By Dorothy Savarese
After I became the first woman to lead Cape Cod Five, I was often met with questions and comments about what that “first” meant. I was reluctant to embrace its significance because I wanted first and foremost to be thought of as successful banker—not a successful “woman” banker, which felt like having an asterisk next to my accomplishments.But as I spoke with more inside and outside the industry, and with a customer on the Cape who said he was glad his daughter had a visible, local role model, I realized I was looking at it all wrong. The fact is that the less common some things are—whether it is women or minorities in banking or a left-handed Super Bowl winning quarterback—the more attention they attract. If that attention made me uncomfortable, then my task was to help make the rare more common.
It’s an easy goal to embrace because it aligns with the most fundamental objective of any organization: to succeed. Data show that organizations are more successful when they are informed and guided by diverse perspectives. According to a 2015 McKinsey study, companies in the top quartile for racial and ethnic diversity are 35 percent more likely to have financial returns above their respective national industry medians. And companies in the top quartile for gender diversity are 15 percent more likely to have financial returns above their norm. Bottom line: becoming more diverse is not just the right thing to do; it’s good for business.
As McKinsey notes, correlation doesn’t equal causation. But bankers would agree that to be successful, they must serve a broad community, and their staff and leadership must reflect that community. So McKinsey’s findings aren’t shocking. They are, however, increasingly urgent.
Banking is facing the most competition it’s faced in years. Between fintech disruptors, tax-advantaged nonbank competitors and the growth of a generation of customers—millennials —who are less convinced of the need for a banking relationship, banks must do all they can to differentiate themselves. The McKinsey report indicates that while some industries perform better on gender diversity and other industries on ethnic and racial diversity, no industry or company is tops in both categories.
That presents an opportunity. ABA is working to help banks seize that opportunity. We’ve already shone a spotlight on millennials and are following through on a special task force’s recommendations for appealing to them as both customers and employers.
Now a new task force is exploring ways ABA can foster greater involvement of bankers with diverse perspectives in both ABA and industry affairs. All that ABA does—from our training to our advocacy —would be enriched by the kind of diversity that comes from individuals of different race, ethnicity, age, gender, experiences and ways of thinking.
As we do our research, bankers should do the same. It begins with an honest assessment. Are you leaving any talent on the table by not finding new ways to nurture or tap it? For example, are you making any special efforts to reach out to men and women who have a different background than yesterday’s typical loan officer? Just as you might qualify customers differently for a mortgage loan, there is more than one way to advance an employee with leadership potential.
The payoff for doing so goes beyond better performance. Successful, diverse companies no doubt have an easier time attracting both talent and customers. As community leaders, our industry must embrace such a competitive differentiator. And in so doing—by comparison—become rare in our diversity rather than have our diversity be rare.
ABA Chairman Dorothy Savarese is chairman, president and CEO of Cape Cod Five Cents Savings Bank, Orleans, Mass.