As the world watches to see how talk about diversity, equity, and inclusion (DE&I) translates into action, corporate America faces a test of character. Recent data from HireVue shows that while 100% of hiring leaders consider DE&I “extremely relevant” or “very relevant,” only 33% rank taking action on it a top priority.1 So how can leaders take the crucial step from words of solidarity to measurable outcomes?
The stakes are high in this new phase of confronting inequity and discrimination. While companies need to tackle DE&I challenges on myriad fronts within their organizations, many may not realize there’s already a tangible way to support disenfranchised populations: workplace financial wellness benefits.
An Unsung Strategy
Like any major challenge, there is no silver bullet. Yet financial wellness programs may be one of the most underutilized tools in terms of moving the needle on diversity and inclusion goals. Companies may actively promote both financial wellness and DE&I, but interestingly, they often overlook the potential harmony between the two.
The most important point for companies to absorb is that financial wellness and DE&I initiatives do more than intersect—they are symbiotic. Although they may not realize it, your HR team and DE&I leaders are working on parallel tracks, often toward some of the same goals. The issues HR professionals are working to solve through financial wellness programs play a significant role in the widespread inequalities that DE&I leaders are attempting to tackle with their own initiatives. For example:
- Women, black, Latinx, LGBTQ+, and populations with disabilities are more likely than men and white populations to say they don’t have enough money to take care of life’s unexpected expenses, are unhappy about their current level of savings, and view getting out of debt as their highest priority.2
- Women and minorities also disproportionately carry more student debt compared with their white, male peers and are more likely to face income inequality.3,4 Women carry roughly two-thirds of the nearly $1.6 trillion of student debt owed in the United States, with women of color carrying a heavier debt burden on average.5,6 Also, student debt can compound racial economic inequalities in financial areas like homeownership, with a disproportionate impact on people of color.7
- Only 85 women are promoted to manager for every 100 men—a ratio that falls to 58 for black women and 71 for Latinas.8
- A recent Morgan Stanley report found that just 41% of women participate in equity compensation plans compared with 52% of men.9
These realities make connecting HR and DE&I initiatives through financial wellness a win-win for everyone. Here are three steps any company can take.
Step 1: Make the Connection
The first step could be the easiest: Simply take the time to recognize that financial wellness and DE&I go together. Coming out of 2020, most companies want to improve employee well-being, as well as diversity and inclusion.11 Financial wellness can help check all the boxes.
HR professionals thinking about program benefits can start by connecting with DE&I colleagues to learn about their goals and projects and discuss any areas where their interests overlap. Similarly, DE&I professionals can reach out to HR colleagues to learn more about existing workplace benefits programs, new goals, and new financial wellness initiatives.
By widening their circles and shifting their mindset to see financial wellness as a possible DE&I tool, companies can foster stronger internal collaboration and make sure both HR and DE&I voices find the right seat at the table.
Step 2: Reframe Your Data
Once HR and DE&I professionals begin to collaborate on common goals, the pieces will begin to come together—but any decisions need to be built on solid data.
If HR and DE&I have been working in silos, it can take a little work to get on the same page. For example, while DE&I leaders often speak to diversity groups, HR usually conducts companywide surveys to get at universal themes that can miss the perspective of specific populations.
Make sure the data is a true and accurate representation of the population. What do different employee groups need from their workplace benefits? Surveys must be tailored and inclusive to help identify specific needs. Meet your people where they are—employee resource groups (ERGs), networking groups, etc.—and talk to them about equity and benefits. By working in tandem to gather data, HR and DE&I colleagues can better understand how to design programs that fit.
Step 3: Work in Tandem
Next, HR and DE&I need to align on goals. Just like few of us hit the road without mapping the route, HR decision-makers need to know the program’s ultimate destination and the best way to get there.
How will you bring equity and inclusion to the top goals of recruiting, diversity, and well-being?8 Is your current financial wellness program accessible so people feel the programs and resources speak to their needs?
No Such Thing as One Size Fits All
Once you see the connection between financial wellness and DE&I, so many doors open wide. It’s thrilling when HR and DE&I colleagues discover how their functions can align to help address shared goals, and that combined firepower can mean getting further quicker.
In fact, the percentage of employers offering or actively implementing a financial wellness program rose 77% in 2020—up from 66% in 2018. Almost three-quarters (74%) of companies with more than 10,000 employees are now offering a financial wellness program.11
Gearing financial wellness benefits toward diverse communities may be one of the biggest steps companies can take to get real about diversity.
Krystal Barker Buissereth is CFA, Managing Director, Head of Financial Wellness at Morgan Stanley at Work.
- HireVue, “Global Trends Report The State of Hiring Experience,” March 2021.
- Salary Finance, “Salary Finance: Inside the Wallet of Working Americans,” 2021.
- Newsweek, “The Truth About Student Debt: 7 Facts No One Is Talking About,” Aug. 8, 2019.
- Pew Research Center, “6 demographic trends shaping the U.S. and the world in 2019,” April 11, 2019.
- American Association of University Women (AAUW), “Deeper in Debt: Women & Student Loans,” accessed June 21, 2021.
- org, “Student Loan Debt by Race,” June 9, 2021.
- S. Department of Housing and Urban Development, “Federal Housing Administration Takes Steps to Remove Barriers to Homeownership for Those with Student Loan Debt | HUD.gov / U.S. Department of Housing and Urban Development (HUD),” June 18, 2021.
- McKinsey & Company and Leanin.Org, “Women in the Workplace 2020,” accessed June 21, 2021.
- Morgan Stanley, “Transparency 2021: Addressing Gaps in Equity Compensation,” March 2021.
- Gartner, “Gartner Top 3 Priorities for HR Leaders in 2021,” Oct. 23, 2020.
- Employee Benefit Research Institute, “2020 Employee Benefit Research Institute (EBRI) Financial Wellbeing Employer Survey,” Sept. 22, 2020. https://www.ebri.org/docs/default-source/fwrc/sept-2020-symposium/fwrcsym_masterday1.pdf?sfvrsn=f10f3a2f_2
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