FT. LAUDERDALE, Fla.–Is your credit union the next Starbucks, suddenly finding itself in the glare of negative publicity due to bias?
The risk is there, according to one person who has worked with credit unions around the country as they seek to be more diverse in both personnel and culture.
“The reality is your organization could be the next Starbucks if you are not focused in this area,” said Ronaldo Hardy in remarks to the CUNA HR, Training and Development Council here. “Just one incident where one employee does not adequately reflect the values of your organization, and you could find yourself in the same situation.”
Hardy, who is CEO of Southwest Louisiana Credit Union and who also consults and does training through the firm Divercity Solutions, said it’s imperative for every credit union to recognize the new civil rights movement is people voting with their dollars.
“We are going through a modern day civil rights movement,” he said. “There is the MeToo movement. You see LBGBQ. You see voices being elevated. When you are in a civil rights movement, one thing you see is the idea of economic empowerment and how that drives decision-making. People realize their dollar can control decisions and they begin to make decisions with their dollar to get those changes made. This could have an impact on our bottom line.”
Unconscious Bias
Hardy, whose remarks were themed “The Elephant in the Room,” said everyone in credit unions must recognize that as hard as they may try or however they make think of themselves, it’s natural for people to favor those who are like themselves as part of unconscious bias.
“We have to work collectively to think outside of that and position our organizations to make for the best possible diversity of our organizations,” Hardy said.
Credit unions that don’t reflect their communities are not just underserving people, the credit union itself is missing out on opportunities, he said.
And a credit union does not get off the hook just because it has made moves to hire more diverse front-line staff.
“At the very top, where the decision-making is made, there needs to reflect the community,” said Hardy. “We need to think about how this affects our hiring process, whether we are screening applicants in the right way, whether are we advertising for positions in the right place.
“We need to think about consumer relations,” he continued. “How are we interacting with our membership base? Are we engaging them appropriately? Have we taken time to understand how our decisions are impacting others?”
Pointing to several national advertising campaigns that had to be pulled because they were insensitive, Hardy observed, “If we haven’t made right decisions in how we hire, there is no one at table to say this could go wrong.”
Another Unconscious Bias
Speaking to unconscious bias and how it manifests itself in human resources, Hardy ran his audience through an exercise in which various names and even email addresses led to immediate conclusions about who the person is. He noted that with a first name like Ronaldo, he is often thought to be Hispanic, even though “I’m just a black man whose name is Ronaldo.”
But diversity and inclusion aren’t just about race and gender, Hardy noted on several occasions. Bias can come from seeing credit scores (still permissible in some states), for instance.
“In many of our organizations we pull a credit file, and we run across a 560 (score) and make a decision right at the beginning that we don’t want that employee because we have made a determination over what kind of employee they might be,” said Hardy. “When I first got into credit unions, my credit score was 560. Because my parents did not have money, they did not teach me about money. I got credit card offers, I took them. My parents gave me a car, but it wasn’t good enough, so I went and got another one. I dropped out of school, even though I was on scholarship. Maybe we have been trained to believe that certain characteristics mean a person is going to be a certain way.”
Hardy shared that the course of his life changed when he was hired at a call center company and the hiring manager decided to take a chance on him after he disclosed his credit issues. Over seven and a half years with the company, he was promoted seven times, but only after that one person looked past his or her own biases.
National Labor Numbers
In the United States, whites currently make up approximately 69% of workforce, while minorities comprise the remaining 31%.
“But that is rapidly changing,” he said. “I say take this and dive deeper in your communities. What are the statistics in your community and does your credit union reflect that. If you don’t reflect your community, are you prepared to make your video statement like the Starbucks’ CEO?”
In Florida, the numbers already show the trend, he said. The Sunshine State’s workforce is 54% white, 46% minority.
“A team with a member who shares a client’s ethnicity is 152% more likely than another team to understand that member,” said Hardy. “So how many times in your organizations are we failing to connect with people properly just because we are not represented in the manner we need to be?”
Three Steps to Take
To get better connected, Hardy offered these three steps:
Inspect Your People. “Are we reflecting the community at all levels of the organization? Are we creating a seat at the table in the places and spaces where decisions are being made? One person not having the right information could affect your whole organization. So, it might not be enough to have just one video that talks about diversity.”
Hardy encouraged credit unions to survey their own staff. “People might be nervous because they feel it’s not anonymous, so you need to create a safe space,” he advised. “You can have multiple people in the same organization having a completely different experience, and just because yours is comfortable doesn’t mean they are feeling the same thing. So, you might have people who are not as productive as they could be because your culture has been established in a way that keeps them from trying.”
Inspect Your Process.“Look for barriers you have inadvertently created that exclude certain groups of people. At my credit union, we have a very diverse management team. We have gone from 50 to 80 to 142 BPs in ROA. We got the right people in the right places and started to make better decisions for our members. That was the result of inspecting our processes.”
Inspect Your Purpose.“We as credit unions are well-qualified to make a difference in this area. We talk about giving people access to credit, it’s what we were built on, it’s part of our philosophy. Then we should be positioned as a movement to really lead this discussion that inclusion and diversity is a part of what we do.”
No credit union, or any organization, said Hardy, can have external impact if it doesn’t have the right internal process.
“We want to be proactive in getting it right. People in your organizations are more affected by this than you may know,” he said. “Do you have a culture of candor? Can people tell the truth in your credit union or your department?”
Hardy stressed that being diverse does not mean being inclusive. For the latter to occur, a diverse group of people also need to be involved in decision-making.
Discussion during Hardy’s session also turned to credit union boards, which often lack diversity in gender, race and age. Hardy said CU boards are a “whole other discussion.”
But it’s a discussion whose time has come, he said.
“How many women would like to know that a group of men is making all the decisions for women in the credit union?” he asked. “It becomes uncomfortable when a group that may not understand you is making all the decisions for you.”