Wells Fargo CEO Apologizes for Diversity Comments

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Wells Fargo CEO Charlie Scharf has apologized for claiming that his bank lacks diversity due to “a very limited pool of Black talent to recruit from,” a comment that recently stirred controversy online.

In a memo to all employees, Scharf takes responsibility for what he calls “an insensitive comment reflecting my own unconscious bias.”

“There are many talented diverse individuals working at Wells Fargo and throughout the financial services industry and I never meant to imply otherwise,” he wrote. “It’s clear to me that, across the industry, we have not done enough to improve diversity, especially at senior leadership levels. And there is no question Wells Fargo has to make meaningful progress to increase diverse representation.”

“Our progress will not be a straight line”

Reuters first reported Scharf’s questionable comments, which he wrote in a June memo amid national protests for racial justice. He acknowledged in that memo that the corporate world was not as diverse as it ought to be, writing “We need more diverse representation on our operating committee,” referring the bank’s top executives. But he seemed to deflect blame for the company’s diversity problem.

“While it might sound like an excuse,” Scharf wrote at the time, “the unfortunate reality is that there is a very limited pool of Black talent to recruit from.”

“Our progress will not be a straight line given the experience required in some of our roles,” he wrote, “but I would ask that you judge our progress two years into my tenure as CEO.”

While it’s easy to pick apart the memo, the truth is, Scharf was reflecting on the very real nature of systemic inequality. Whether or not there are qualified Black candidates to take on executive positions at his company, Scharf may not see a diverse talent pool because of a lack of diversity even in the lower rungs of Wells Fargo. If Black students are excluded from universities, internships, and entry-level positions, as time passes, fewer medium-level positions will be filled by Black employees. Ultimately, the so-called talent pool for choosing executive-level candidates becomes virtually monochrome.

If Scharf is serious about making the company’s executive suite more diverse, he needs to start at the bottom. The company’s strategy must be to attract young, up-and-coming candidates that reflect the country’s diversity. Only then will that big, diverse talent pool come into being.

Systemic Change

On Tuesday, Representative Alexandria Ocasio-Cortez blasted Scharf’s comment about a limited talent pool. The young progressive tweeted, “Perhaps it’s the CEO of Wells Fargo who lacks the talent to recruit Black workers.” But it’s important to remember that systems of inequality developed over the course of centuries in the United States. If we want to see substantial, systemic progress, it will take more than a tweet and a few months to fix. Instead of looking at the executive suite and wondering why it’s so homogenous, Wells Fargo and other companies must begin by investing in young, diverse candidates who are just starting their careers.

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