“DEI is part of our DNA,” Citigroup Inc.’s head of talent said in an interview just two months ago, calling it not only a priority, but “a business imperative.”
The bank’s U-turn came fast.
On Thursday, Chief Executive Officer Jane Fraser announced she was ending the diversity, equity and inclusion goals she set out less than three years ago in what was one of the industry’s most ambitious and concrete commitments, citing an executive order by President Donald Trump that banned “illegal DEI” policies by federal contractors like her bank.
It is also a sharp change from five years ago, when George Floyd’s murder prompted executives across the industry, including Fraser, to push loudly on behalf of underrepresented employees in their firms and among clients. Trump’s legal threat could now undo Wall Street’s slim progress — and come as a relief for executives who by many measures were failing to show meaningful results anyway.
“Ending these policies with such alacrity suggests they weren’t deeply embedded or well understood in the first place,” said Alan Houmann, a 16-year veteran of Citigroup who led EMEA government affairs until 2023, speaking of the DEI retreat across the sector. “It’s disturbing to see how easily and quickly the Trump agenda is forcing change.”
Piecemeal retreats were already starting to happen, and it’s now likely that Citigroup’s sweeping announcement on the back of Trump’s order will become just one prominent move in a sea of hasty DEI cut-and-runs in the sector.
Companies in other industries, including Accenture Plc and PepsiCo Inc., have dropped representation targets and pulled back from DEI efforts after Trump revoked a longstanding order directing federal contractors to take affirmative measures to ensure equal opportunities for women and underrepresented groups. The president also told them to affirm that they don’t engage in “illegal” DEI efforts.
Earlier this month, JPMorgan Chase & Co. CEO Jamie Dimon labeled some DEI programs a waste of money. “I saw how we were spending money on some of this stupid sh-t, and it really pissed me off,” Dimon said. The top job at his bank’s biggest initiative to support Black employees, Advancing Black Pathways, has also been vacant for months.
A spokeswoman for JPMorgan said the bank was actively interviewing for the position. It doesn’t have either private or public aspirational percentage goals to increase diversity, she said.
Bank of America has aspirational goals it hasn’t publicly broken out that it’s likely to roll back, according to a person familiar with the matter. At rival Wells Fargo & Co., a page about DEI was removed from its website in recent days.
Representatives for Bank of America and Wells Fargo declined to comment.
At Morgan Stanley, 2021 goals to increase the percentage of female, Black and Hispanic representation were absent from its September ESG report. The bank no longer has such specific DEI targets, a spokesperson said. “Commit to Diversity and Inclusion” was still included as one of its core values in a filing on Friday.
At Goldman Sachs Group Inc., which earlier this year ended a mandate for diversity on boards of companies it advises on IPOs, one specific target to lift diversity is still public. In 2020, Goldman aimed for women to make up 40% of its vice president population globally and reach 7% representation for Black professionals in the Americas and UK by this year, according to its website.
Women have been pushing for more opportunities for decades at Citigroup and its predecessors. In the 1990s, for example, the company that would eventually become Citigroup’s investment bank and wealth arm adopted specific targets as part of a class-action lawsuit settlement. For several years, the firm made sure 25% of its entry-level investment-banking hires were women.
Citigroup is still the only major bank to have a female CEO and has the lowest proportion of white men in US executive and manager roles of its peers, according to data reported to the government. In a note to staff last week, Fraser said the bank would “aim to retain the benefits that come from having a global and diverse colleague base.”
But inside the bank, some employees were still pushing for more progress, and are now concerned that the latest move will limit it further.
At its very top, the bank, which never published updates on progress toward the now-canceled targets set in 2022, is the least gender-diverse compared to major US peers. Women make up just 17% of its 18-person executive management team, compared to 47% at rival JPMorgan Chase & Co.
Like many firms, Citigroup’s investment bank remains heavily male-dominated. Among the roughly 150 managing directors who lead products, sectors or regional coverage, fewer than 10 are female — and no women are among the investment-banking deputies of Head of Banking Vis Raghavan, according to people familiar with the matter.
One vocal advocate of diversity has been Mark Mason, Citigroup’s chief financial officer, one of the most senior Black men on Wall Street, who has helped with recruiting efforts from historically Black colleges.
Congresswoman Maxine Waters, the highest-ranking Democrat on the House Financial Services Committee, has pushed financial firms for years to diversify their workforces, and said their recent backtracking has been disappointing.
“I was shocked and dismayed at how quickly they ran away from diversity, equity and inclusion,” she said by phone. “I’ve always been suspicious of the banks, but I never expected them to run away from their commitments so quickly.”
