WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) today released a report summarizing strategies for promoting diversity and inclusion used by mortgage industry participants. It highlights the business case for diversity along with current approaches and practices used in the mortgage industry, such as establishing buy-in from top leadership, integrating principles of inclusion in recruiting and hiring, and the importance of data in assessing the impact of diversity on keeping organizations competitive. The report is the result of the CFPB’s collaboration with the financial services industry to raise awareness of the importance of strengthening diversity and inclusion within organizations.
“The Consumer Bureau’s mission is to protect all consumers across the diverse American marketplace, just as financial institutions seek to serve them with helpful products and services,” said CFPB Director Richard Cordray. "The insights in this report from our roundtable with mortgage lenders help to show the advantages of integrating diversity and inclusion programs in workplaces throughout the financial services industry."
The CFPB’s Office of Minority and Women Inclusion (OMWI) convened an industry roundtable meeting in collaboration with the Mortgage Bankers Association (MBA), which has shown notable leadership on these issues, and today’s report is a readout of that meeting. The roundtable convened representatives from the mortgage industry, including from larger and smaller banks, as well as some nonbank financial companies. Some participants were the primary executive leaders of their companies and others led units such as mortgage banking, neighborhood lending, or human resources. The roundtable also included OMWI staff from other federal agencies, including the Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corporation (FDIC), Federal Reserve, and Federal Housing Finance Agency (FHFA).
Through the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Congress required the creation of an Office of Minority and Women Inclusion at the following agencies: Treasury, FDIC, FHFA, OCC, National Credit Union Administration, Securities and Exchange Commission, CFPB, Federal Reserve Board, and each Federal Reserve Bank. Each of the OMWI directors is charged with developing standards for the diversity of the agency workforce, increasing diversity in agency programs and contracts, and assessing diversity policies and practices of entities regulated by the agency.
The report highlights issues raised by the roundtable participants, including current approaches, and underscores the need to develop a strong business case for diversity and inclusion. The speakers stressed how their businesses were being affected by the changing demographics of their customer base. They noted that a diverse and inclusive workforce was especially important to help them attract and retain the talent and perspective they need to solve new and complex problems, create innovative solutions, and improve business outcomes in face of this growing challenge. The report discusses strategies and practices on topics including:
- The business case for diversity and inclusion: The roundtable participants shared that embracing diversity and inclusion made business sense for their organizations. Participants that analyzed how diversity and inclusion can strengthen organizations found that it improved overall performance and leads to a more positive and productive workplace.
- The importance of leadership buy-in and accountability: A strong theme was the importance of the “tone from the top” of the organization, without which many speakers said it is virtually impossible to sustain a successful diversity program. Strong leadership on diversity and inclusion issues aligned organizations to build in diversity and inclusion as fundamental principles.
- Recruiting, hiring, inclusion, retention, advancement, and engagement: Participants shared that principles of inclusion are vital in developing and sustaining a diverse workforce over time. Organizations noted that they sought to boost retention levels and advancement prospects of people with different backgrounds and viewpoints. Another goal reported by participants is to make sure that discussions and decisions within the organization reflect the more robust analysis and broader understanding that can result from multiple viewpoints.
- Broadening the customer base with new business products: Participants explained that a more diverse workforce fosters greater understanding of the particular needs and situations of a more diverse customer base, including tailoring products to the needs of different consumers. Participants saw this as a key approach to attracting and satisfying a broader base of customers.
- The importance of data: Data collection and analysis play an integral role in supporting many of the participating organizations’ business cases for diversity. Some participants noted that understanding the demographics of an organization’s workforce is key to ensuring that it reflects the available talent pools and remains competitive and effective.
The Consumer Financial Protection Bureau (CFPB) is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. For more information, visit www.consumerfinance.gov.