Diversity and inclusion strong in banking, but work needed

Private banking and wealth management has often struggled with a reputation that can see it as more traditional than progressive. However, in terms of diversity and inclusion, the sector could be doing a lot worse. It could also be doing better. Patrick Brusnahan writes

Refinitiv, formerly Thomson Reuters Risk, has ranked the top 100 most diverse and inclusive organisations globally.

Utilising the Diversity & Inclusion (D&I) Index, the number one company was BlackRock with a score of 81.

The top 25 firms also featured a number of other financial companies, such as Royal Bank of Canada (fourth place with a score of 79), Bank of Nova Scotia (10^th place and a score of 77.25), and Societe Generale in 19^th with a score of 75.25. There was another Canadian bank in 14^th place, TD Bank, with a score of 76.

Overall, banking, investment services and insurance firms had a total of 18 names in the top 100, the highest of any sector. It was followed by pharmaceuticals with nine.

Debra Walton, chief revenue officer at Refinitiv, said: “The global pandemic has certainly brought to light a renewed focus on diversity and inclusion, reinforcing the reality that we are all in this together. Data-based insights and transparency are a fundamental element of a successful movement to achieve more diverse and inclusive workplaces.”

Sang Lee, managing partner at Aite Group, commented: “The continued industry interest in the D&I index reflects the increased investor appetite to invest in environmental, social, and governance related areas and the changes that are happening across all sectors of the capital markets. Some of the largest asset managers in the world have this year become much more active in engaging in shareholder voting on the issue of improving diversity and even the world’s oldest private banks have taken to the industry stage to discuss their investment strategies around ESG.”

William Trout, head of wealth management at Celent, added: “ESG today has reached a tipping point, and issues related to employee welfare, gender equality, supplier diversity and other social concerns today vie with governance and environmental considerations for attention. Firms must prioritise diversity and inclusion or face tangible pressure from activists and consumers as well as investors, particularly as stakeholder capitalism challenges the primacy of the shareholder in corporate decision-making.”

Top 10 Index ranking and D&I score

Source: Refinitiv

Further steps

While positive moves forward are being made, more can be done.

According to Refinitiv, the cultural diversity of board members in the top 100 has increased from five years ago, but has stalled at close to 30%.

At a country level, only Germany maintained a positive increase in the percentage of culturally diverse board members.

However, the number of companies with an official flexible working policy has increased by 54% in the last five years. Also, 25% more companies have a career development policy in place compared to five years ago.

Elena Philipova, global head of ESG at Refinitiv, said: “Our Diversity and Inclusion Index, now in its fifth year, emphasises the critical importance for companies to commit to, measure and report on their diversity journey beyond gender.

Sustainable and resilient workforce is the fuel for businesses especially during volatile times. Refinitiv remains fully committed to using our data assets, expertise and influence to champion the importance of diversity and inclusion in the workplace – including our own.”

Financial firms in the top 100

Source: Refinitiv