Dive Brief:
- For the next four years, students from Howard University, Morehouse College and Spelman College will be eligible to receive a full four-year scholarship and career guidance from Morgan Stanley through its HBCU Scholars program, per an Oct. 21 announcement.
- The program will accept 15 new scholars each year and aims to have 60 participants before the first class graduates. It will be open to students in all majors and disciplines. "This effort is a part of Morgan Stanley’s larger mission to create an integrated, holistic and transparent diversity and inclusion strategy both internally and externally," the company press release said.
- Morgan Stanley will spend up to $12 million on the program, which also covers living costs for students and includes career readiness guidance through "virtual and on-site (post-COVID-19) components to complement their on-campus curriculum."
Dive Insight:
Employers have found success offering educational benefits to hourly employees, such as Chipotle, which recently expanded its education benefit to include its first HBCU partner. Many large technology companies such as Microsoft and Google have launched public-facing skill building programs with a diversity component as well. Earlier this month, Google announced a partnership with 20 HBCUs to launch digital skills programs.
What makes Morgan Stanley’s new initiative unique is that it sits somewhere in the middle of being a large-scale, public-facing effort like that of Microsoft or Google and the offerings geared toward engagement and retention for existing employees by companies such as Chipotle or Disney. With the Morgan Stanley program operating at three HBCUs, and noting that this is part of a larger effort to improve company diversity, it may be hoping this will create a pipeline to the company for top-tier Black talent.
It is no secret the financial services industry suffers from a reputation problem when it comes to diversity and inclusion, a problem that was perhaps worsened by Wells Fargo CEO Charles Scharf recently stating that “the unfortunate reality is that there is a very limited pool of black talent to recruit from.”
Many major financial institutions have been on the receiving end of lawsuits alleging discrimination. Earlier this year, the former head of diversity at Morgan Stanley sued the company, accusing its senior leadership of "perpetuating inequalities in hiring, pay and promotion," and "fostering toxic workplace cultures and consumer discrimination." In February, J.P. Morgan Chase was the defendant in a class-action lawsuit alleging that it placed Black personal bankers in lower-income branches and limited their transfer and promotion opportunities.
These lawsuits can be costly for employers. Wells Fargo recently agreed to extend 580 job offers and pay $7.8 million in back wages and interest to settle race and gender discrimination allegations from the U.S. Department of Labor (DOL). Last year, Bank of America and Goldman Sachs paid nearly $15 million combined to settle separate DOL discrimination charges.
