Each year, Vault surveys thousands of banking and accounting professionals, asking them to rate their firms in several workplace categories. These categories include compensation, benefits, hours, work/life balance, training, relationships with managers, promotion policies, and business outlook. They also include diversity. And when we ask about diversity, we ask professionals to rate their firms in three areas: female diversity, LGBTQ+ diversity, and racial diversity.
In the wake of the worldwide anti-racist protests and rise of the Black Lives Matter movement, we took a closer look at how bankers and accountants responded to our racial diversity questions in our latest banking and accounting surveys, paying particular attention to the differences between how black and white professionals viewed their firms' diversity efforts. Below is a summary of what we found.
Black banking professionals rate their firms 23 percent lower than white professionals when it comes to diversity and inclusion
Last fall, a total of 3,299 banking professionals took our annual Banking Survey. Of those that answered a question about their ethnicity, 74 percent identified as White/Caucasian, while 2.7 percent identified as African-American/Black.
When asked to rate their firms on a scale of 1 to 10 in racial/ethnic diversity where 1 means "needs a lot of improvement" and 10 means "effective and receptive," white banking professionals gave their firms an average rating of 8.00, while black professionals gave their firms an average rating of 6.48—which is 23.46 percent lower.
The overall average racial diversity score given by professionals of all ethnicities (white, black, Asian, Hispanic/Latino, Native/American Indian) was 7.90.
Meanwhile, when we ask survey respondents to comment on their firms' diversity efforts, here is a sample of what black banking professionals told us:
- "My firm has very few women, people of color, and openly LGBTQ+ individuals. There's clearly room for improvement across the board."
- "Diversity seems to only be celebrated during awareness months."
- "We need to retain more black talent, nurture them, and promote them."
- "There's a distinct lack of diversity on the banking side and in management roles for women and minorities."
- "A concerted effort to improve diversity is beginning to pay off, but there's still more work to be done among the African American and Hispanic communities."
Black accounting professionals rate their firms 21 percent lower than white professionals when it comes to diversity and inclusion
This past winter, a total of 10,173 accounting professionals took our annual Accounting Survey. Of those that answered a question about their ethnicity, 80 percent identified as White/Caucasian, while 2.6 percent identified as African-American/Black.
When asked to rate their firms on a scale of 1 to 10 in racial/ethnic diversity, white accountants gave their firms an average rating of 8.36, while black professionals gave their firms an average rating of 6.89—or 21.34 percent lower.
The overall average racial diversity score, given by professionals of all ethnicities (white, black, Asian, Hispanic/Latino, Native/American Indian), was 8.30.
Meanwhile, when we ask survey respondents to comment on their firms' diversity efforts, here is a sample of what black accounting professionals told us:
- "The firm really needs to work on promoting Black employees to upper management positions. Having a diverse staff (and by diverse I'm talking about Black) at the associate level is not enough."
- "There's a lack of diversity with respect to racial minorities. Less than 30 employees out of around 800 are African-American. This shouldn't be seen as acceptable in a region where African-Americans make up a much higher percentage of the population."
- "More representation of black and brown males is necessary."
- "Minority and LGBT diversity has never been discussed with me. Those words don't exist here. It doesn't seem like that's a priority here at this firm."
- "Minority groups exist for women, LGBTQ, and others, but unless you're in an office like D.C. or New York, diversity doesn't exist."
There seems to be two main takeaways from our survey findings. First, although our surveys are by no means a complete demographic representation of investment banking and accounting, the low percentage of black professionals taking our surveys indicates that these industries need to do much better when it comes to hiring black candidates. Given that the U.S. black population is 13.4 percent, 2.7 (the percent of black professionals that took our banking survey) and 2.6 (the percent of black professionals that took our accounting survey) are extremely low in comparison.
Second, with respect to both banking and accounting, our survey findings point to a significant difference between how black and white professionals generally view their firms' racial diversity efforts. Of course, within both industries, the success of diversity and inclusion efforts varies from firm to firm, and from region to region. But overall, the takeaway here seems to be this: if banking and accounting firms want to know how they're really doing when it comes to the hiring, retaining, and promoting of black professionals—and truly improve in these areas—they should be asking for and closely listening to the views of their black professionals.
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