work? How are you approaching this work geographically? Are you? Are you finding communities that are most in need of like housing or small business lending products, for example? Or are you are just talking a little bit more about how you’re thinking about this work geographically? And maybe this is a first question to you, Daniel, since you’ve committed 75 million to the region, curious to know how that came about? And why why this region? Etc?
Sure, I’ll try and take those in in order. I think one of the things that we do have priority markets. So we have about 15 priority markets across the country. Those are developed by looking at what are those challenges? What are those opportunities there? Where can we have the biggest impact? I think when we when we look at this work, we want to make sure not that it is again, like I said, a commitment, but that we’re actually able to, to drive impact. When we look at the Greater Washington region, and I know, you know that folks in this room are from all over the country, the racial wealth divide is big, in a lot of places. So I’m not saying that DC is is bigger, or that it’s more stark than anywhere else. But it is big, and it is stark. And so given that we had focused our efforts here, for those of you familiar with the area in Ward Seven, in Ward Eight, we had made a commitment in 2018, of about $20 million to that geography. And we expanded that, in subsequent years looking at a more of a regional inclusive economic model, what would it take to drive a more inclusive economy across the region, recognizing that there are many things that are intertwined, transportation, education, health care, many of the many of those of us who live in this region aren’t just affected by what happens in one particular geography. So when we looked at the scale of this geography, we wanted to have a commitment that that match that. And so that is why we we looked at the Greater Washington region and made that that new commitment. Sounds good.
Yeah, I would say similarly, you know, we were active in six major markets across the country. And that is where we tried to very, I would say, proportionately, focus our energy. We don’t necessarily prioritize one market over another. We have community, great community relations team, it’s on the on the ground, and some of them are in the room today. So say hi to them. But, you know, they’re operating across the country in those six major markets, and engaging with communities in those in those markets. And that’s really where we try to roll out the programs. But back to the pilot point, you know, partnerships, in particular, very challenging to do as many of you know, and so sometimes you do have to lead first in one place, so that you can get it can happen, you can learn, you can iron out the kinks, and then you can take it elsewhere, and obviously trying to do it in too many places at once from the get go. It doesn’t necessarily work and you can’t learn in the same way. And just from a resources perspective, it’s challenging to do that. But back to one other thing I failed to mention. And in my last comments around the public, private and kind of the the boundary, the work that we did during the pandemic, with community development, financial institutions and other community organizations to help them address the pressing needs that they were seeing on the ground and their communities. We donated the proceeds from our PPP loan program into their into the foundation to do that work. So it’s 25 million. And so it’s kind of going the other direction. But it’s another example of how I, you know, it’s, I’d say it’s a fluid ecosystems, I keep using the word but the way the work gets done,
I want to circle back to an earlier point you made around community partnerships in or how you’re doing community partnerships, Daniel, and when we talk to our members about this particular work, and you know, whether or not they are getting access to these funds, if they’re if if these funds are making an impact on the ground, there’s a lot of thoughts that resonate around, making sure that we have access, right. How do we get in to relationship with with our institutions who are doing these major commitments? How do we talk to them about our local priorities and how best to to that they can respond and I’m just curious to know and maybe you can even provide some examples of how community partnerships on the groundwork for your for your for this particular work?
Sure, sure. Happy to that answer that and I would say, first of all, you know, you may know or you may not know, on the philanthropic side, we don’t have like some family Foundation’s open grant applications on our our website. I see some heads, not some, maybe some people have looked for that. But what like I said earlier, what we do have is we do have individuals in and program officers in our markets, what they try and do is, is have those local meetings with folks. And, and that really, that’s one way that that those relationships can be built. One of the other things that I mentioned earlier, as as we build out these community impact teams, is that we are trying to provide more on ramps and more relationships points with JPMorgan Chase. So between our small business advisors, our community home lending managers, our community branch managers, those there are more opportunities to to build those relationships. As far as specific examples, you know, I have, I have many, some of them are slipping my mind right now. But in in this region, we’re working in Baltimore, with an organization called parity homes that is working to build affordable housing in West Baltimore. And that relationship started ultimately through our JPMorgan Chase Policy Center who was working, looking at housing and appraisal gaps and parody homes founder Reed Jones, had really identified a particular issue in Baltimore, where homes were appraising for far less than, than they should, and through our Policy Center, was able to kind of support her work and the work of those in Maryland who are working on that, that issue. That led to a relationship where parody homes and another or a number of organizations in West Baltimore, we’re recipients of our advancing cities grant, so a $5 million grant to support affordable housing in West Baltimore, and in particular, women of color builders and developers. So that’s just one particular example of how relationships can start. Josh, you also mentioned pilots, and I think one of the things that that we try and work on is kind of a plan pilot scale model. So as you as we look at what’s happening in communities, how can we get the data and the information so that we’re having an accurate view of what’s what’s happening there, from the folks on the ground? And then from there trying to put together what are those? What are those collaborative pilots? What are those what what is that programming that can start to get at some of those, those challenges? And then if if it’s successful, then looking at how do you scale that model? Maybe in that community, but maybe another? So that’s a little I know, you talked about methodology earlier. That’s one way that we try and look at this, at least on the philanthropic side.
Sure. Sure. Sure. Did you want to answer that question?
We can move on.
Okay. So you you mentioned assessing pilots and understanding data around it? And again, there’s a question in my head around, how do we measure impact of all of this work? Measuring impact of a particular program is hard, at least for nonprofits, maybe with limited capacity to do so. So just curious to know as you’re doing this work, as you’re doing homeownership work on the ground or small business lending, what does impact look like for you all? And how do you how are you approaching measuring? You also mentioned earlier that, you know, this is still a start of the of the project, but two years in, so trying to figure this out, but would love to learn a little bit more from the both of you around the approach you’re taking to ensure that what you’re doing is making an impact on the ground?
Sure, I would say I’d look at this, I think we can look at this in in two different buckets. One on our racial equity commitment side and the our $30 billion commitment, what is the impact? How are we measuring how that commitment is, is being met? And so across the 15 target markets that we have, we are constantly collecting data from our business on loans originated, small businesses started financial health workshops held and those they’re you know, we love a good dashboard. So there are there are monthly dashboards that, that that contain that information. But I think one of the things, too, that that we’re doing is we’re also making sure that there’s accountability to this. And so our local business leaders and who are leading our lines of business are also asked to be part of operationalizing this so there isn’t one team over here doing this. There’s one racial act equity team. And then there’s our business team. Like I said, we’re trying to make this part of our business. So one, there’s the kind of how are we? We’re measuring the progress towards that commitment on a on a monthly and yearly basis. Second on the philanthropic side, as we, as we look at supporting and our foundation are programmatic funders, so we’re funding folks who are folks, organizations programs, we’re we’re we have developed a set of metrics that we asked grantees to look at and say, Well, if we if you’re funding in the affordable housing space, which of these metrics do you think your programs will get at? So while there are a menu of them, we are not prescribing every single metric that that folks have have to meet? And two other things I’ll mention. One, we’ve also started to incorporate qualitative metrics. So not just numbers, what are those things that you think as an organization, you’re going to do? Tell us what the impact that you think you’ll have, and then we can start a conversation from there. Second, is we’ve also started to build in the ability for capacity building and technical assistance. So if an organization says, you know, we want to do this work, we are the best people for this work. We’re proximate, we have the programming that we think will get there. But we also need some technical assistance or some capacity building support in this arena, we have the ability to provide that as well. So I think what we’re trying to do is not say to organization, here’s the bar, either you meet it or we can’t have a relationship, but we’re really looking at is, what is the impact that needs to happen in this community? And how can we help you to help to do the work that that you’re doing there?
Coupling investments with technical assistance and strengthen capacity is kind of a really important model, I think, to ensure that investments are just not one time, right. But they’re long term and sustained. And so it’s really cool to hear that. Ariel, any thoughts on how you’re approaching impact?
Yes. So I think there’s an impact measurement is challenging, obviously, if you’re trying to look at the question of like, are we making a dent, right, and the racial wealth gap, we can see different types of progress in different in different ways. Some of it, we, you know, we know that we’re doing a lot more activity with diverse financial institutions. So as an example, since 2020 85%, of our bond issuances, Citi corporate bond issuances for ourselves had been done with minority broker dealers, we know that is a uptick over the past, we’ve always worked with diverse broker dealers, but it’s steadily grown over the years. So we can measure that we’re also engaged, as I noted before, with law firm, all the law firms that work on Citi matters, getting them to measure the representation of the teams that work on our matters, and getting them to be more rigorous about that measurement. So that has a rippling, you know, ripple effect in terms of how they manage their business. It goes deeper than what they’re asked to do by other legal organizations. So we know that we’re asking questions that they haven’t faced before, and getting them to think more critically about it. On the philanthropic side, you know, a lot of the work I think has been driven by local needs, in the sense that we do have open calls. So we have done this open call for, to CDFIs for them to propose their innovative programs and for us to select among them. The the work that we’re doing with minority depository institutions, that’s really been, again, in the spirit of capacity building, so we made equity investments in in about 11 of them now. But we’ve also we’re also doing loan participation with them, to enable them to generate revenue. But we’re also doing a tremendous amount of work with them to develop their capacity and to build their organizations. So some of that you can measure in dollars and cents, we know we’ve given we’ve made our commitment, and we know that money is going out the door. And we’re tracking it, you know, very rigorously, we did agree back last fall to do a racial equity audit, which is focused on action for racial equity. And so we have invited in an external law firm and they’re basically interviewing everyone that’s involved with actual racial equity in any way, including external parties that we’re working with and supporting to get their view on how we’re progressing. If we’re saying if we’re doing what we said we would do, what can we learn from what we have done? How can we do a better in the future? We’ve also issued a number of reports on a six month basis, kind of detailing all of the efforts and things that we’ve been doing so we’ve been putting out the information about What’s happening? But back to what I said, you know, to kick it off? The, you know, measuring it what what impact is, I think is a complex? You know, question and it kind of depends, you know, in the situation of what you’re trying to identify as what you’re trying to measure and learn from, but a lot of I think, is focused on are we doing more, right with the different organizations that we’ve we’ve identified, and they might have the metrics that they use to evaluate what they think success is.
As you’re, as you’re thinking about the auditing process and finding ways to evaluate and understand if what we’re doing is making an impact. I’m curious to know what innovation looks like. And when we talked about innovation in prep for this call, we thought about it, and maybe not necessarily doing a new thing, but really going for what’s already happening and whether or not what’s already happening is actually making it if it’s working, how do we continue to do the work? And so as you’re, as you’re going through this work, and you’re about two years in, are there things that are are working well, that you feel would with additional investment or additional energy can really make an impact in the long term.
In terms of things, you know, working well, I would say the children’s savings accounts are, you know, a really great innovation and having a lot of success. And it’s really just a matter of, you know, people that ask people to roll it out across the country, it’s already in a number of cities, as I mentioned, and does over the long term, you know, there’s research that shows the potential impact in terms of people’s likelihood of going to college with savings in place, or even thinking about saving. So I think that that if we think about the, the intergenerational problem that we’re facing that that’s a great example. The other I think, when we think about innovation, the you know, I mentioned Bridge Built by Citi, that’s very innovative. It’s a tech platform, where we have an Impact Fund, which is focused, we had the fund before, it was $150 million fund, we then added another 50 million to it specifically for black founders. And now it could almost 40% of the fund is devoted to black founders. And they’re developing a lot of innovative solutions to address social social gaps of various kinds health, infrastructure, transportation, a lot around different act different ways of accessing financial services, alternative credit models tend to help to serve people build their credit identities. So there’s a lot of innovation happening in different ways. But I think for us, the most innovative thing, which isn’t really innovative, actually, is this what we started with, which is embedding this in the business. And so all of the work that we’re doing with the diverse various diverse financial institutions across the firm, whether it’s the minority broker dealers, or the minority depository institutions, or diverse asset managers, that’s all now being housed under a business team, a unit that’s become centralized, called our diverse financial institutions group. And if you look back, you know, the person who’s leading that team, Harold Butler, he began working with US Treasury a long time ago on on a trainee mentor protege program. And now we have a full comment program. We’ve already had one full comment year, we’ve got other secondees going out to be chief technology officers at minority depository institutions. So I see that as as innovation because we took something we took this germ of an idea, and now it’s fully fully funded business team. We’ve also created another business team in the in the Consumer Bank, called the financial inclusion and racial equity team. And it has the same mandate, market to and develop products for diverse segments, and in ways that we wouldn’t have seen it before. So one of the I’d say, positive outgrows of this intentional focus through action for equity is that we are trying to really innovate within the business and change chain practices.
Did you want to speak on innovation on the ground?
Sure, I can. I can add a little bit to what Ariel said. I think one of the things that we think about when he when you talk about innovation is where should innovate innovative solutions come from? And I think one of the things that we try and do is really sourced that from from you all from the communities that that we’re working in. So I mentioned earlier example, in Baltimore, we had an annual challenge called advancing cities, which awarded five to six three-to-five year $5 million grants for collaboratives that were working in communities to address particular problems. In previous years. It’s that we had kind of two tracks one was a systems change track and one was a place based tracks when the systems change track? What are those innovative solutions that can get at a systemic issue in a particular place? And on the system, excuse me on the place based track was what are those things that are that are one of those innovations that can address an acute issue in a hyperlocal geography? This year, I think we recognize that you know, what, as we look at equity, this might, requiring organizations to put together collaboratives may sometimes advantage certain sizes of organizations. So our challenge this year, we’ve taken a rethink and said, Now, this challenge is open to individual organizations. And we’re focusing on what are those solutions that can accelerate wealth building activities for women of color, knowing that coming out of the pandemic, households that were led by women of color suffered particularly at particularly worse than others, and we’re the least recovered demographic. And so we’ve said, communities, you tell us what the innovative solution is. And so that’s one thing I think about innovation, it’s kind of where does Where do those solutions come from? Secondly, one thing we’re trying to do on the business side, is make innovative uses of our capital. So we have an impact finance team that actually sits in corporate responsibility, it grew out of our investment bank, and what this team is doing is looking at how do we deploy our capital in new ways. So one, we’re making equity investments in early stage companies that are addressing solutions. That are they’re trying to get a solution for black and brown communities. But equity investments, those aren’t loans, they don’t need to be repaid, these are series A Series B investments. Secondly, we’re looking at, we call it we call it flexible capital. But these are lower than market market rate, longer term investments, particularly in the housing space, that allow for some for for for access to capital at a different place than our typical market rate. And third, one area that I think we’re innovating, at least internally is, is we’re starting to invest in funds all, you know, within the within the regulatory framework that we operate under. But what are those, particularly in housing? What are those funds that are working on solutions at scale? And so again, I think those are those are a number of ways we’re trying to think about innovation. But but one point, I think we talked about this, and in our pre conversation is that putting innovation in its right place, meaning that everything doesn’t have to be innovative, there are solutions that we know work. And so how are we lifting those up? Doubling, maybe tripling down on those as well, I think that has to be part of our work as well. And I think we’re trying to do that the best we can.
Yeah, I can’t underscore enough the need and value to local sourcing, right? Because there are organizations who have been doing this work for years, and could just use a to amplify or increase their visibility in some ways. I have a forward focus question. But I may want to pause here and maybe give an opportunity for folks who are in the audience who maybe asks a question to our panelist, and we will field a few.
OK, the gentleman there, first hand raised– Oh, there’s a there’s a there’s a mic right in the back? Yes. You sure can.
AUDIENCE MEMBER 48:41
Okay, so um, hello, great conversation. I’m from Atlanta, Georgia. I run a foundation called the entrepreneur Foundation. And we go speak to schools all across the country talking about entrepreneurship, but specifically, online. My thoughts on the conversation and getting funding is I truly believe that banks are much more favoritism to physical products than online products. So I would want to think what would be your insight on trying to get some type of funding for a product such as a, say, for example, we have an eight, eight year old YouTuber, he just made $24 million last year, which is a business or you have a tick tock or that has to find out different products and stuff like that, which is another business but I don’t think that traditional banks or traditional traditional funding, funders understand that the way that the world is going is digital and younger people pretty much understand the different products that we can push out. So what were your thoughts on that?
Sure that thank you for that, for that observation. And one thing I would say is that, I think we are starting to understand that and I know at least in our philanthropy that we have supported a number of online not just portals, but on Line navigators, particularly around workforce development. So how can we aggregate the resources in a particular area and couple that with a navigator, so that folks who are looking for work can access all the resources in in one place. But I think you make a very good point. And I think some of the technology is even going away from from websites into mobile technology. And I think we as as funders, and we as a business have to recognize that not all things will be 10 people sitting in a classroom, to get programming. And I think that’s something that’s that is an important point.
I would just add that, you know, our Impact Fund, similar to Daniel and JP Morgan’s, you know, it is equity investing, it’s early seed capital. For startup entrepreneurs, a lot of the tools that they are developing are all, you know, app based technology. So they’re not brick and mortar, they might be doing things in the real world, or obviously, the work that they’re doing has impacts in, you know, offline, but they are fundamentally kind of in the tech ecosystem. And that’s heavily influenced by the involvement of our Citi Ventures team, which has been part of the Impact Fund and helping it grow. So we’re very attuned to that. But it may be though, that, you know, that’s those are those are unique, right? There’s only there’s only some of them. And probably people in your community might have X Men have trouble getting the getting what they need to actually go to investors, venture capital, and others, they might not be looking for that kind of scale. Right. So what’s that intermediate solution? And I think that, you know, it’s an important point that you raised that, you know, we can take back, and I can’t speak to the rate at which we might fund you know, brick and mortar businesses versus things that are online. And from a philanthropic perspective, I don’t think we necessarily have a bias one way or the other some of the things that we do roll out services through, you know, virtually so. But I think it’s an important thing to keep going and to be mindful of, particularly as technology evolves, and people use it more and more. It’s something that we should always be focused on. Thank you.
Thank you for the question. Hello, hello.
AUDIENCE MEMBER 52:23
My name is Hamdi Abdullah, I am visiting from Seattle, Washington. Definitely. I see most of the work is based on here on the East Coast. But I would I would like to hear. And what about West Coast of the north or the south? The rest of the country? I hear you saying that? Especially Daniel, you said you’re you’re investing 30 million, billion dollars. And we just see that that is a very slow process. And 30 billion is not an easy money is a big money. But at the same time, we would like to hear at what rate at what credit and what speed, that money will come? Because, you know, every minute and every second counts. So that’s one question. The second question is there. There’s a slogan that always talks about how to reach people. The question is, who is hard to reach, everybody gets their money to the bank, whether it’s $10, or whether it’s a billion dollar. I believe that the billionaires and the rich people and the wealth people and zeros at the heart to reach people they need to be reached. And they need to let us know and follow, you know, the rate and the speed at which this money is going to be dropping and trickling down to the community. If you could say something about that, that would be great.
Sure, sure. Thank you for your comments. And one thing that out, I want to make sure that I’m clear on is that when I talk about our racial equity commitment, and our $30 billion commitment, as I said earlier, in my opening introduction, this was aimed at getting our impact into our business. And so our $30 billion commitment is a business activity commitment. It is not a $30 billion dollar philanthropic commitment. And I think that’s very important to know, out of that 30 billion, 2 billion of that is tagged for philanthropy, but the remaining 28 billion is for business activity. So how do we increase lending to prospective and current homeowners? How do we make access to capital more readily available for small business owners? So when we talk about the money getting to local communities, that’s activated through our through our bank now work our products and our services. I can say that as of, as of right now we’ve deployed about 18 billion of that $30 billion commitment. We’ve preserved over 100,000 units of affordable housing. So these things are starting to roll out to your first question on on the West Coast. I manage a team on the East Coast, I have I have a colleague who sits in San Francisco and manages similar philanthropic team on the west coast. But what we’re trying to do is work across the country to make sure that we’re rolling this racial equity commitment out in the four air impact areas that I mentioned. to your to your second point about about hard to reach. I think you’re right, that that CEOs are hard to reach. I think one thing that I’m heartened by JPMorgan Chase is that our CEO, was one of the leaders in internally at driving our racial equity commitment forward. I know, it’s one of the things that I talked about loving a good dashboard earlier. I know this is something that he gets a regular report out and has put in some of the accountability structures around around that. So we are not by no means where we need to be, but we’re certainly trying to get there.
AUDIENCE MEMBER 56:22
Good afternoon. I’m Tammy Thompson, from Pittsburgh, Pennsylvania. I have a question. First, I want to say that I commend a lot of corporations for their recent attempts at good DNI work. But I do want to ask more specifically, are you can you speak to the work that’s being done to work with individual team members and their implicit biases that they bring to the workplace that really are some of the drivers of disinvestment in black communities and black families.
I can speak to that a little bit. So actually, as I’ve noted before, the actual official equity itself doesn’t include our di work, which happens through a separate stream, we do have a chief diversity officer, Erika Irish Brown. But the work really actually goes back several years, we were the first bank, and one of the first companies to do gender and racial pay gap analysis on an adjusted and unadjusted basis, and said, and we said representation goals, which we just met our first round of representation goals for senior employees at Citi earlier this year. So initial starts, at least in terms of addressing the pay gap issue. We also have unconscious bias training. That’s all part of all employees training to get unconscious bias training. But there’s also been over the years special kind of dedicated programs for more senior executives. So I think it’s something that, you know, we’re working on the last thing I’ll say is as part of action for racial equity, I noted a number of things already done with law firms, which is outside of the firm. But we also have for our city mortgage business, been growing our community loan officer network, and also trying to work more and more with syndicate banks. So we’re trying to develop the expertise in house to make sure that we can engage with the local communities, but also to think more strategically. And I mentioned, you know, the front, the teams that we created the diverse financial institutions group and the financial inclusion racial equity teams. They’re there to kind of bring that focus. We also developed a team called the racial equity and data and Design Initiative, which is focused on racial bias in products in the design process. And so there’s a number of different ways that we’re trying to get at that very hard to get at issue. Thank you.
AUDIENCE MEMBER 59:12
Hi, my name is Bridget Tate. And I had a couple of questions. I’m going to try to pare it down, though. I want to thank both of you for the information that you’ve shared. I’m coming from a philanthropy kind of question and understanding city, I appreciate all the things that you’ve noted that the changes that you’ve made in order to make sure that who you’re partnering with is aligned with what you’re doing internally. To JP Morgan, my question is, knowing that how philanthropy is done currently with JP Morgan, and that we’re continuing to use the word racial equity in this conversation, and that this is just two years in the coming based on everything that happened externally. What are you doing JP Morgan in regards to making sure that you’re elevating and giving access to black owned and run nonprofits that are truly working within community, because my experience I’ve stood here for over 20 something years in the space is that this particular kind of cycle, as far as grant giving means that these are relationships that you’ve built. We know that money goes to white run organizations, we know this. So what are we doing to elevate to make sure that because it’s not open, and you’re not, you know, setting up a situation where you’re able to partner and have conversations with black nonprofits? How are you bringing them to the table?
That’s, that’s one question was that there’s a semicolon?
AUDIENCE MEMBER 1:00:40
And the second question is, how are you assuring that where your money is currently going? In regards to racial equity and what you’re doing internally and holding yourself accountable for? How are you holding your grantees accountable for racial equity work, whether it’s in their board? Question, whether it’s in the work that they do internally, with their staff, and diversity within your senior leadership team? Are you doing anything? Do you have any type of tool that you’re utilizing when giving grants to assure that the organizations that are white LED, are doing the work necessary to get it done, and not just poverty, pimping for black and brown communities?
Thank you for thank you for your questions. And those are very important issues. And I think ones that we recognize our issues. So I’ll start there. That’s not this is not something that we couldn’t say, Wait, what are you? What are you referring to? to your first question? Well, let me take your second question first. So we do realize that we need to make sure that we are equitable in our in our grant making. To that end, we’ve set some internal goals around our portfolios, so that we are prioritizing that the majority of our grant giving will be given to diverse led organizations. Now, you mentioned leadership board, etc. And so what we’ve we’ve had many conversations over the last year about how do we measure diverse lead? Is it a black Executive Director, with an all white board and an all white program staff? Would you count that as diverse? I see nods, but I think it would probably mean shaking your head. And so we’ve come up with a definition around senior leadership, around composition of the board around program staff. So that’s one thing. In driving at that commitment, we’ve also recognized that these aren’t easy issues to talk about, and that some organizations may need or want some tools to have those conversations. So as part of getting to that goal, we’re starting to look at how do we use our funding, to prioritize to give organizations the ability to do that work that they’re identifying themselves? And then the third thing I would I would say on that is, we want to make sure that when organizations do express, that’s our that we want to make sure that our folks are equipped to have those conversations, because those aren’t easy conversations as well. And No, by no means would we ever want to put ourselves in a position to dictate to an organization that says you need to do this. Well, we want to say is, what challenges are you having in this arena? What have you seen, what have you experienced? Are there resources that that we can help you connect with? To do that? So to answer your question, pointedly, it is a priority for us. And we’re on a journey to get there, too, to the first point. And if I The question was long, so I don’t remember it all, forgive me. But how I think one thing that we asked, the folks that I asked the folks on my team is to build those local relationships. We’re also we also know that everyone can’t meet with everyone. And so while I recognize that is the case, we also want to make sure that we’re not being neglectful. And so that, and that’s just that’s just something for us to pay attention to is where are these relations chips being built? And I think, as we look at this diversity goal, we will probably experience some change in portfolios. And that’s intentional.
AUDIENCE MEMBER 1:04:18
I would just add, you know, it’s in through this process, we did also take a really close look at this question of who we’re getting to. We have had a long standing program. And we have someone who’s stepping up to the mic who can attest to it, of community progress makers, who are local organizations that we give to unrestricted funding to develop solutions in their communities over a number of years. But beyond that, through action of racial equity, as we were looking at, you know, I talked about law firm partnerships and other you know, folks within the institution that we were evaluating, we also didn’t think very hard about our philanthropy, the leadership of the organizations tracking very rigorously and as in other areas, whether it’s diverse asset managers or elsewhere, diverse financial institutions like broker dealers, how do you determine what do you what what is that? What does that mean? What component the leadership? How do you measure it? And obviously, how do you measure progress? So I think it’s something we’re still evaluating based on the initial, you know, survey of our current portfolio and how it might need to be tweaked. But it is not easy. And there’s no, like simple solutions. Like you’re just pick a black, black Executive Director, and you’ve taken care of the problem.
Thank you for the question. I want to be mindful of time. So we do have time for one more question. So those who are standing, I do apologize. Feel free to feel free to connect with me, and we’ll make sure your answer. Yes, ma’am. Yes, ma’am. How about how about we entertain this last question. And we’ll circle back with you once once we dismissed just please come up and come up ask more questions, we’ll be here.
AUDIENCE MEMBER 1:06:06
So the last speaker triggered a question that I wasn’t planning to ask, but since you started it, I’m gonna finish it. So yes, my name is Nikki Beasley, Executive Director of Richmond neighborhood housing services in the Bay Area. And yes, we’ve been funded by both funds city and chase. Question is the sustainability plan. I can say being a black woman leading an organization, I’ve got more opportunity than I’ve ever had, in the six years that I’ve been leading this organization. And without the death of George Floyd, I don’t know if I would be in this position today. So my question is what is going to be the sustainability plan to keep these organizations that so much funds have been infused, which is programming, which is grant-based, and when the tide shift, to continue to assist these organizations? But my second question is from an affordable housing lens. And we focus on neighborhood development, a lot of conversation, spin on homeownership support, and we’re a HUD counseling agency. So we do a good job in getting people qualified. So my offer and innovation would be not just pouring money into downpayment assistance and innovative community lending programs, but making funds available to make sure that inventory is affordable for first time homebuyers. Because what tends to happen is the investments are and I’ve heard it a couple of times scalable, but in neighborhood developments where you have smaller lots, opportunities that don’t tend to be as attractive to the traditional developer could be a great opportunity to secure housing that’s affordable for first time homebuyers, especially in high cost areas. So I would offer that as a suggestion.
Thank you. Do I take the first question? Okay. So to thank you, thank you for that question. And and for the suggestion. As to the sustainability plan. I think from a I can speak from a philanthropic perspective, I don’t know that we have plans to decrease our our kind of philanthropic levels of spending, and grant making. So I think the other thing I would say, as we look at how we want our portfolios to look and who we want to engage, we’re not going to be stepping away from communities in which we’re engaged. Now. I think what we want to do is make sure that our partnerships are going deeper. I think what we want to make sure that we’re doing is that through both our JPMorgan Chase Foundation, our public engagement organization, which is also focused on building relationships with grassroots organizations, that we are ensuring that our support is permeating down through all levels of the community ecosystem and the nonprofit ecosystem and community. So I don’t know that I have a five point sustainability plan, but I do know we have a commitment to the communities in which we’re working. And I think one example I gave earlier in in this session was just our work here in this region. You know, we started out three years ago, there was no you couldn’t see a chase bank branch anywhere in Washington, DC. There was just an office on Connecticut Avenue. And you had to be a private bank client to to have access to it. Now we have Chase branches. We’ve made multi year multimillion dollar commitments to some of the most under resourced neighborhoods, and we’ve continued to to meet those commitments and make new ones. So I think that’s an example of how we plan to continue to support work in organizations and communities.
I would just add that, you know, as I’ve noted earlier, this isn’t really new work for Citi. We did ramp it up, we did bundle it into this initiative that we thought it was necessary to demonstrate the level of seriousness with which we were responding to that, that, that moment of crisis. But everything that we’re doing is really just a continuation of things that we’ve been doing for a long time. And so I don’t, I’m not worried about the sustainability, or major retraction, whether from a business perspective or a philanthropic perspective, it’s really just kind of continually learning about how to do it better. Obviously, community progress makers didn’t exist at a certain point. But now we’ve been through it a couple of times. So we’ve learned and it’s pivoted in different ways. And so it’s I don’t, I don’t have concerns about that. But I definitely understand that it would be very legitimate, you know, fear, that eventually the topic kind of fades away into the background again, obviously, we can’t let that happen.
Thank you. Thank you so much for your time and your questions. I know that the events team is going to kill me if I don’t. And I know that we will welcome welcome your question. After we close out I think, as part of our– Why don’t you just ask us a one?
AUDIENCE MEMBER 1:11:02
Just one question—
How about a compromise? Please ask your question, so everyone can hear it. But then let’s discuss it.
AUDIENCE MEMBER 1:11:10
I’m Carolyn Kennedy, I’m the Executive Director of Brotherhood and Sisterhood International, Africa Diaspora Directory, we deal with people nationwide and internationally. You mentioned, Mr. Daniel, that one of the problems that you constantly identified is the Under appraisal of properties owned by people of color. And so I mean, I’m also a personal real estate investor. I have several properties with Chase. And I want to know, when you identify properties that have been undervalued, which is one of the worst generating methods that people of all colors use. What did what does the bank do to deal with that problem?
I’m going to answer that as best I can as a non banker. So what I mentioned earlier, what we when we identified this issue, we supported a policy solution. So last year, Governor Hogan in Maryland signed into into law, a bill that would address spending to make up that appraisal gap. So I don’t know that I don’t know. And I can’t answer this directly that we have a one off identification house by house. But when we look at a systemic problem that we can address through a policy solution, we’ll try and support that.
Miss Carolyn, oh, we have an organizing team that does really great work locally around appraisals would love to connect you with the team who’s doing some interesting work there. For sure. Thank you all for attending. I appreciate the thoughts.