Helping Black Canadians break into financial services

CAUFP president discusses how systemic barriers hold back Black talent, and what the organization is doing about it

Helping Black Canadians break into financial services

“I can’t breathe.”

The sentence infamously spoken by George Floyd as Derek Chauvin’s knee pressed into his neck has taken on a life of its own. Originally a plea for mercy, it has become an expression of protest among members and allies of the Black Lives Matter movement around the world.

Far more than an indictment of police brutality, those three words also reflect the frustration among Black leaders in the wealth space who say systemic barriers are getting in the way of diversity and equity within the industry. A lot of changes need to happen – and one association is working to make sure they do.

“It all began with our founding president, Paget Warner, around 20 years ago,” Meryl Afrika, president of the Canadian Association of Urban Financial Professionals (CAUFP), told Wealth Professional. “At that time, he realized there was not a lot of diversity in the financial-services space, and people needed a place to connect if they wanted to get ahead.”

According to Afrika, the organization was originally set up under the banner of the Urban Financial Services Coalition, which pursues the same mandate in the U.S. But following a realization that Black Canadians faced certain issues that were distinct from their American counterparts, it was rebranded as CAUFP. Its membership today includes 600 professionals working at firms within and outside Bay Street, including Big Six banks and boutique firms in the investment space.

Hurdles as early as high school
Right now, there are no official statistics to show how deep the problem of lack of representation runs within Canada’s financial-services industry. The closest to it might be a recent Bloomberg survey of leadership at Canada’s Big Six banks along with Manulife and Sun Life, which found only one out of 188 top executive and board positions was occupied by a Black person.

This is likely no surprise to Afrika, who described the pervasiveness of challenges that may prevent a Black Canadian from successfully entering the field.

“It starts as early as high school,” she said. “We hear about a lot of guidance counsellors telling our kids to go into social sciences even if they have the grades, the aptitude, and the desire to go into finance or accounting. In most cases, the kids don’t have role models in the family because their parents aren’t in the corporate space, which makes that lack of support at school a huge problem.”

Even after they get into university and pursue a finance- or economics-oriented course, Black students can find it hard to get recruited into the industry. “When people think about recruiting for finance, they typically go to the top-tier institutions like Queens or U of T,” Afrika said. “They’re not going to alternative schools and colleges where a lot of our high-potential students are.”

A bias among recruiters to look for strong, well-rounded CVs may also go against aspiring Black students. Many come from financially distressed families that can’t even co-sign on a loan, so they have to work their way through school. That could put them at a disadvantage compared to other students who have the luxury of becoming student leaders, joining college organizations, or participating in other extracurricular activities.

‘The lines are so blurred’
When Black Canadians are recruited, Afrika said, it’s typically at a frontline job that offers low compensation. Some people advance but get stuck at the senior managing director level, and even fewer manage to reach the VP level or higher.

“One question I ask is whether companies are reviewing their pay scales to ensure Black and other racialized employees are paid on par with their White peers,” she said. “If you get less pay for the same work, it’s going to be harder for you to invest in an MBA, an MFDA license, or all these other things that you need as you aim for higher rungs on the ladder.”

Afrika also cited the need for HR and other executives to focus on mentorship and sponsorship of Black talent, particularly high performers who may not be able to leverage their skills and fully contribute to the organization without much-needed support. She further recommends that organizations make their recruitment and internal promotion processes transparent to ensure that decisions are being made fairly and equitably.

“We know that when a Black person doesn’t get picked or is overlooked for a promotion, it’s not necessarily racist,” she said. “But some of it may be due to an unconscious bias or prejudice as well. The lines are so blurred that it’s hard to figure out where the issue of racism starts and ends.”

Chipping away at the barriers
CAUFP has been working to chip away at these issues through continuous engagement. One keystone program is its annual youth summit – the next one is scheduled in September – where corporate partners can connect and hire some of the top Black students in Canada as analysts, interns, and associates. It has also hosted similar events connecting firms with candidates for mid-level and higher-level executive positions.

“A lot of the initiatives we do involve in-person events, but those plans have been affected because of COVID-19,” Afrika said. “We’re still seeing interest from corporate partners to continue their engagement, so it’s just a matter of figuring out how to move things online. We’re also working to keep up engagement even as companies pause hiring because of the pandemic.”

From a dimension of industry support, things seem to be moving in the right direction. The new Black Opportunity Fund, which aims to invest in Black-controlled companies and organizations in Canada, is reportedly planning to form partnerships with other groups including CAUFP. Manulife has also committed to supporting CAUFP, among other organizations, as part of a two-year plan to promote diversity, equity, and inclusion among its ranks as well as the communities it serves.

In a June 8 Bloomberg interview, Sun Life CEO Dean Connor promised the firm would redouble its efforts to improve racial diversity at the top, and top executives at the Big Six have acknowledged their need to do better.

“We’ve gotten a lot of calls,” Afrika said. “I think there’s a lot genuine interest, and companies are realizing that they need to do a lot more than what they’ve been doing. Our hope is that as we build these relationships, they will be impactful long-term for all our stakeholders.”


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