Do corporate diversity training programs work? Harvard professor Frank Dobbin said no in a Harvard Business Review article last year, writing that most diversity programs have failed because they alienate managers. Dobbin instead endorsed a voluntary consciousness raising program that includes rank and file staff along with supervisors. One bank is
willing to give the alternative a try. As part of a thirty five and a half million dollar settlement with black financial advisors, Wells Fargo has agreed to take some measures to create a fairer workplace, borrowing some ideas from Dobbin, including focus groups with senior business leaders and black brokers. Will it work here to discuss? That is? Valerie Purdy Greenaway. She's a professor at Columbia University and also the director of the Laboratory of Intergroup Relations and the Social Mind
at Columbia. Valerie MetLife agreed to pay more than thirty two million dollars to settle a racial discrimination employment case this year, and four years ago Mary Lynch set a similar case for a record sixty million dollars. Do these kinds of settlements lead to changes in the diversity of the workforce? That's a great question. In general, they tend not to and the reason why is because there is so much um uh animosity that goes along with the
legal cases. Oftentimes the settlements UM the benefits go directly to the plaintiffs, and it doesn't address the broader cultural systemic issues that have been hurting and derailing people's careers. And in this case, the target where African American financial advisors. But research shows that when there is a settlement like this many many other groups are subtly affected as well, um individuals with disabilities, women in leadership positions, other ethnic groups,
other religious groups. So um and in short, they attends the settlement is a financial corrective, but more is needed. Well, it almost feels like the the traditional way of doing it is something of a compliance model. It's kind of a top down thing that what we're talking about. Well, as Fargo, it seems like it's more bottom up in a way. Is that right? Yes? Absolutely, And Frank's work
is so crystal clear. Compliance models tend not to work. UM. Managers are highly intelligent, highly motivated, and oftentimes they want to do good. UM. Compliance models are inconsistent with what we know about how the brain works. Uh much of bias is unconscious. We're unaware of it, and it's baked
into many of our um corporate practices. So by having a voluntary bottom up approach, you can start a really targeting where the bias might be, having people feel ownership and agency around, you know, trying to make the workplace, culture and leadership UM better. UM you can log roll or enhance the whatever programs are already working, and then you can target unconscious unconscious bias and and work on strategies to mitigate bias. So a bottom up approach is
much more effective than than compliance. Unfortunately, compliance is oftentimes necessary, but it tends not to be effective. Valarie tell us more about these suggested focus groups and how they differ from workshops in diversity training programs. So part of what needs to happen is leaders need to be really comfortable
just being able to talk about identity. In financial institutions, most financial institutions have a color blind approach that they don't really talk about identity and and and because of that, there really is no language event to talk about sponsorship, mentoring, mitigating unconscious bias. When you have focus groups where you just get people who want to you know, um, just
make the workplace better. They're in a room, they have a variety of different identities, experiences, UM, intellectual diversity in there in the room, just talking to each other, um, and not focusing on you know, what are the settlement pieces, but just talking about solutions. This has so many psychological
benefits and sort of humanizes diversity. You can localize problem solving, you can pick things that are going to really accelerate change, and it creates a different psychology of psychology around openness and authenticity and genuineness. Um, that's really needed. Are there metrics fallorie that you know a company like Wells Fargo could use to measure whether this different approaches working. Absolutely, so you know, focus groups do not mean that they
can't be rigorous. You can have randomly assigned focus groups where where within a particular division you would have a group of leaders that would be involved in a focus group, you would have another group of leaders maybe you know, compare compare them to a compliance strategy. You can also use what's called a lag design where you have certain focus groups happening in September and then you have another
set of focus groups happening in November. These kind of strategies integrate the rigorous experimental methods UM, which can tell us what works and why, along with the openness and fluidity of of the focus groups. Valerie, does mentoring fit in somewhere here, absolutely, But not just mentoring. Mentoring is UM sort of telling people, oftentimes members of underrepresented groups, you know large, you know how to make it through
the company. Where it's really at is sponsorship. Sponsorship means who am I pushing without them in the room, without them knowing it, moving around their careers, giving them stretch assignments. This happens oftentimes unconsciously and as a function of homofely. We like to push people that are like us or that remind us who we were a long time ago. That process really drives promotion, and that is an implicit, oftentimes secretive process that people don't even know that they're
engaged in that needs to be brought to light. So not just mentorship, but sponsorship and equitable sponsorship across groups. Valerie, would you expect that you're going to see more settlements in discrimination cases, you know, get companies involved with this sort of bottom up approach and focus groups approach. It's it's hard for me to to predict that. UM, I believe that companies are motivated to find solutions about what works.
I mean, millennials are looking for scores. They want to know if this is a place where where they where they fit in, and diversity and inclusion is a central part of what millennials are looking for. So having strategies that move beyond compliance, that engage leaders, that are bottom up,
that include psychology and behavioral analysis, they work. So um My, My hope and my expectation is that more and more companies would be um moving towards that, and also that that judges would be recommending these strategies because they're consistent with what we know about psychology and science and how the brain works. Thank you so much, it's been a fascinating discussion. That's Valerie pretty Greenaway. She is a professor
at Columbia University. That's it for this edition of Bloomberg Law. Will be back Monday at one pm Wall Street time. Please join us then, thanks to our producer David Sacherman and our technical director Chris try Comey. Coming up next Bloomberg Markets with guest host Lisa Abramowitz. Lisa, give us one idea of a thing you're gonna be talking about. We'll be talking about the new path of Irma. That's something that's on all our minds. Thanks so much for
joining us. I'm June Brasso. This is Bloomberg