Marilyn Booker, who served as Morgan Stanley’s head of diversity from 1994 to 2010, has filed a lawsuit against her former employer alleging race discrimination and retaliation (Booker v. Morgan Stanley & Co. LLC, et al, No. 1:20-cv-02662 (E.D. N.Y. June 16, 2020)). "Rather than seriously examine its own role in perpetuating inequalities in hiring, pay and promotion, and in fostering toxic workplace cultures and consumer discrimination, Morgan Stanley has instead repeatedly stopped short of any meaningful major overhauls during prior opportunities for change," the lawsuit said.
After 2010, according to multiple media reports, Booker moved into the wealth management division of the firm where she was the only Black female managing director in the company’s New York City headquarters, until she was fired this past December after 26 years of service. She was told that the position was being eliminated. In the suit, she alleges her budget for diversity initiatives was cut multiple times. Booker claims she "raised her voice about the irrefutable and appalling patterns she saw regarding the hiring, retention and lack of advancement of Black employees" and that she consistently tried to "address the systemic racial discrimination rampant at the Firm." Booker alleges that this ultimately led to her dismissal.
Booker is filing a charge of discrimination with the U.S. Equal Employment Opportunity Commission in addition to her proposed class-action lawsuit "on behalf of similarly situated Black female employees," according to the court documents. The suit claims the "mass exodus" of Black senior leaders coincides with the tenure of current Morgan Stanley CEO James Gorman and that the company made no efforts to retain Black managing directors. "We strongly reject the allegations made in this claim and intend to vigorously defend ourselves in the appropriate forum," a Morgan Stanley spokesperson told The Wall Street Journal.
This is not the first time a head of diversity has been at odds with organization leadership. Recently, Liberty University’s director of diversity retention was one of "at least" four black staff members and faculty to resign, according to The New York Times, after university president Jerry Falwell Jr. posted an insensitive remark and photo on social media. In August of 2019, the University of Iowa’s head of diversity resigned after just seven weeks on the job.
While many major employers are wrestling with the structures that have led to inequality and lack of representation at all levels, banks are among the biggest culprits when it comes to homogeneity in their workforces. In 2019, the U.S. House Committee on Financial Services requested data from the largest banks in the country, finding zero female or minority CEOs, and less than 25% of senior leadership is composed of women and/or minorities. U.S. lawmakers have recognized this issue and publicly reprimanded banks for it.
Many major U.S. financial institutions are or have been involved in discrimination lawsuits. In October 2019, Bank of America and Goldman Sachs paid nearly $15 million combined to settle separate U.S. Department of Labor discrimination charges. In February, J.P. Morgan Chase was on the receiving end of a class-action lawsuit alleging that it placed Black personal bankers in lower-income branches and limited their transfer and promotion opportunities.
In order to make tangible progress toward diversity and inclusion, organizations need to evaluate all aspects of their HR practices, from sourcing and hiring to performance management, development and promotion, for potential biases. Ultimately, all employees want to be supported in their workplace; the first step toward making this a reality for Black employees is to reach out and listen, according to multiple experts.