Banking Briefing: Will WFH become a thing of the past?
- Banks are pushing to get employees back in the office – but what will that do for their efforts to attract tech talent?
- Meanwhile, gender inequality is alive and well in the banking industry. Here’s what one bank is doing to try and solve that.
Covid made work from home a standard practice within most industries, banking included. But as the world continues to tip-toe back into routine, many companies are either demanding their employees to return to the office, or, at the very least, firmly suggesting so.
And banks seem to be leading these back-to-office vibes, with an average attendance of 47%, according to recent research from Advanced Workplace Associates.
Source: Advanced Workplace Associates
Still, at this point, office attendance remains more of a hint at a lot of big banks.
Mega banks like Goldman Sachs and Morgan Stanley aren’t outright demanding their employees to return to the office. Rather, the feeling is very much akin to restaurant workers turning off the music and picking up chairs while they wait for the last customers to finally get the hint and leave.
In banks' policy language, that's translated into lifting the need for both Covid testing and vaccination:
- Goldman Sachs is removing the need for face-covering, vaccination, or regular testing in locations outside its New York offices.
- Morgan Stanley no longer requires its New York staff to get tested. It also said it will stop sending notifications to its employees in the state about exposure.
- JPMorgan hasn’t outright lifted any pandemic-linked policies, though Jamie Dimon hasn’t been shy about sharing his position against work-from-home culture. Meanwhile, it’s not that long ago the bank made the news for implementing ID trackers to make sure employees were meeting office quotas.
Putting things in context
To be fair, it’s not just big banks that are pushing for a return to the office. Even though tech remains the lowest category in office attendance, lots of major tech companies are taking steps to get their employees back to their office stations.
Alphabet, Amazon, and Microsoft have all been implementing policies requiring employees to return to the office. Not to mention Tesla, which pretty much threatened to fire workers who don’t abide.
Still, for banks the story may be a little different. Incumbents are sort of battling a reputation of being old-fashioned – that’s been leading to difficulty in attracting new tech talent.
And, if I’m being honest, when I read about Jamie Dimon’s grumpy comments regarding work-from-home, I couldn’t help but think of this meme:
The point is that the banking industry may need to work harder than others to show more modern, tech-forward colors. And that could boil down to simply letting their employees work in their PJs every once in a while.
3 questions with Dr. Anthony C. Hood, chief diversity, equity, and inclusion officer at First Horizon Bank
Slowly but surely, banks have been taking steps to improve financial equality within the industry. And progress is notable, though not near where it should be.
In its annual gender balance index, the Official Monetary and Financial Institutions Forum (OMFIF) evaluates where banks are at on a global scale in terms of achieving gender balance in senior roles within their organizations.
This year, the report notes some progress compared to the year before. Commercial banks received an average GBI score of 35, six points higher than their score last year. Central banks, meanwhile, received a score of 31, up four points.
But even with the improvements made, these numbers are pretty underwhelming. For context, a GBI score that reflects total gender balance in senior roles is 100. A score that would be considered decent, according to OMFIF, would be around 70.
Still, certain banks have been getting recognition for their efforts regarding this issue. First Horizon Bank is one of them: this year, the company was recognized by Bloomberg's Gender Equality Index, which tracks public companies' progress in promoting gender balance within their organizations.
For this week’s Q&A, Dr. Anthony C. Hood, chief diversity, equity, and inclusion officer at First Horizon Bank, dives into the behind-the-scenes of creating gender balance within the company.
1. What are some of the changes First Horizon has made in the past couple of years to improve gender equality internally?
We recently revamped our Diversity, Equity and Inclusion efforts. As part of this process, our team created a content strategy focused on highlighting underserved groups like women in leadership. During that process, we realized the unique financial needs and challenges women face. As a result, the bank created an initiative dedicated to empowering women’s financial lives, including specific capital and counsel for caretakers, those going through divorce, and estate planning.
Internally, our Women's Initiative Associate Resource Group, founded more than 20 years ago, plays a major role in the bank's Gender Equity Inclusion recognitions. The Women's Initiative is dedicated to helping women develop leadership skills, facilitate mentor-mentee relationships, and network with leaders and executives.
2. What have been the results since implementing these changes?
When it comes to hiring and promoting women in leadership roles, our bank continues to be a frontrunner in the finance industry. At First Horizon, women represent approximately:
- 66% of the overall workforce;
- 57% of manager roles;
- 36% of the Executive Officers;
- 24% of the Board of Directors.
For the fourth consecutive year, First Horizon has been selected for the 2022 Bloomberg Gender Equality Index and recognized by Forbes as one of the best employers for women. First Horizon is also proud of the progress made in representation on the executive management team and in key leadership roles such as CFO, COO and CHRO.
3. What are the biggest challenges in creating gender equality in the banking industry?
Men. Men are a significant barrier to gender equity. Women didn't create these inequities, men did. As such, the onus is on men to reach and sustain gender equity.
In most instances, there isn't a lack of qualified women to take on leadership positions. Women are more qualified than ever and also earning more degrees than men at every level of higher education (undergrad, master's and doctoral levels). We just have to be more intentional in institutionalizing policies, practices and procedures that are effective in attracting, retaining and elevating women leaders.
Until our industry normalizes incorporating diverse, equitable and inclusive leadership into the competencies and KPIs upon which leaders are selected, evaluated and rewarded, gender inequities will persist.
What we're reading
Match made in never
UBS made a big splash early this year when it announced its forthcoming acquisition of Wealthfront, a US robo-advisor, for $1.4 billion.
Now, the two companies have announced that they've terminated the merger but that UBS will buy a $69.7 million note convertible into Wealthfront shares.
Neither company has shared any information about why the deal was terminated.
The acquisition was supposed to play a big role in the bank’s digital transformation strategy and its ability to appeal to younger consumers going forward.
And that begs the question – now what?
One click away from more competition
In the latest development towards reaching its much dreamed of super-app-dom, Revolut has announced its newest feature, Revolut Pay: a one-click checkout option that puts the fintech in competition with companies like PayPal, Block, and Apple.
Revolut Pay has already signed on merchants like Shopify and WH Smith Plc. It also has plans to become available within the airline industry in the coming months.
Revolut users will be able to earn cashback through the feature, while shoppers who aren’t Revolut users can still use the feature through other card providers.
As for businesses, Revolut touts that companies will get paid within 24 hours – faster than other payment options.
Revolut will charge retailers a fee of around 1% for this service.
Getting iffy with fintech
At a New York conference on Wednesday, Michael Hsu, Acting Comptroller of the Currency, warned that the rise of fintech and digital banking could lead to some big financial risks.
For example, with banks teaming up with tech companies to create a better customer experience, customer safety may be taking a backseat, as regulators struggle to keep track of how these companies are collaborating.
"I worry increasingly about the 'unknowns' and am concerned that the less familiar risks of this digital transition are unlabeled and thus unseen. As we learned from the 2008 financial crisis, risks that are unseen have a tendency to grow and later to be the source of nasty surprises"