Apr 19, 2024 - Business

Why Jamie Dimon defends DEI when so many CEOs have gone silent

Photo illustration of Chairman and CEO of JPMorgan Chase Jamie Dimon surrounded by various shapes and colors overlayed on a conference table full of people

Photo illustration: Sarah Grillo/Axios. Photo: Win McNamee/Getty Images

In his shareholder letter last week, JPMorgan Chase CEO Jamie Dimon actually talked about his bank's commitment to diversity, equity and inclusion, though he didn't use the now-reviled DEI abbreviation.

Why it matters: Dimon's words stand out at a time when most CEOs have gone silent — or openly hostile — on these programs, amid widespread backlash.

State of play: In his letter, Dimon touted a range of programs — from resource groups for employees who are Black, LGBTQ+, or have disabilities to a fund aimed at helping entrepreneurs of color, investments in rural communities, and recruiting efforts at historically Black colleges and universities.

  • He also said that the $30 billion racial equity commitment the bank made in 2020 was "nearly completed" and would become a permanent part of the business.
  • "We're thoughtfully continuing our diversity, equity and inclusion efforts," he wrote, adding that they'll work to ensure programs conform as the laws evolve around these issues.

Zoom out: In his letter, Dimon says these diversity efforts are good for business.

  • Reaching more communities, for example, means growing the customer base. Casting a wider net to find talent means you're finding the best people. Helping entrepreneurs succeed is a way of creating more business for the bank down the line.
  • He also defended these efforts for other reasons. "There is nothing wrong with acknowledging and trying to bridge social and economic gaps, whether they be around wealth or health. We would like to provide a fair chance for everyone to succeed — regardless of their background."

The big picture: Many financial sector CEOs see diversity efforts this way, says Joelle Emerson, the founder of a diversity consulting business that works with big companies on DEI.

  • But few are willing to say this publicly, she adds.

What they're saying: "Every day, we work to enable equitable pathways to opportunities for employees, customers and communities to grow and thrive," Thelma Ferguson, the bank's global head of diversity, equity and inclusion, said in an email statement to Axios.

  • "It's how we strengthen our culture, future-proof our business and do our part to help lift the economy for all."
  • Since 2020, on the bank's org chart, Ferguson has reported both to the bank's chief operating officer and to the HR department. That's a sign that diversity efforts are directly tied to the business — and likely means Dimon has a good sense of their effectiveness.
  • At many companies, the diversity officer just reports to human resources while chief executives are more disconnected from what's happening on the ground.

Follow the money: JPMorgan Chase is the biggest bank on the planet with enormous legal and compliance resources and is well-equipped to handle a thorny DEI landscape.

Between the lines: A lot of the companies now running scared from diversity just started investing seriously in these efforts in 2020, as race consciousness swept corporate America.

  • Banks and financial institutions have been working on these programs for decades, partly as a way to fend off lawsuits — not from anti-DEI activists but from employees, customers, the federal government, and others over claims involving bias and harassment.
  • JPMorgan has been sued over race discrimination, sex discrimination, and more, in some cases paying millions to settle claims.

Flashback: Dimon was running Smith Barney in 1996 when the investment firm was sued by 25 women for sexual harassment — a landmark case, known as the Boom-Boom room lawsuit for the boozy basement area in the firm's Long Island office where female brokers were allegedly harassed.

  • Part of the settlement in that case included $15 million for diversity programs to encourage the hiring of women and minorities.

For the record: "Jamie was championing DEI work well before the Smith Barney suit," Allison Kahn, the bank's global head of DEI communications, tells Axios in an email. "[H]e was visiting and recruiting from HBCUs, including Spelman, and holding sessions with diverse employee groups from underrepresented backgrounds."

  • "When any problems surfaced, he dove into them immediately to ensure they were fully investigated and mitigated."
  • The bank's programs aren't the result of lawsuits, she says. They've "long been about helping to create opportunities and about getting, keeping and recognizing the best people."

The bottom line: Diversity programs are useful to financial institutions and unlikely to go away.

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