Diversity and Inclusion are so important to the banking industry and financial institutions. There is a growing body of research that points to consumers are taking their business to companies with a proven commitment to D&I and how inequity can erode a culture. For example, through the great migration from the south, Blacks moved from the south and longed for the American dream that the north promised others. That promise would bring better opportunities—housing, employment, education, and overall lifestyle changes. In many cases, the opportunities require connections with a banking or financial institution.
For many years, access to capital was denied to Blacks by most banking and financial institutions. The lack of minority talent representation within the banking industry continued for decades at all levels well into the 1970’s. Partnerships between black banking institutions and white banking institutions began to emerge but often on the terms of the white banking institutions which were not sustainable overtime. Those white banking institutions that truly invested in their communities regardless of diversity, experienced greater Return on Investment (ROI), and Return on Equity (ROE).
Why Value Diversity From a Business Perspective?
There are six business reasons why all industries should value diversity and inclusion:
- The smart/right thing to do
- Changing demographics
- US and non-US business case—data driven perspectives
- The law of the land
- The buying power of all demographics i.e., women, multicultural communities, veterans, individuals with disabilities, and more
- Safe and productive environment—creating culture and a sense of belonging
To have healthy, vibrant organizations that thrive for the long term and performs in the short term, leaders must constantly evaluate and evolve both what they do and how they do it. That includes a focus on diversity and inclusion. Organizations are encouraged to ensure their bottom-line results showcase and reflect the comprehensiveness and integration of diversity in their overall strategy (internally and externally).
Many, including multicultural groups, women, and the younger generation generally value the presence of diversity in a workforce. In their eyes, diversity increases employee satisfaction and reduces conflict, improving collaboration and loyalty. Organizations that effectively capitalize on the strengths of all employees and leverage their difference and unique values have the most engaged employees, productivity, profitability, and innovation.
The Impact of Changing Demographics
The changing demographics reflect a drastic shift in population beginning in 2020 to 2050. This population shift should result in a change in the representation or available pool of talent in organizations. Due to projected growth among Asian, Hispanic, and multiracial groups, traditionally underrepresented populations will hit majority status by 2044, according to the Census Bureau. As the country becomes increasingly diverse, the United States will no longer have a single ethnic or racial majority by 2065 (Pew).
Rapid and massive demographic shifts are a reality across the globe. The global workforce is becoming increasingly female, and nonwhite, while stretching both ends of the age continuum. The increase of global, multicultural, and virtual teams is fueling strategies that foster inclusion, collaboration, and innovation. The power of diversity can only be unleashed, and its benefits reaped when we recognize each other's differences and learn to respect and value each individual regardless of background. Which points to the increasing buying power of many demographic groups. “Workplace Diversity” and “Inclusion Gets Innovative” (2017) indicates that organizations with more racial and gender diversity bring in more sales revenue, more customers, and higher profits.
Fast forward to the Financial Services Sector and Dodd Frank Act between 2007 to 2011, the financial services sector was not very diverse. From the extensive report issued during this time, there had been no substantial changes in the number of minorities and women in management in the financial services industry and implementation of key diversity practices and policies. This report set out to create priorities for industry leaders to create more equitable opportunities so that meaningful change could occur. With meaningful and sustained improvements in D&I within financial institutions, these efforts can help improve the safety and soundness of the industry and restore trust that was lost by many diverse communities.
Continuing the Diversity and Inclusion Journey in the Workplace
The topic of diversity and inclusion is not new. Many individuals and organizations had a wake-up call in 2020 which led to reexamining approaches to workplace initiatives and culture. There is now a sense of urgency in many organizations to launch or fully capitalize on diversity and inclusion efforts to drive their value equation. The banking and financial industry will continue to be on a journey to fully leverage diversity and inclusion for quite some time. If you start, if you do something, you are a part of the solution to making workplaces and communities you serve—equitable, fair, and just.
Dr. Andrea Hendricks
DEI Thought Leader
About Dr. Andrea Hendricks
As the Senior Executive Director & Chief Diversity, Equity & Inclusion Officer, Dr. Andrea Hendricks leads Cerner’s global diversity efforts in over 26 countries and the US. In addition, she is a member of the Human Resources Leadership Team Since 2018, she is making an impact on Cerner’s culture by driving strategy and engagement initiatives that foster organizational learning and enhanced corporate diversity and inclusion vision for Cerner associates, leadership and community collaborative partners.
She works enterprise-wide to seamlessly embed comprehensive diversity engagement strategies and best practices. Hendricks past roles included being the Assistant Vice President & Deputy Director of Diversity and Inclusion at the Federal Reserve Bank and SVP, Diversity and Inclusion at UMB Financial Corporation.
Hendricks graduated from Kansas State University with a Bachelor of Science in Human Development Psychology and Mass Communications and a Master of Science in Student Counseling Psychology and Personnel Services. She earned a Doctorate in Educational Psychology and Policy Analysis from the University of Missouri -Columbia. She has a Certificate in Diversity Leadership from SHRM and Yale University.
She is an author of a diversity book titled: The BIG Journey: Bold Inclusion for Greatness. Hendricks currently serves on the National World War I Museum, YMCA, United Way’s board to name a few. She is a member of the National Women Business Collaborative, Greater Kansas City Executive Women’s Leadership Council, Alpha Kappa Alpha Sorority, Black Achievers and the Greater Kansas City (MO) Links, Inc.
Dr. Hendricks has received numerous noteworthy recognitions over the years. In 2021, Hendricks received the 10 Most Empowering Women in Business Award by Insights Magazine, Inducted into the Women Who Mean Business in Kansas City and the Top 50 National Multi Cultural Leaders recognition by Diversity Leadership, Inc. In 2020, she received the Greater Kansas City Chamber of Commerce ACE Diversity Award, 2019 Black Health Care Equity Award, Black Achiever’s Society Lifetime Achievement Award and the NAACP of Kansas City community leader award.
In 2012, the Women’s Foundation honored her for her commitment to women’s issues and in 2011 she received a Peak Performance award for her continued commitment to leadership excellence and stellar work in the area of corporate diversity and inclusion from the National Eagle Leadership Institute to name a few.
You can learn more about Dr. Hendricks and her work at her website: https://www.drandreahendricks.com
Andrea D. Hendricks, Ed.D., CDE
Senior Executive Director & Chief Diversity, Equity & Inclusion Officer
Global DEI, Community, Philanthropy