On the occasion of Black History Month, we wanted to update our valued Abacus community on the steps Abacus continues to take towards equality and inclusivity in the financial services community. Our initial Black Lives Matter statement in June of 2020 has been a welcome catalyst for reflection and change, earning its place in our company’s history by marking a significant prioritization of this important work.
Changes for Abacus
In addition to company-wide testing for employee bias assessment and training, Abacus is participating in the Black and Latinx internship co-sponsored by NAPFA. This internship is a grassroots program for aspiring Black and Latinx financial planners that hopes to change the complexion of the financial services industry.
Changes for the Financial Community
Abacus is also dedicating itself to a new Due Diligence Commitment. This commitment encourages asset owners and advisors to use an alternative (but not concessionary) framework so that meaningful capital can shift into the control of BIPOC (Black, Indigenous, and People of Color) managers. One of Abacus’ core fiduciary responsibilities is to act with care regarding the future and in the best interests of our clients. Emerging research shows that not investing in the BIPOC community and with diverse-led managers could negatively affect financial returns, so making a strong moral choice also turns out to be a strong financial choice as well.
Changes for Financial Education
In academic news, CEO Brent Kessel recently wrote a paper entitled Two Financial Plans: The Next Fifty Years of the Racial Wealth Gap and What You Can Do About It with Kamila McDonnough, the Chair-Elect of the CFP® Board, and Ako Nkem-Ndofo, a history and political science major at Yale University.* Our hope is that industry accreditation boards and advisory firms will use this paper to increase financial literacy among BIPOC consumers, while also increasing awareness for the 88,000 CFP® Professionals whose financial planning interventions can have the most positive impact on narrowing the racial wealth gap.
Finally, we have made several meaningful changes in our own human resources and hiring practices. We have removed certain education requirements for several operational roles in the company, which ensures equal access and consideration for a broader set of applicants. We have also removed options for job candidates to add pictures, and removed our ability to see pictures from LinkedIn. This helps us avoid any physical appearance bias from unintentionally entering our hiring process. We have also created new, more consistent feedback rubrics for applicants, have gotten rid of internal referral bonuses to ensure employees are not choosing candidates from existing social networks, and have formed a more diverse recruiting pipeline through community involvement and employee and leadership participation programs such as the FPA externship.
Just as a financial plan is not created one time and then never adjusted again, so too will our efforts at diversity, equity, and inclusion unfold over many years and even decades. These are modest steps, but mindful ones that serve to enrich our community while protecting — and perhaps even improving — all of our clients’ best financial interests. We continue to be grateful to our many stakeholders across many walks of life who support this work.
*We will share the paper upon publication.