Diversity and Inclusion in Bond Market

BDA Q&A with FINRA Diversity and Inclusion Leadership

Opening intro and thanks for contributing to the BDA’s Fixed Income Insights e-magazine
Q: Let’s start from the beginning. Why does FINRA have a dedicated D&I initiative, what’s the purpose and mission?
Our goal is to ensure that every employee has the opportunity to thrive and contribute their unique talents to our organization. FINRA’s diversity—meaning our backgrounds, education, cultures, thinking styles and unique perspectives—is a driving force behind our ability to effectively carry out our mission of investor protection and market integrity.
Our program also aligns with our corporate goals and values, and our objective to ensure principled industry conduct so that America’s investors have access to fair financial markets and the opportunity to prosper.
Q: I’ve read about the CEO Action for Diversity and Inclusion program. Please tell us about FINRA’s involvement in that initiative and the impact.
The CEO Action for Diversity and Inclusion program is the largest CEO-driven business commitment to advancing diversity and inclusion in the workplace. Nearly 2,000 CEOs have pledged to make our workplaces trusting places to have complex, and sometimes difficult, conversations about diversity and inclusion; implement and expand unconscious bias education and training; share effective practices and lessons learned; and engage boards of directors when developing and evaluating diversity, equity and inclusion strategies.
As a regulator, it was important that FINRA publicly model for the broader financial services community this important step. We knew it was important for our President and Chief Executive Officer, Robert Cook, to be an early signatory, and he signed on in June 2018. Many of our member firms have since joined as signatories and, collectively, we recognized that this collaborative effort was needed to create meaningful change both in and outside of the workplace.
In 2019, we invited CEO Action for Diversity and Inclusion founder, Tim Ryan, who is chairman and senior partner at PwC US, to talk to FINRA employees about this initiative during an organization-wide forum hosted by Robert.
Tim visited our Rockville, Md. campus in conjunction with a weeklong celebration of the 10-year anniversary of FINRA’s formal diversity and inclusion program. We hosted our first-ever Week of Inclusion, featuring several courageous conversations where employees engaged in candid, thought-provoking discussions about a number of key diversity and inclusion topics.
FINRA also hosted the CEO Action Check Your Blind Spots Unconscious Bias Bus Tour in Rockville. More than 300 FINRA employees boarded the bus, which offered virtual reality, gaming technology and other innovative techniques to help individuals better understand specific blind spots—unconscious biases—that can narrow their vision and influence behavior. Employees could also commit to the I Act On pledge, which invites individuals to take specific steps toward making their workplaces and communities more inclusive.
FINRA continues to offer resources to employees that incorporate our values, actions and perspectives and support our diversity, equity and inclusion programs. We reported on these in our FINRA Diversity & Inclusion Report 2020 Year in Review.

Q: And we realize it all begins at the top. How has FINRA leadership been important to this process?
Under the leadership of our President and CEO, our work in this space has only grown. And all of our employees are empowered to play a critical role in these efforts. With the help of FINRA’s executive leadership team and the guidance of our employee-led Diversity Leadership Council (DLC)—established in 2009 to develop and implement FINRA’s diversity and inclusion strategy—our core program centers on diversity awareness training and education, formal mentoring programs and a network of employee resource groups (ERGs).
One year ago, FINRA formed its first Racial Justice Task Force—our response to the call to action that was raised across our industry and country in the aftermath of the killings of George Floyd, Breonna Taylor, Ahmaud Arbery and so many other Black Americans. Shortly thereafter, Robert formally announced to the organization our commitment to pursuing racial justice and equity within our organization, our industry and the communities we serve.
Since making these commitments, we have received more than 70 ideas—what we are calling “Seeds for Change”—from colleagues across the organization. To date, we have begun implementation of more than 40 percent of the ideas. A great example is the creation of our Beacon Statement, our public affirmation that FINRA is an organization that takes a strong stance against racism and discrimination.
Other “seeds” we have adopted include additional awareness and engagement opportunities for our workforce and enhanced financial inclusion efforts, with an emphasis on communities of diverse cultures and socio-economic backgrounds. We have also taken initial steps to help break down unintended barriers in the industry and ensure we have diverse representation—both inside and outside our workforce.
For example, FINRA created and filled a role at the FINRA Investor Education Foundation to build strategic partnerships and manage public engagement initiatives that benefit underserved financial consumers and include people from diverse cultures and socioeconomic backgrounds.
Q: FINRA is clearly focused on and dedicated to building and maintaining a diverse workforce so kudos to you, to CEO Robert Cook and to everyone involved in this important initiative. How would you characterize the changes at FINRA as related to this initiative and how has it resulted in FINRA being not only a better place to work but also a better regulatory body for the securities industry?
FINRA’s ability to adapt and respond to the COVID-19 pandemic and racial justice concerns that spread across the country was only strengthened by the robust diversity and inclusion program we have.
In addition to what we offer through our diversity and inclusion program, FINRA is focused on building a workforce that mirrors the diversity of our communities and supports FINRA’s mission of investor protection and market integrity. Today, FINRA has nearly 3,600 employees whose diversity—backgrounds, education, cultures, thinking styles and unique perspectives—is a driving force behind our ability to fulfill our mission. To meet the demands of an ever-changing securities industry, FINRA must continue to be innovative in our approach to regulating broker-dealers and monitoring the markets. In response, we have expanded our recruiting efforts to ensure we attract candidates with the diverse skill sets and perspectives that enable us to respond appropriately to the dynamic broker-dealer industry we oversee. We are proud to be recognized for our hiring practices and the diverse and inclusive culture we strive to promote.
In 2020, we were recognized as an employer of choice by several organizations— including Working Mother Media Magazine for our holistic approach to generational and religious diversity, as well as Diversity Best Practices for our response to COVID-19.
In addition, in April 2021, FINRA issued Regulatory Notice 21-17, seeking comment on any aspects of our rules, operations and administrative processes that may create unintended barriers to greater diversity and inclusion in the broker-dealer industry or that might have unintended disparate impacts on those within the industry. We received 32 comment letters covering a broad range of topics and we are considering our next steps.
Q: Can you tell us a little about the Diversity Leadership Summit hosted by FINRA?
FINRA’s Diversity Leadership Summit is an annual forum for diversity practitioners and business leaders in the industry to share innovative ideas and effective practices to promote diversity, equity and inclusion in the workplace. The Summit provides an opportunity to build diversity and inclusion competencies and to learn from each other.
This year, we held our virtual event in September, featuring the Honorable Joyce Beatty (D-OH), Chair of the U.S. House of Representatives Subcommittee on Diversity and Inclusion, as our keynote speaker. And, we had stellar engagement, averaging more than 1,000 viewers during each session.
In addition to the Summit, we host a diversity segment at FINRA’s annual conference, featuring diversity thought leaders and focused discussions on the importance of embracing diversity, equity and inclusion as a strategic business priority.
Through the Summit and diversity and inclusion programming at FINRA’s Annual Conference, we reach more than 500 external stakeholders each year.
Q: Does FINRA work directly with FINRA members to help foster a D&I program within the member’s firm?
FINRA is committed to increasing diverse representation and building a more inclusive environment in the financial services industry. For example, we are actively engaged with the Securities Industry and Financial Markets Association (SIFMA) Diversity & Inclusion Advisory Council. SIFMA assists its member firms in developing their diversity initiatives to increase inclusion in the workplace and in their efforts to market to diverse customers. And, as we continue to share best practices from our robust diversity, equity and inclusion program, engage thought leaders at our annual summit and solicit industry and stakeholder feedback, we will continue our collaborative efforts to promote greater diversity and inclusion across the industry.
Q: How is FINRA working with / partnering with colleges and universities to build interest in the securities industry? How has this helped advance D&I within the securities industry?
In 2018, FINRA launched the Securities Industry Essentials (SIE) exam to streamline the examination process for prospective candidates seeking to enter or re-enter the securities industry. Our goal is to remove artificial or systemic barriers that might disadvantage or discourage industry participants for reasons that are unrelated to their capabilities and competence. Since we introduced the SIE, we have launched a multi-year, multi-media campaign to reach college students across the country. In addition, we have emphasized outreach to historically Black colleges and universities (HBCUs) and other minority-serving and diversity-focused organizations to expand the pool of candidates. For example, we launched a pilot program to distribute SIE exam vouchers to cover exam costs on a limited basis to HBCUs and other institutions for distribution to minority and socioeconomically disadvantaged students.
Another opportunity to diversify our industry is through targeted outreach to our veterans. Earlier this year, the U.S. Department of Veterans Affairs expanded the educational benefits provided under the GI bill to include the cost of the SIE exam. We hope this will help us to attract greater numbers of veterans to the financial services industry.
As I reflect on FINRA’s diversity, equity and inclusion programs and the strides we have made, I am energized and inspired by the combined efforts of FINRA’s leadership and employees, member firms and other stakeholders. There is still much more work to be done as inequality is deeply structural in our world, but together, we can create and maintain an environment we can all be proud of at FINRA and in our community.
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