Representatives of financial firms think the industry as a whole is doing a poor job of promoting diversity, but they feel their firms are making credible efforts, according to the participants in a series of recent roundtables.
Firms across the United States and in Toronto said they deserve scores ranging between average and good for their diversity programs. But when asked how the industry as a whole is doing in promoting diversity, the firm representatives said the performance was only fair. The choices were poor, fair, average, good and excellent.
The CFA Institute, which administers the chartered financial analyst designation, held roundtable discussions in five U.S. cities and Toronto during the fall of 2017 and spring of 2018 to talk about the diversity efforts financial firms are making. The sessions included 344 participants from 99 firms.
The first step in promoting diversity is to decide what the definition of diversity is, CFA said. “The definition can change over time, but without specificity you will not be able to set clear goals or focus,“ said the report.
The firms focus on gender, race, sexual preference, veterans, age and abilities. Following the roundtable discussions, CFA developed recommendations for promoting the inclusion of each of these groups.
“Diversity can include personality, age and background, in addition to race and gender,“ said Rebecca Fender, head of the Future of Finance initiative at CFA Institute, a long-term global effort to shape a trustworthy, forward-thinking investment profession.
Everyone has biases, and acknowledging them does not necessarily eliminate them, CFA said. Firms should “employ creative training techniques that will help uncover biases and provide tools to identify them in the future. Simulations and role-playing formats allow people to test real situations to see their natural reactions” and learn where biases affect actions.
Firm leaders should “encourage the use of stories within and across organizations to help people understand how experiences have shaped their colleagues and thereby enable greater leveraging of diverse perspectives,” the report said. This information can be used to assess the progress that is being made through diversity programs.
Senior executives also should engage in talks with other employees about diversity efforts.
The interview process is crucial in promoting diversity in the workplace. During the hiring process, interviewers should learn about the background and perspective of each candidate and consider how differences can be leveraged to improve the firm’s effectiveness, CFA said.