New Report Gives Banks a Clear Pathway to Diversity Benchmarks

New benchmarks for racial and ethnic representation from NCRC and Beneficial State Foundation set goals and metrics for banks to evaluate their performance

Banks are past due to make good on their racial and gender equity and inclusion commitments.  

A new  report, from the National Community Reinvestment Coalition (NCRC) and Beneficial State Foundation, introduced a Racial and Ethnic Representation and Investment (RERI) framework for banks to set goals, measure progress and evaluate performance of managers and executives. It emphasizes accountability through transparent reporting and goal-setting that banks must do on behalf of their public depositors. The report was commissioned by Beneficial State Foundation, a nonprofit and owner of a community development bank, whose mission is to change the banking system for good. NCRC and Beneficial State Foundation have a shared goal to restore fairness and equity to the US banking system. 

“Banks can and must do better at hiring, promoting and retaining African Americans and Latinos at the mid and executive level positions,” said Dedrick Asante-Muhammad, NCRC’s Chief of Race, Wealth and Community. “As well-resourced and well-established institutions, banks have no excuse for having such low levels of representation of African Americans and Latinos in leadership. As the NAACP Opportunity and Diversity Scorecard Report Card on the Consumer Banking Industry points out, the banking industry has failed to increase its representation of Blacks and Latinos in higher management positions despite increases in higher education attainment. Banks need to hold themselves accountable to strengthen Black and Latino representation, and our report gives them metrics and best practices to help them with their efforts.”

NCRC’s RERI framework includes a four-tiered grading system for banks to analyze their internal diversity progress. The framework also includes a review of hiring, recruitment, retention, sponsorship programs and other best practices to improve racial and ethnic representation across all job levels, while also strengthening the bank’s commitment to diversity, equity and inclusion.

“This research and the RERI framework are extremely helpful to Beneficial State Foundation to help us inform our Equitable Bank Standards in development, as well as to our partner bank, Beneficial State Bank, to think  about its pathway toward our shared vision of a racially- and gender-just society,” said Erin Kilmer Neel, Beneficial State Foundation’s Executive Director and Chief Impact Officer.    

The report, which analyzed 2018 data from the Equal Employment Opportunity Commission (EEOC) on racial and ethnic diversity across different job levels, found that at the executive/senior level, compared to the overall population:

  • 3% were Black (13.4% overall)
  • 4% were Latino (18.3% overall)
  • 6% were Asian (6% overall)
  • 30% were women (50.8% overall)  

The release of the analysis and RERI benchmarks also closely followed a Reuters report about remarks in a company-wide memo from Wells Fargo & Co <WFC.N> Chief Executive Charles Scharf about the alleged difficulty of recruiting Black employees.

View the full report and RERI:
https://ncrc.org/reri/

For more about how to use RERI in your bank, contact:

Sabrina Terry
sterry@ncrc.org
202-464-2717

Media Contacts

Alyssa Wiltse
NCRC
awiltse@ncrc.org
202-393-8309

Wil Kristin
Beneficial State Foundation
wkristin@beneficialstate.org

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

Complete the form to download the full report: