Five of the nation’s largest banks are pushing shareholders to reject racial equity resolution audits after expressing solidarity with the Black Lives Matter movement.
According to Fintech Zoom, shareholders of Citigroup, Wells Fargo, Bank of America, Goldman Sachs, and JPMorgan Chase, which represent $1.2 trillion in assets, want the banks to conduct racial equity audits.
Shareholders are urging their banks to have their practices and policies reexamined by a third party to identify ways to avoid the negative impact on communities of color. The banks, however, have all pushed back against those calls and other changes saying they’ve done enough to address racial equity.
According to MarketWatch, the CtW Investment Group wrote in its proposal to Citi shareholders, the bank “has a conflicted history when it comes to addressing racial injustice within the community it serves.” The group also cited several examples including when Citi was fined $25 million in 2019 for violating the Fair Housing Act.
Citi sidestepped CtW’s concerns in its response.
“While we disagree with the overall approach in this proposal, we are completely aligned with its stated goal of addressing racial inequity in the financial sector,” Citi said according to MarketWatch.
Bank of America largely did the same. CtW mentioned in 2018 the Treasury Department found the bank offered proportionately fewer home loans to minorities than white applicants in Philadelphia. Additionally, CtW said Bank of America’s C-suite is just 8% Black.
In its response, Bank of America referenced in its $1 billion commitment to supporting minority-owned businesses, job initiatives, and affordable housing programs.
Shareholders of Wells Fargo mentioned its history of discriminatory lending practices that have led to multiple lawsuits and settlements of employment discrimination claims. Shareholders at Goldman Sachs and JPMorgan Chase also mentioned their racial issues in the past, including that Wells Fargo profited off police brutality and JPMorgan’s $55 million settlement of a federal lawsuit related to mortgage discrimination.
All the banks mentioned their recent pledges and donations last summer but added that more is not needed.
All five banks made racial equity and DEI pledges last summer after the deaths of George Floyd and Breonna Taylor last summer. Now, it appears as if those pledges are falling short.