Good morning,
Investment management and strategy leaders usually hold their cards close to the vest when the competition is around.
“It’s not a natural act to lock arms with competitors in my field,” Ali Dibadj, CFO and head of strategy at AllianceBernstein, a global investment-management and research firm, told me.
But there’s one area where Dibadj says CFOs are increasingly collaborating: “D&I transcends competition. D&I is about fairness.”
Dibadj was appointed CFO of AllianceBernstein in February, where he was previously the head of Finance & Strategy. He joined the firm in 2006 as a senior analyst for AB Bernstein Research Services. Dibadj and I spoke recently about how he’s planning to keep diversity and inclusion at the forefront of his C-suite job.
For starters, he credits the collaboration he’s seen as a member of the financial services community group within CEO Action for Diversity & Inclusion. Launched in 2017, the coalition now has leaders from almost 2,000 companies as signatories. “Our CEO Seth Bernstein signed the pledge in 2018 for CEO Action, and that really got the ball rolling,” he said.
The group is where he’s created a network of peers to exchange best practices on creating key measurements for diversity and inclusion like employment engagement surveys, as well as sharing effective ways to source and develop talent, he said. “You have the ability to do that with hundreds of companies,” he added.
Internally, “we measure diversity and inclusion and hold our leaders accountable for it,” Dibadj said. AllianceBernstein confirms that it ties diversity goals to “executive performance.” (In Corporate America there are still relatively few companies that tie DEI goals to goals to compensation.)
“What’s been interesting to me in this journey is that the link between financial and business health is crystal clear through D&I,” he said. “Being representative of society, helping the world around us be more fair is all linked to financial, physical and economic health. As CFOs, that is what we’re supposed to do. That is our job.” AllianceBernstein, which is publicly traded, has seen its stock rebound from pandemic lows of around $18 to nearly $40 and was recently upgraded to a ‘buy’ by Zacks based on an upward trend in earnings estimates.
To be sure, AllianceBernstein is still a work in progress. Although 43% of new hires are women, that number falls to 22% of senior employees, according to its website. That’s part of a broader pattern across Wall Street, which has had a harder time than other industries keeping women in the leadership pipeline. “CEO Action is a journey,” Dibadj said. “It’s not an initiative. It’s a part of our strategic plan for the long term at AllianceBernstein.”
At a time when stakeholders and investors are increasing holding companies accountable for ESG, CFOs are tasked with measuring the sustainability and determining the financial value. “From a CFO perspective, a financial organization’s perspective, we measure everything,” Dibadj said. “That’s kind of what we do.”
Has the role of the CFO evolved in your own organization? Reach out and let me know what you’re seeing.
See you tomorrow.
Sheryl Estrada
[email protected]
Big deal
The first installment in Grant Thornton LLP's new quarterly CFO survey series found most respondents are "focused on growth and turning the lessons from the pandemic into a road map for the future," according to the report.
Going deeper
PwC UK and the Center for Corporate Governance at the London Business School released a report, “Paying well by paying for good,” which takes a look at the academic evidence around ESG in pay and company practices. Almost half (45%) of FTSE 100 companies in the UK surveyed for the report now incorporate an ESG measure into their executive incentive plans. "ESG targets in pay have their place," but are not the cure-all solution, according to the report. Boards should consider why they want to incorporate ESG metrics into pay and determine whether it supports long-term shareholder value or conflicts with shareholder value, the report advised.
Leaderboard
Michèle Huiban was named CFO of Travelzoo, a global Internet company. Huiban is a global executive with experience in the media, entertainment, and fashion industries.
Fredrik Nihlén was named CFO of Neonode Inc., effective on or about Aug. 2, 2021. Maria Ek will remain in her position as the company's CFO until Nihlén begins the role.
Overheard
"Vaccines and fiscal stimulus have given us a much needed shot of adrenaline in what has become a marathon of a pandemic."
— Diane Swonk, chief economist at Grant Thornton, told CNBC in regards to a survey that found upbeat CFO sentiment on the global economy.
