Rep. Waters Probes BlackRock, Fidelity, Other Asset Managers on Diversity and Inclusion

The subcommittee on Diversity and Inclusion is asking the 31 largest asset managers, including Schwab and Vanguard, for data.

House Financial Services Committee Chairwoman Maxine Waters, D-Calif., and Rep. Joyce Beatty, D-Ohio, chair of the Subcommittee on Diversity and Inclusion, want data from the nation’s 31 largest investment firms — including BlackRock, Charles Schwab, Fidelity and Vanguard — on their diversity and inclusion practices.

“We are making progress to ensure a comprehensive understanding of diversity and inclusion performance in the financial services industry,” Waters and Beatty wrote in a letter dated March 18, which Waters released Monday.

“However, this cannot be achieved until organizations, especially the largest investment managers, disclose their diversity data and policies with the [Offices of Minority and Women Inclusion] OMWIs, Congress, and the public,” they explained.

Waters and Beatty requested that the asset managers — those with $400 billion or more of assets under management — complete a questionnaire by April 30 regarding the firm’s diversity and inclusion data and policies from 2016 through year-end 2020.

Some of the lawmakers’ questions focus on:

“In addition, you may also include any recent policies and analysis that may further inform our review,” the lawmakers wrote.

Low Response Rate

Waters and Beatty noted in their letter that the OMWI at the Securities and Exchange Commission “sends a self-assessment to collect diversity data from its regulated entities annually, but noted in its March 2019 report that the responses from regulated entities ‘was lower than expected.’”

Although the SEC OMWI report “noted that the firms that did respond ‘employ nearly 47% of the employees in securities and other financial investments,’ we assert that all regulated entities should make a good faith effort to share performance data in response to their regulators’ self-assessment request,” Beatty and Waters said.

“Without access to this data, it is not fully possible to gauge the extent to which regulated entities are meeting the spirit and intent of Section 342” of the Dodd-Frank Act, which created the OMWI.

“One way full economic inclusion for all Americans can be achieved is when investment management firms provide transparency regarding their use of diverse-owned asset managers (those with more than fifty percent ownership by a woman or racial/ethnic minority) and tracking of their spend with other diverse-owned businesses,” the lawmakers’ letter states.

Firms on the List

Other asset management firms receiving the letter requesting data on their diversity and inclusion efforts are:

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