Compared to other industries, Wall Street has proven itself to be a champion of LGBT (lesbian, gay, bisexual, transgender) equality. Banks have installed innovative and productive workplace programs aimed supporting the LGBT community, while several CEOs have come out publicly to support gay marriage, including Goldman Sachs Chief Executive Lloyd Blankfein.
Still, a divide appears to exist between LGBT employees at financial services companies and their heterosexual colleagues when it comes to the perception of the industry’s culture. In our recent diversity survey, roughly 86% of heterosexual US respondents said they don’t believe sexual orientation discrimination exists at their firm. More than half of LGBT employees believe it does.
Admittedly, the sample size is very small. Just 21 of the 608 US survey takers who responded to the question said they were LGBT, nine of whom claimed that sexual orientation discrimination exists within their firm. Another 53 people said they’d prefer not to identify their sexual orientation, of which more than one quarter (28%) acknowledged that they’ve seen signs of LGBT discrimination at work.
While it’s difficult to make a definitive assessment from the relatively small sample size, Todd Sears, founder of Out on the Street, an LGBT leadership organization for Wall Street, said his firm’s studies have produced similar figures.
One of the problems, Sears says, is that a large percentage of employees (41%) remain in the closet, even if they are open about their sexual orientation in their personal life. Closeted workers are three times as likely to report experiences of discrimination, according to their findings. They are also three times as likely to say their firm is anti gay.
“People who have been in closet a long time, it’s hard to quantify the damage that can do,” Sears said.
From an employer perspective, banks can do several things to make LGBT employees feel more comfortable coming out, which has statistically proven benefits for both the employee and the employer. Closeted LGBTs are nearly three times as likely to leave their companies within three years, according to the most recent Out on the Street study.
The first thing financial services firms must do is to better align their policies and their culture. Banks have many good policies in place – ally programs and domestic partnership agreements to name two – but that doesn’t always translate to an inclusive culture, Sears said.
“It starts with the top. The CEO has to be a visible ally,” Sears said. And other senior members of organizations need to come out as allies, just as LGBT employees need to come out as lesbian or gay. “If they don’t, employees don’t know where they stand.” So even if there is no overt discrimination, employees may not feel comfortable.
Coming out as an ally creates what Sears calls a “positive halo effect” that touches all minorities on Wall Street, not just LGBT employees. “When a straight, white male manager becomes an ally, all minorities become engaged,” he said.
Finally, senior managers must be more active in their sponsorship and support of LBGT employees, beyond just putting an ally flag on their desk — an initiative several banks have undertaken to show support for LGBT equality.
“In a client situation, if a colleague says, ‘that is so gay’ – something that is still said often – imagine the effect it would have if a manager asked, ‘what does that mean?’ or ‘why are you using that term?’” Sears said.
Too rarely do stakeholders use their political capital to benefit minorities, he said.
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