Pride month provides an opportunity to celebrate and champion diversity, as well as a reaffirmation that our efforts to foster a fair and inclusive society should continue all year round. In compliance, these issues have come increasingly to the fore as diversity and inclusion have risen up the social and political agenda, accompanying a drive for such values to be reflected meaningfully in business policy and practice.
Pride Month: The Importance Of Diversity In Compliance
This Pride month, we hear from two financial crime compliance professionals who explain the importance of diversity in compliance and describe how being a part of the LGBTQIA+[1] community has influenced their experience in the industry.
Natasha Vernier (she/her) is the CEO and Co-founder of Cable,[2] an all-in-one financial crime effectiveness testing platform, and previously the Head of Financial Crime at Monzo. She and her wife, Stephanie, have two children and a dog.
Caelum Davies (he/him) is a Financial Crime Prevention Specialist at Nordea,[3] a leading Nordic universal bank, as well as the Founder and Project Manager for Worldwide Online Pride. Originally from Wales, he moved to Finland after studying abroad and loving the Nordic way of living.
Moving Mindsets
For Davies and Vernier, it is essential for businesses and compliance, more specifically, to nurture and support diversity. ‘From a pure business fundamentals perspective, we know it makes sense,’ says Vernier. Indeed, McKinsey research shows that companies in the top quartile for gender diversity on executive teams are 25% more likely to have above-average profitability.[4]
It’s clear that employees who feel safe to present themselves fully and honestly are more likely to be productive, as well as feel committed to their organization.
‘It’s hard to bring your whole, authentic self to work if your workplace isn’t representing you or trying to bring your voice to the table,’ says Davies. ‘If you’re not ‘out,’ even answering the coffee-machine question of “How was your weekend?” can be hard when you’re unable to mention your partner.’ Vernier shares this feeling: ‘I don’t think it’s dramatic to say it changed my life to be able to be completely out at work.’
Within compliance specifically, diversity helps teams to adapt to a changing compliance landscape more successfully. ‘It’s all about interpreting and defining your own risk appetite without any strict guard rails, guides or measures given by regulators,’ says Vernier. ‘If the compliance team is all just one type of person, you’re less likely to understand the nuances of the regulation or have good debate and challenge when setting your risk appetite.’
Cable has implemented key principles in its Operating System to support such diversity,[5] the first of which is ‘Be kind,’ which she feels is key to making people feel included. ‘It creates an environment in which people want to stay and feel like they can offer their opinions.’
She emphasizes that this is not there to stop people from raising issues or disagreeing, however. ‘You can have very different opinions, have very healthy debates, challenge people, and try and move mindsets within the context of being kind. That’s way more likely when people in the room are diverse, and they’re able to say: “Actually, I have a completely different opinion to you, here’s why, and here’s my life experience.”
It’s also important to remember the positive impact on customers of seeing a business ‘walk the talk.’ ‘Customers want businesses to stand up for what is right,’ says Davies. ‘They’re more likely to feel comfortable with us if we make an effort to represent them.’
He also notes how having a diverse team allows businesses to predict and adapt to issues that customers may face. ‘Including gender-diverse voices helps tackle sector-specific issues, such as how to ensure staff and systems recognize a customer’s true gender while needing to process ID documents that only state the gender assigned at birth.’
Facing Barriers
While positive steps have been made in creating more diverse and inclusive workplaces, barriers to such progress remain across the economy. Compliance, as an industry, is no different in having work to do on this front, although in Vernier’s experience, compliance is one of the more diverse areas of finance. ‘I know I have been on multiple panels with other LGBTQIA+ people, and that’s not true of when I’ve just been on banking and finance panels.’
She also recalls how she had felt unable to come out in her previous employment in finance companies. ‘Coming out was the hardest thing I ever did, and certainly, the finance industry does not make it easy.’
‘It would be a lie to say that the world of compliance doesn’t share the same problems as wider society,’ says Davies. ‘I haven’t faced much overt homophobia in my personal or professional lives, but even the idea that one “hasn’t faced much” is too much homophobia already.’ He also notes how many people assume that everyone is straight, reflected in his experiences of people asking questions like whether he moved abroad for a woman.
Such moments, even if well-intentioned, can put non-straight people in the position of having to choose whether to come out to that person or keep quiet. ‘Luckily, most people have reacted positively to the answer “not many gay men move abroad for a woman.”
‘All of us make false assumptions about people – LGBTQIA+ folks included – and we need to take them as a chance to recognize and grow out of our biases,’ he adds.
Is there enough visibility and representation of LGBTQIA+ people in this industry? ‘In short, no,’ says Davies plainly. ‘As long as there are still power imbalances in society, we should always be striving for more visibility.
‘While I am grateful to be asked my views, all too often we only get to hear from queer folks like me – white, gay, cis-gendered,[6] men.’ He adds that currently, in many parts of the world, the transgender[7] community is facing increased impingement on their lives and the medical support they can receive, and how this is reflected in the rise in trans-youth suicide rates.[8] ‘We have a duty to listen to and promote their words.’
As to what more can be done to improve visibility and representation, Vernier explains that she tries to provide what visibility she can, even if it may invite criticism. ‘I happily write about how I’m a gay woman in our blog posts. I expect that a lot of straight people might read that and think, “Why does she always mention that she’s gay? I never write that I’m the straight male co-founder of this business”. And I’m happy to take the brunt of those eye rolls or moans if it means that there are people who read it who think, “Oh my goodness, there’s a female gay founder of a business. I can do that too.”
Getting It Right
Finally, what best practice examples can businesses draw upon to improve their inclusion efforts?
‘In my experience, what you see is what you know,’ says Vernier. ‘When I was growing up, I knew no gay people or couples and didn’t know that that was a legitimate future that I could have, which definitely slowed my coming out. Having more LGBTQIA+ representation on C-suites, on boards, and running companies will show people that they can do that and that they belong in those places.’
In terms of practical steps that can be taken, she suggests that one tangible way to track employee feelings is to carry out regular Belonging and Inclusion Surveys. ‘Many companies run employee net promoter score surveys annually. That’s a good starting point, but you can’t really spot trends or relate the changes in people’s feelings to specific things happening in the business. If you do them quarterly or every two months, you really start to see, “Okay, well, we introduced this new initiative, and suddenly a whole group of people isn’t feeling as included.’
‘At Nordea, we’ve implemented a trans-inclusion policy, providing clear support for transitioning employees, guidance to managers wanting to become better allies, and signposting a range of support platforms,’ explains Davies. He also points to companies that have introduced pronouns on name badges or provided equal parental leave and benefits to rainbow families, even when this is not reflected in local legalization.
For Davies, Employee Resource Groups have a significant role to play. ‘These employee-led communities within a company have always meant the most to me, and I’d encourage all organizations to support their growth. It’s through my local group that we’ve been able to support, promote and influence my bank’s overall diversity and inclusion agenda, making it more inclusive for customers, staff, and society as a whole.’
There is still substantial progress to be made in ensuring everyone, no matter their sexual orientation or gender identity, can feel comfortable in their workplace. However, organizations not only have the power to build an environment of diversity and inclusion but doing so will lead them to a more successful future.
Written by Holly Thomas-Wrightson
This article was first published by the International Compliance Association (ICA), the leading professional body for the global regulatory and financial crime compliance community. For more information on the benefits of becoming an ICA member, including access to the ICA’s complete content library of articles, videos, podcasts, blogs, and e-books, visit: Become an ICA Member – Application Form (int-comp.org)
References:
[1] Lesbian, gay, bisexual, transgender, queer/questioning, intersex, asexual/ally, with plus representing the wide range of other identities
[2] Cable
[4] McKinsey & Company, ‘Diversity wins: How inclusion matters’
[5] Natasha Vernier, ‘The Cable Operating System’, Cable
[6] Someone who identifies with the gender they were assigned at birth. Here Davies is saying that at birth, he was assigned male, and he feels that this gender identity is still true to how he feels.
[7] Someone who does not identify with their assigned birth gender and who may seek to medically and/or socially transition to make their body or the way that they present themselves socially align with their correct gender identity.
[8] Sophie Perry, ‘Nine in ten young trans adults have had suicidal thoughts, worrying study finds’, Pink News