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Wells Fargo CEO remarks show mindset that sees Black worker training as ‘charity operation’

Sibile Marcellus
·Reporter
·2 min read

Last month Wells Fargo CEO Charles Scharf got in trouble after comments he made in June about reaching diversity goals surfaced in a Reuters article. He apologized for the “insensitive” comments he made in a company memo saying, “While it might sound like an excuse, the unfortunate reality is that there is a very limited pool of Black talent to recruit from with this specific experience as our industry does not have enough diversity in most senior roles.”

Politicians and celebrities were quick to criticize Sharf. Rep. Alexandria Ocasio-Cortez (D-NY), a member of the House Financial Services Committee, tweeted, “Perhaps it’s the CEO of Wells Fargo who lacks the talent to recruit Black workers.”

Faced with mounting criticism, Scharf issued an apology on Sept. 23, stating that “across the industry, we have not done enough to improve diversity, especially at senior leadership levels.”

Scharf’s initial statements are part of a mindset among corporate leadership that investing in Black workers is charity work, Brookings Institution economic geographer Annelies Goger told Yahoo Finance in an interview.

“The labor market doesn’t have a ‘skills gap’ – it has an opportunity gap,” Goger wrote in a recent report she co-authored with NOVAworks program manager Luther Jackson.

Goger and Jackson wrote that executives should focus on an economy “constrained by an opportunity gap: systematic social exclusion of diverse talent from access to education, economic security, quality jobs, and career mobility over a lifetime.”

Wells Fargo CEO and President Charles Scharf is seated before he testifies during a hearing of the House Financial Services Committee, on Capitol Hill, Tuesday, March 10, 2020, in Washington. (AP Photo/Alex Brandon)
Wells Fargo CEO and President Charles Scharf is seated before he testifies during a hearing of the House Financial Services Committee, on Capitol Hill, Tuesday, March 10, 2020, in Washington. (AP Photo/Alex Brandon)

A recent Federal Reserve survey shows the magnitude of the racial wealth gap in the U.S. The median wealth of a typical white family is $188,200 compared to $24,100 for a median Black family.

Goger said that corporations should invest in their own workers.

“Unfortunately, there’s a mindset that sees any kind of skill building work that a company does or...investing in education and training [for career mobility among its employees] as a charity operation and it’s often segmented off into like corporate social responsibility,” Goger told Yahoo Finance. “So it’s not really integrated into the core business of the company.”

Closing the opportunity gap will require “a little bit of self-awareness” among corporations seeking to increase diversity in their workforce about how they “are reproducing people that have similar characteristics instead of being open to more diverse talent pools,” says Goger.

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