July 28, 2021

Wells Fargo boss creates controversy with his comments about blacks

(New York) The boss of Wells Fargo, one of America’s largest banks, apologized on Wednesday for recently blaming the lack of diversity in his establishment on a lack of qualified black people.

Juliette MICHEL
France Media Agency

In a message addressed to the employees of the company, Charles Scharf tried to make amends by regretting having recently made “tactless comments” and reflecting his “own prejudices”.

“There are a lot of talented, diverse people who work at Wells Fargo and in the financial services industry and I never meant to suggest otherwise,” adds the executive, who took over as head of Wells Fargo in October to to restore the reputation of the establishment tarnished by a resounding scandal of fictitious accounts and several other cases relating to its commercial practices.

The controversial remarks were made by Mr. Scharf in a previous message dated June 18, consulted by AFP, in the midst of demonstrations in the United States against police violence against minorities and racial injustices following the death, in the hands of the police, George Floyd, a 46-year-old African-American.

If the bank has not succeeded in integrating more diversity within its operational committee, wrote Mr. Scharf, it is because of a “very limited pool of black talent with the necessary experience”.

Comments he allegedly reiterated in a Zoom conference with African-American employees at the bank over the summer.

Their publication Tuesday and Wednesday drew heavy criticism.

“Maybe it’s the boss of Wells Fargo who lacks talent to recruit black employees,” reacted with irony on Twitter the rising star of the Democratic Party Alexandria Ocasio-Cortez, from the diversity.

Al Green, another elected Democrat, judged for his part that “denying the existence of qualified black talent is a way for Wells Fargo to maintain the status quo and not respond to the need for greater diversity”.

Quantified objectives

On Wednesday, Mr Scharf admitted wrongdoing, saying the banking sector had “not done enough to improve diversity, especially at the level of its leaders.”

The firm has promoted a few people from diverse backgrounds to management positions in recent months, but they are still largely in the minority.

Mr. Scharf is committed to doing more, for example by diversifying the sources of recruitment or by developing racism awareness training for his employees.

For positions paid over $ 100,000, the big boss also demanded that the list of candidates include women and people from minorities.

The people on the operational committee will also be evaluated and remunerated on their ability to advance diversity within their teams, he assured.

The big Wall Street banks are regularly singled out for their lack of diversity in a financial world still largely dominated by white men.

The recent announcement of Jane Fraser’s appointment as head of Citigroup has made headlines as she is the first woman to head a major U.S. bank.

Certain women occupy top-notch positions, like the boss of the investment firm Fidelity, Abigail Johnson, and others are approached to succeed their boss.

But it is still men, white, who run JPMorgan Chase, Bank of America, Wells Fargo, Goldman Sachs or Morgan Stanley, the flagships of American finance.

In April 2019, the leaders of seven major Wall Street establishments were questioned by parliamentarians who asked them, during a televised hearing, whether their successor would be a woman or a person from minorities. None had responded.

The giants of Wall Street say they are making an effort.

Wells Fargo, which has 6% black people among its executives, pledged in June to double that number over the next five years.

BlackRock has pledged to double the number of black people among its leaders by 2024. They are only 3% right now.

The proportions are similar at Goldman Sachs, where 77.3% of executives are white and 2.7% are black.