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Wall Street has not typically been accused of doing too much for women and minority groups. The financial services industry, after all, is one in which more major banks are named after the Morgan family than led by a female chief executive.
So it meant something over the past half-decade or so when the biggest names in finance said, over and over again, that they would pour dollars and effort into lending to, hiring, promoting and working with underserved communities.
And it means something else now, as many of those much-promoted policies and practices are being scrubbed to be sure they don’t wind up in the cross hairs of the Trump administration’s campaign against diversity, equity and inclusion.
The retreat includes white-collar investment banks, consultancies, mutual funds and stock exchanges. The latest was Goldman Sachs, which said on Tuesday that it would drop a quota that forced corporate boards of directors to include women and members of minority groups. Others on Wall Street are curtailing efforts to recruit Black and Latino employees.
One international bank, BNP Paribas, even hit the brakes on programming new events for next month’s International Women’s Day.
This pullback has thus far been less overt than, say, in the technology industry, whose executives have made public displays of their support for President Trump’s anti-diversity initiatives. And some financial firms had started to make changes long before the election — opening programs aimed at minority candidates to all, for example.
The renewed push, though, reflects an acceptance among the financial elite that if it was once good business sense to champion diversity, it is now beneficial to abandon that cause.
“The speed at which everyone is abandoning this work and fleeing this space is pretty amazing,” said Seth Welty, a former investment bank diversity recruiter.
At Citi, employees have peppered Mark Mason, the bank’s chief financial officer and one of the industry’s most senior Black executives, with questions about whether the bank will stick to its D.E.I. promises, he told staff in a closed-door meeting on Thursday, according to two employees present and a transcript reviewed by The New York Times.
Mr. Mason told staff that he had few concrete answers. “The strategies and programs that we have may have to evolve, but I don’t see our core values changing. That’s the first point,” he said.
“The second point is perhaps an obvious one as well: We will have to comply with the law, right?”
Last week, the bank had 93 courses on offer for training employees that were described internally at the bank as diversity related, one of the Citi employees said, asking not to be identified because the person was not permitted to speak publicly. Thirteen included training on combating “unconscious biases,” or the idea that employees may inadvertently discriminate against others, the employee said.
Asked about the offerings, Citi said that count was inaccurate. A spokeswoman said the total was 10 in the United States if the count excluded courses such as those required by law, repeated in multiple languages and some that the bank — after inquiries from The Times — had determined were inaccurately described as diversity-related. Some should have been categorized as “anti-harassment,” and only one is specifically devoted to unconscious bias, the spokeswoman said.
“We continue to actively review the executive orders to understand any impact they may have to our business and will make any required changes,” she wrote in an emailed statement.
A Raging Debate
Financiers were ebullient in the run-up to Mr. Trump’s inauguration, as he chose Wall Street-friendly faces for top jobs and pledged less interference in business.
He has rewarded their hope in some respects — by defanging the Consumer Financial Protection Bureau, for one — but put them on the D.E.I. defensive. The president signed sweeping executive orders rolling back government D.E.I. efforts, and last week the Department of Justice said it would direct its civil rights division to investigate and penalize private-sector D.E.I. activities.
Late last month, 11 Republican state attorneys general wrote to BlackRock, Goldman Sachs, JPMorgan Chase, Bank of America, Citi and Morgan Stanley with a slew of accusations, including that they illegally use racial preferences when hiring, promoting and selecting suppliers.
“Political objectives have,” the attorneys general wrote, “influenced your decision-making at the expense of your statutory and contractual obligations.”
Inside those companies, the threats have triggered alarms.
Take Goldman, which during the six-year tenure of its chief executive, David M. Solomon, has chalked up a D.E.I. record that’s typical of many large companies.
He promised to promote more female partners, ordered public reports that showed the bank employed a low if rising percentage of Black executives (2.7 percent in 2019; 3.8 percent in 2023) and laid down a rule requiring U.S. and European clients to appoint at least two “diverse” board members before Goldman would help file their initial public offerings.
“In the long run, this, I think, is the best advice for companies,” Mr. Solomon said in 2020, echoing frequent pronouncements on Wall Street that more diversity would beget more profits.
Almost immediately after Mr. Trump’s election, however, Goldman’s leadership realized they were risking his ire, setting off fevered internal debate at the bank, three executives involved in the discussions said. That’s less because Mr. Solomon had changed his mind on the merits — he didn’t, two people who spoke to him about it said — but because leaving it in place could make the bank a target for Mr. Trump and activists, the people said.
Beginning in January, the bank first bent its rules, allowing two of its clients to file public offerings without meeting the board requirements, as Mr. Solomon asked the bank’s lawyers to weigh in on whether the company risked a lawsuit for employing gender and racial preferences, one of the people said. Still, some inside Goldman continued to encourage the chief executive to stay the course or to stop enforcing the policy without making a formal change, noting the peril of appearing to genuflect to changing politics.
On Tuesday, Goldman officially ended the program, with a bank spokesman, Tony Fratto, citing “legal developments.”
“We continue to believe that successful boards benefit from diverse backgrounds and perspectives, and we will encourage them to take this approach,” Mr. Fratto said in a statement.
New Rules
The financial world is different from retailers such as Costco, whose customers can quickly choose to shop elsewhere. Many of the conservative activists and social media influencers who have succeeded, for instance, in persuading Tractor Supply to abandon its D.E.I. programs had been turned back for years in attempts to force shareholder votes on the alleged mistreatment of right-leaning political and religious depositors at major banks.
Now, they are getting much of what they want without even a vote.
The day after Mr. Trump’s inauguration, Nasdaq yanked rules that ordered companies listed on the stock exchange to disclose their board-level diversity statistics and provide explanation if they did not have sufficient female or minority representation.
A few days later, Vanguard, the asset manager that owns a piece of virtually every sizable public company on earth, said it would no longer press for boards to ensure “diversity in gender, race and ethnicity.”
A Vanguard spokesman said the change reflected an “evolving regulatory landscape across local markets.” He said in a statement: “We continue to believe that board diversity along multiple dimensions, including skills, experience, perspective and personal characteristics, results in cognitive diversity.”
Some are sticking to their plans. Deutsche Bank’s chief executive, Christian Sewing, said on Jan. 30 that he was “firmly behind” the bank’s D.E.I. program, and his counterpart at the Swiss bank UBS has hit similar notes.
Several major banks, including JPMorgan, the country’s largest lender, continue to operate gigantic investment funds that they say are trained on closing the racial wealth gap. Asked by CNBC after Mr. Trump’s inauguration about pressure from conservative activists, Jamie Dimon, chief executive of JPMorgan, responded, “Bring them on.” But he quickly added, “It does not mean you’re not going to change policies going forward.”
At BNP Paribas, based in Paris, the shift is more immediate. For at least a decade, BNP has taken up the cause of gender parity in banking, a historically male-dominated industry. BNP mandated internally that meetings of four people needed to include at least one woman, and it went to lengths to mark International Women’s Day in March, even promoting that its chief executive was named a “HeForShe” champion by the United Nations for his gender-parity efforts.
Over the past week, however, the bank has ordered a halt to plans to expand festivities focused on women next month at a tennis tournament it sponsors, including revoking invitations to speakers. The bank told some staff that it was loath to attract more attention to its efforts, according to a person briefed on the planning who was not authorized to speak publicly.
Michelle Sprod, a BNP spokeswoman, confirmed the decision not to expand the program or others in other sports. She cited planning and resource limitations. “We’ll do that next year,” she said.
Maureen Farrell contributed reporting.