Both the financial services industry and the agencies that regulate it could benefit from greater diversity, agreed leaders from the business and regulatory worlds who recently attended an Opportunity Summit in Washington, D.C.
The half-day event at the National Press Club was organized by The Greenlining Institute and featured Rep. Maxine Waters (D-Calif.), who authored the language in the Dodd-Frank financial reform law that created Offices of Minority and Women Inclusion in all of the federal financial regulatory agencies.
In addition to extensive discussion of how to bring diverse leadership into the staffs and executive suites of financial institutions and the agencies that regulate them, speakers also focused on contracting practices and how both banks and communities can benefit when minority-owned small businesses have a fair chance to compete for contracts with financial corporations.
“Diversity isn’t just a feel-good policy for communities of color, it’s necessary for a healthy economy,” said Greenlining Institute Executive Director Orson Aguilar. “During the housing bubble and subsequent crash, we saw what happens when regulators lose touch with what’s happening in diverse communities.
“Right now,” he continued, “for every dollar of wealth a White family owns, the median Asian family has 63 cents, the median Latino has seven cents, and the median African-American family has less than a nickel. In a nation where ‘minorities’ will soon be the majority, that level of inequality is an invitation to disaster. And the financial sector is one of the keys to avoiding that disaster.”
Prof. Cheryl Nichols, who teaches business law at the Howard University School of Law, framed the issue succinctly, saying, “The economic empowerment of communities of color is one of the most important civil rights issues of our time.”
Several federal officials spoke of the need to ensure that their agency staffs represent a wide variety of backgrounds and experiences, a process that is being facilitated by the newly-created Offices of Minority and Women Inclusion (OMWI).
“We’re building a new agency from the ground up,” said Stuart Ishimaru, OMWI Director at the Consumer Financial Protection Bureau, which was also created by the Dodd-Frank law. “Because our job is to serve a diverse public, we need to build in diversity and inclusion from the ground up as well.”