Lack of diversity in Banking/Finance
Let me start off by making a couple of points:
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Everything I will say is strictly my opinion or experiences that I have had
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My experiences have led me to have a certain mindset and I am simply posting to see if anyone else feels this way or has any comments
To keep it simple, I think there is a major diversity issue in Banking. From my personal experiences, I have seen over 40 banks where the team is literally nothing but white people. I have been to super-days where 100% of the employees in a bank are White. The one rare non-white person you will see will be working as a receptionist. I recently went to a super-day where there were 53 people there in total. 3 of them were minorities, 50 of them white. Now I understand that there is a way larger population of white people in general to minorities but I personally do not think this is all by coincidence. I am also not saying that these people are being racist against minorities but someone please help me understand why this is. I understand Finance is a white dominated industry, but I honestly do not think that minorities are given a fair chance in Banking.
This has gotten to the point where I feel inferior in an interview when there is a white male also interviewing. I don't expect anyone that is white to understand how I feel because it is very difficult to explain when you are the minority. Is there anyone that also feels this or am I the only person?
This issue extends far beyond banking/finance. Think about how competitive the IB process is, for example. Most of the kids that make it have basically been groomed for it. Went to a great private school and got straight A's, made it to a target school and started networking and leveraging their resources from day 1 in order to get in front of the right people.
Now consider this - 39% of African-American children/adolescents and 33% of Latinos in the US are living at the poverty level. I'm a minority that was blessed enough to grow up with a supportive family, amazing resources, and the right mindset to break into IB; however, many are not as fortunate. I have a friend who grew up in the inner city. His school system was drug/gang ridden and provided close to 0 opportunity to succeed. He had never heard of the SAT/ACT until the end of his junior year. His dad wasn't around, his mom was on drugs and he took care of his little sister. He could list at least 10x the amount of people he knew that had been shot or had gone to jail than had gone to college. He was lucky enough to be one of the most gifted athletes in the country and had people take him under his wing to make sure that he could make it to the next level.
My point is this - Many minorities grow up without the resources or platform needed to make it into high finance. That, in combination with the fact that there are far less blacks/Hispanics than there are whites in the US, lead to horrible placement numbers for minorities. All of these diversity organizations and accelerated processes are amazing, but from my experience I've seen that the majority of those kids already had the resources they needed to break in (grew up wealthy, strong family support, went to a target school, etc). *Obviously generalizing here
To fix the diversity numbers in high finance, we first have to fix the systemic issues that have led to minorities making up the vast majority of the lowest socioeconomic class.
Disclaimer - I do know/believe that anyone is capable of breaking in no matter where they start from. I'm just saying the probability of making it as a minority coming from below the poverty line is very low.
Also - You should never feel "inferior" interviewing with a white male. If you got that interview then you are just as qualified as he is. Take confidence in yourself and the work you put in to get where you are today
The inferior-ness is also part of it too. It's difficult to be the one women/minority in your starting class. Even if you are super qualified, some people will just look at you as the diversity hire.
Agreed and to add on to that you probably see a lower percentage of Asian / Indians because parents oftentimes push their children towards studying things like Medicine / Law / Engineering. Partly because they are unaware of IB and partly because that's just "how it's been" forever.
Spot on analysis.
This feeling is more common than you think. People tend to hire and want to work with people that are similar to them. Most people in power in the corporate world are white, usually male, and usually from a middle class or upper-middle class background. People also tend to take shortcuts when hiring people. They want to hire people that they think will be "successful" at the firm, and often times the default imprinted in people's minds for how someone "successful" should look is a 6-foot white man in a tailored suit with cuff links and a side part.
Idk what you are talking about...if you look at the recruiting brochures for all of the banks they appear to be at least 50% minorities or diversity employees in the pictures...am I missing something?
They post diversity pictures on brochures for a reason. And its only these BB banks that tend to have diversity programs. Look around at other MM or lower MM banks and let me know if you see any diversity
I think he was joking...
It's very common. Some banks are more open to hiring and diversifying their workforce from what I've seen (think: GS, BAML, Citi) but it is still a huge problem. I think in large part it's due to what RelocationBB said, minorities just aren't groomed for these opportunities. It's even more discouraging when you look at PE team pages and everyone at the top level is a white male. These things discourage minorities from pursuing careers in high finance. I think we have a long way to go before things change.
Frankly, the publicly traded firms are more worried about acting like they care about diversity.
I am a minority and not only a regular minority, but an extreme one that is most likely on this forum to run into issues and I've had 0 racial issues dealing with ibankers/doing deals. In general, smart people like the ones you find in banking are not racist.
...and yeah it's not a hiring-issue, it's a societal issue. Keep in mind people were injecting black people with syphillis for shits and giggles until very recently: https://en.wikipedia.org/wiki/Tuskegee_syphilis_experiment
FWIW, I ran into way more overt racism in high school from my teachers and when I was trying to get regular blue collar jobs.
Nice to hear. And yeah I wouldn't say its racism, I was just curious why there is such a diversity issue in banking.
I second this as a fellow minority. Been to many interviews and superdays and not once did the thought of “oh no one here looks like me” cross my mind. I think that feeling uncomfortable with a certain group of people is more about what type of person you are (ie fratty/bro-ey vs more introverted)
And yes we are still underrepresented in high finance but from my understanding the placement of minorities in IB right now is exponentially higher than it was even just a decade ago. So there’s work to do but at least we are making progress.
Don’t say that too loud , these people got to keep believing the big banks are against minorities it fits there view points
As a minority myself I feel like I've had nothing but advantages to be honest. Reason for under-representation of minorities is socioeconomic as others have said.
But what I find so peculiar is that it's not the socioeconomically-disadvantaged minorities who do the complaining. It's always the minorities who actually do have the opportunities who are also taking out lots of time to complain about diversity issues. Oftentimes, these are people with not just opportunities, but actual preferential treatment . . advantages when applying to schools and jobs just for being able to check a special box.
I suppose, in some cases, these people who complain about diversity are just trying to look out for the less fortunate. But it's not a thoughtful way to go about it. The % of well-educated kids who are prepared for a banking role is overwhelmingly white, and I don't think it's the employer's job to fix that. You can blame schools, blame students, blame parents, blame professors . . but when the employer gets a stack of resumes that's 90% white with the most polished kids being 95% white, it's not useful at all to ask what the employer should do about it.
This, and also, there are people who don't even prepare for banking roles, but have the contacts to get them in. I went to small private college, and there are people who graduated with me doing finance jobs, yet have American Studies degrees.
Minorities actually are not given a fair chance. There was a study done years ago where recruiters were given the same resume, but with different names (white name vs black name), and the white named resumes scored higher with the recruiters.
As stated, it's not just in banking. It's a generational issue though. I know it happened to myself. When I graduated college, I didn't really know the different avenues in banking. Actually most people don't. I think that's where a lot of minorities start, and they don't really understand where to go.
Another big part is how to act/dress/talk. They have to be learned. To an extent, a lot of it is inside baseball. One overarching thing also, is people like to be with people they resonate with. Banking is not a zero sum game to get the smartest person, or person who works the hardest; coworkers also have to connect. A white MD might take a slightly less smart associate who is also white (or black or asian) because they can talk about sports vs a someone else who knows very little about sports. I think this goes the other way too, to an extent. Meaning, I think some minorities who grew up poor see the problems in the community and may become a social worker/teacher vs trying to make the most money possible.
On your interviewing issue, what can breed confidence is being prepared. Think about a topic you know really well, vs one you don't. How easy can you talk about the one you know, vs the one you don't. Feel that confidence during an interview.
Great analysis, and thanks for the study you mentioned. Non-minorities have a hard time understanding that this is an actual issue.
There will always be differences on the margins that cause someone with slightly less merit to get the job over someone with slightly more merit.
When it comes to race/gender status, I think this is actually a net benefit to minorities, not a net harm.
On the one hand, there's the downside that you point out: white guys more often come from backgrounds that give them this edge on the margins that you speak of . . how to act etc.
But on the other hand is a clear-cut advantage given to minority candidates, especially women, that is often far more pronounced. In both of the banks I've worked at (one EB and one well-known MM shop), there is aggressive favoritism from HR for these diverse candidates. I've seen superday slots reserved for minority candidates, special events and other outreach programs, and even once got a call from HR saying I would need to provide them with extra details on why I rejected a minority candidate "because a management initiative requires a good reason when we reject a minority".
And women? Take everything I just said above and multiply it by 10. Sometimes I wonder if they even let female candidates leave the building without accepting a job first.
Net net, I think there are clear-cut advantages for minority candidates.
Of course, you need to be the right kind of minority. Asian males need to rely on their brains. Interesting society we live in.
I agree. I think its all how you look at it.
But I also think its a depth problem. I think a "white" person who is average has a better chance to break in than other races.
Diversity hires are usually given to people who don't need them exactly anyway, like a minority/woman who would have been hired anyway. I remember in high school one of my fellow students had parents from Nigeria. The mother went to Harvard and the father went to Columbia (I think). In basically a non-bragging way, he told me he was going to ether once of those, and this was freshman year. But I feel this is the type of person that gets hired as "diversity", when it's not really diverse when you hire from the same 7 schools.
I would say this diversity issue depends on the bank/group you look at. I think the “all-white” stereotype isn’t as true as it has been in the past.
For example, my BB group has multiple black guys, a Hispanic, multiple Asians, multiple Middle Easterners (and has historically been a similar make-up). All in all, out of a group of roughly 30-40, only about half of that number is comprised of whites.
Another (much larger) group at our bank is filled with internationals, with something like 20 or 25 countries represented in a group of 60-70. So, like I said, I guess it depends on the bank/group.
I agree. Each year we get more and more diverse on these things.
However, diversity can be both skin color and social status. Yes, banks may hire more people of minorities, but most of the leadership if made up of white males. It's kinda like the President, mostly all white (save Obama), but I think Obama had a "vibe" that white people liked- educated, well spoken, had a family. In the end, I think it's more fitting the mold than people think (Michael Lewis talked about this in Moneyball).
Social status, as stated further up the topic, it's easier to get into banking if you know how banking works. In a way this is bad, because it in some ways creates a monarch for this positions. However, it's also like sports. The NFL won't get better if they had reserved roster spots/starting spots for slower/smaller/weaker people; they need the best of the best. Same thing in banking. However, everyone thinks they can do banking because you can't see a person's limitations by looking at them.
In the end, it's not just hiring more blacks/asians/latinos/women, its about them having the same opportunity to succeed.
The idea expressed above, that the real issue is way more profound and ingrained in the socioeconomic structure, is one that I completely agree with.
As a minority, I fell like initiatives such as affirmative action and diversity hiring have good intentions behind them and are one of the few ways schools/employers can attempt to even the playing field but are often too little too late ( Ex. the argument that affirmative action is wrong because it funnels in underprepared minorities students putting them in a situation they aren't always ready for).
The real issue comes way before we are applying for colleges and jobs. It is rooted in one's childhood and the lack of preparation and exposure minorities experience at an early age. Until we can figure out a way to provide the appropriate resources to minorities in their youth I believe this issue will continue to be prevalent not only in banking but the majority of lucrative industries.
I always found affirmative action insulting tbh. I get why it's there though.
Sales Desks / Banks with the best diversity? (Originally Posted: 02/02/2010)
Within Sales / the major banks --- which ones would you say have the most diversity?
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