New Report: Black, Latino Workers Face Tough Odds of Getting Higher Paid Positions at Leading U.S. Banks

A new CWA report captures the scale and depth of the diversity, equity and inclusion crisis in the U.S. banking industry. The findings indicate that while Black and Latino employees are concentrated at lower levels of employment, they have a substantially lesser chance of holding executive or other higher levels of employment compared to their white counterparts.

The findings — gathered by the Committee for Better Banks (CBB), a coalition of frontline bank workers fighting to improve working conditions at the nation’s largest financial institutions — evaluated 13 of the largest US banks on their employment data disclosure, workforce diversity and internal advancement or promotion opportunities for Black, Latino, and Asian employees compared to white counterparts. Part of the group’s efforts to track and measure the banking industry’s response to the Covid-19 pandemic, a project called the Better Banks Accountability Project, CBB’s data comes as bank executives wrestle with racial bias and discrimination within their own ranks.

CBB’s analysis quantified the odds of advancement for Black and Latino employees to a Senior Management or Executive position at banks where data was available. Key numbers are as follows:

• 8%: the chance of a Black employee’s advancement to a senior management or executive position, compared to their white colleagues at Capital One.

• 10%: the chance of a Black employee’s advancement to a senior management or executive position, compared to their white colleagues at TD Bank.

• 15%: the chance of a Latino employee’s advancement to a senior management or executive position, compared to their white colleagues at JP Morgan.

• 23%: the chance of a Black employee’s advancement to a senior management or executive position, compared to their white colleagues at Bank of America.

• 23%: the chance of a Latino employee’s advancement to a senior management or executive position, compared to their white colleagues at CitiBank.

• 230%: the chance of a Black employee being in an entry-level position, compared to their white colleagues at Citibank.

• 404%: the chance of a Latino employee being in an entry-level position, compared to their white colleagues at TD Bank.

• 427%: the chance of a Latino employee being in an entry-level position, compared to their white colleagues at JP Morgan.

• 505%: the chance of a Latino employee being in an entry-level position, compared to their white colleagues at Bank of America.

• 650%: the chance of a Black employee being in an entry-level position, compared to their white colleagues at Capital One.

More key findings can be found below and in the report [LINK].

Overall, the banking industry is failing on transparency and disclosure of employment data. None of the 13 banks evaluated included information about pay equity for each job classification. Only five banks disclosed workforce diversity statistics that included the total number or percent of individuals in each job classification and race group. The remaining eight provided either insufficient data or, in the case of Bank of the West (BNP Paribas) and Santander, refused to disclose any employment demographic data. 

“We’re releasing these numbers to show leaders like Charlie Scharf there is diverse talent in the banking industry, but non-white frontline workers, especially if they are Black and Latino, are systematically shut out of promotion opportunities,” said Nick Weiner, organizing co-director of the Committee for Better Banks. “Bank CEOs are missing a critical opportunity to strengthen their organizations: promoting diverse employees helps to retain key institutional knowledge and reflect the communities where the banks operate.”

“It’s unacceptable that it is the standard, not the exception, for banks to deny stakeholders, including their own employees and their shareholders, demographic data on their workforce,” Weiner added. “If banking executives are serious about their role in building a more equitable society, they must be transparent about the disparities in advancement and promotion in their own workforce. Without robust and verifiable disclosure, commitments to diversity, equity and inclusion are nothing more than a public relations exercise.” 

Among all five banks that provided sufficient data to properly measure and grade representation and advancement, CBB found decreasing diversity at progressively higher employment levels. None of the five banks are reporting Black employee representation, at any employment level, above the industry average. At the same time, Black and Latino employees are far more likely to hold entry-level positions compared to their white counterparts, while their odds of holding higher level positions compared to their white counterparts is as low as 8% and 12%, respectively.

“In eight years, I’ve interviewed for a higher position at US Bank about 15 times and been promoted only once. I was meeting my goals and working hard, but I couldn’t help but notice that people with a connection to the hiring manager continued to be promoted over me,” said Marcus Dodson, an Account Coordinator in US Bank’s Corporate Credit Card department. “This isn’t complicated: diversifying the workforce at US Bank requires an intentional effort to identify Black talent and promote us.”

Amid the civil rights protests that erupted across the US, frontline workers with CBB formed an anti-racism committee to fight for racial and economic justice within the banking industry. The committee, which comprises of workers across the largest US banks including at Wells Fargo, US Bank and Bank of the West, meets monthly to discuss the history of systemic racism in the banking industry, personal experiences dealing with racism while on the job, and how they can help create a more diverse and equitable financial system for their customers. CBB’s report on banks’ diversity and inclusion progress is the organization’s latest effort to hold the financial industry accountable to its employees and customers of color. 

Key findings from CBB’s analysis:

Disclosure:

• 5 banks disclosed workforce diversity statistics in EEO-1 or comparable format that includes the total number of individuals in each job classification and race: Bank of America, Capital One, Citi Bank, TD Bank, JP Morgan.

• 3 banks disclosed data that did not allow for the calculation of the total number of diverse employees across the firm: PNC Bank, Wells Fargo, US Bank.

• 3 banks disclosed substandard workforce diversity statistics, preventing the calculation of employee advancement at these banks: Fifth-Third Bank, Truist Bank, HSBC North America.

• 2 banks failed to disclose any employment demographic data: Bank of the West (BNP Paribas) and Santander.

• 0 banks disclosed workforce diversity statistics that included information about pay equity for each job classification.

 Representation:

• At 7 banks, representation of Black employees in entry-level positions was significantly stronger than industry averages; although, since averages for Blacks and Latinos in semi-skilled and low-wage positions are already representative of the population, increasing representation and diversity in low-wage positions is not a priority, especially if there is little room for upward mobility from a low-wage/semi-skilled position. Meaningful diversity efforts should be concentrated at upper levels: Bank of America, Capital One, Citibank, TD Bank, JP Morgan, PNC Bank, US Bank

• At 4 banks, representation of Black employees at Executive/Senior Management levels fell below industry averages and the demographic proportion of the population: Wells Fargo, Capital One, TD Bank, US Bank.

• At 5 banks, representation of Latino employees at Executive/Senior Management levels fell below industry averages and the demographic proportion of the population: Capital One, TD Bank, PNC Bank, US Bank, Wells Fargo

• Overall, 4 banks averaged below industry averages and the demographic proportion of the population: Wells Fargo, Capital One, Citibank, and US Bank. 

Advancement:

• At Bank of America, Black employees have a 23% chance of being in Senior Management or an Executive position compared to their white colleagues.

• At TD Bank, Black employees are 326 percent more likely and Latino employees are 404 percent more likely than white employees to be in entry-level positions, while they only have approximately one-tenth the chance to be at the Senior or Executive level as their white colleagues.

• At Citibank, Black employees have a 27% chance and Latino employees have a 23% chance of being in Senior Management or Executive positions compared to white colleagues. Meanwhile, Black employees are 2.3 times more likely than white colleagues to hold entry level positions.

• At JP Morgan, Latino employees have a 15% chance at being in Senior Management or Executive positions compared to white colleagues, but are 427 percent more likely than their white peers to be in entry-level positions.

• At Capital One, Black employees only have an 8% chance of being in Senior Management or Executive positions compared to their white peers, but are 6.5 times more likely to hold entry level positions compared to white colleagues.

“Stakeholders, from workers to investors to policymakers to banks’ own customers, will be unable to fully hold banks accountable to the commitments they’ve laid out for racial equity, as long as employment data disclosure remains voluntary,” said Hudson Munoz, research analyst for the Committee for Better Banks. “Bank regulators must use their power to require disclosure of detailed employment information. That would be a powerful step toward progress — the nation’s most powerful banks should not be allowed to hide under a veil of secrecy.”

In order to fully address the banking industry’s potential bias against Black, Latino and Asian workers, as can be inferred from the grossly disfavorable disparity found in this report, CBB recommends more robust policy adoption and enforcement related to banks’ data disclosure and transparency. Specifically, CBB is calling on policymakers and bank regulators to require banks to publicly disclose detailed demographic employment information, including EEO-1 employment data, and make compliance with the standards for determining diversity assessments mandatory for banks. 

CBB’s report provides additional policy recommendations, including for banks to implement an enhanced Rooney Rule and disclose progress on implementation; widen the talent pipeline and training opportunities for diverse employees; and align executive pay and bonuses to achieving diversity and inclusion benchmarks, with the diversity goals and data publicly disclosed in order to show whether the goals were indeed met or not.

“It’s extremely deflating to be a person of color at Wells Fargo. In the past couple years, I’ve watched a handful of Black managers at Wells Fargo get fired or leave. I myself have applied for 15 promotions at Wells Fargo and not received a single phone interview, despite doing everything right,” said Ted Laurel, a call center worker at Wells Fargo based in San Antonio, Texas. “If diversity and inclusion is a priority for Wells Fargo, then we need to confront the bank’s biases head on. And just as frontline workers have to meet our sales goals and metrics, management must be held accountable to their goals for diversity and inclusion.”

The employment discrimination scorecard is the third report in CBB’s Better Bank Accountability Project, which scores the nation’s top banks on their workforce and consumer policies in the wake of the COVID-19 crisis. As part of the new analysis, previous scores issued July for banks’ immediate response to the COVID pandemic, including implementation of tele-work for branch and call center employees, and suspension of late fees, were adjusted with the new forbearance data.

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Methodology for Scorecard:

In developing this report, CBB reviewed 13 of the country’s largest banks’ publicly available employment data, focusing on outcomes of diversity programs for Black, Hispanic/Latino, and Asian workers – the three largest race groups in the U.S. The banks were ranked on: 1) Data Disclosure: the strength of disclosure related to workforce demographics; 2) Representation: the level of diverse representation within job classifications; and 3) Advancement: measurements of bias in advancement for employees of color.

Data Disclosure

To evaluate banks’ data disclosure, CBB attempted to collect workforce diversity statistics from each of the bank’s public websites. Banks that disclosed workforce diversity statistics that includes information about pay equity for each job classification received a “Superior” grade. Banks that disclosed workforce diversity statistics in EEO-1 or comparable format that includes the total number or percent of individuals in each job classification and race group received a “Satisfactory” grade. Banks that disclosed workforce diversity statistics in EEO-1 format but failed to allow for the calculation of the total number of diverse employees across job classifications and race groups received an “Unsatisfactory” grade. Banks that only disclosed limited workforce diversity statistics or none at all received a “Substandard” grade. Banks that failed to disclose any workforce diversity statistics received a “Nondisclosure” grade. 

Representation

 For representation, CBB compared banks’ diverse representation of workers in four job categories -- Entry-level, Professional, Mid-level, and Executive/Senior level -- to the National Community Reinvestment Coalition’s Racial and Ethnic Representation and Investment (RERI) framework. Banks with representation substantively above the industry average and approaching or at equitable demographic representation received a “Changemaker” grade. Banks with representation at levels significantly stronger than industry averages, in which the industry has low racial and ethnic representation received a “Strong Representation” grade. Banks with representation close to the industry average or demographic representation if the industry average equals or surpasses demographic representation received a “Moderate Representation” grade. Banks with representation below industry averages and the demographic proportion of the population received a “Poor Representation” grade.

Advancement

To analyze banks’ advancement, or promotion, opportunities, CBB used the methodology employed by the Equal Opportunity Commission (EEOC) in its 2006 report on diversity. Using data from each employment category, CBB calculated the odds for a worker holding a job in each category and compared that to the odds of a white worker holding the job in the same category. The ratio of the two proportions gives an indication of bias against employees holding positions of higher management. Banks were graded on where their odds ratio fell in quartile ranges for each job classification and race group based on industry averages.

The Committee for Better Banks analyzed data at the following banks: Bank of America, Bank of the West (BNP Paribas), Capital One, Citibank, Fifth Third Bank, HSBC (North America), JPMorgan Chase, PNC Bank, Santander Holdings USA, TD Bank, Truist Bank, US Bank, and Wells Fargo.

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About the Committee for Better Banks:

The Committee for Better Banks, a project of the Communications Workers of America, is a group of bank workers, community and consumer advocacy groups, and labor organizations, coming together to improve conditions in the banking industry. Committee for Better Banks members include current and former employees of banks and credit unions across the country, including Wells Fargo, US Bank, Santander, Bank of The West, and Bank of America.