At Bank of America Corp., certain internal programmes that used to focus on women and minorities have been broadened to include everyone.

And at Bank of New York Mellon Corp., executives are being urged to reconsider hard metrics for workforce diversity. Lose them, lawyers have advised.

This is what diversity, equity and inclusion (DEI) looks like on Wall Street today: anxious, fraught – and changing fast.

From C-suites down, American finance is quietly reassessing its promises to level the playing field. The growing conservative assault on DEI, coupled with pockets of resentment among White employees, have executives moving to head off accusations of reverse discrimination. It’s not just Wall Street. In recent weeks, Zoom Video Communications Inc. cut its internal DEI team amid broader layoffs and Tesla Inc. removed language about minority workers from a regulatory filing. 

The seemingly small changes — lawyerly tweaks, executives call them — are starting to add up to something big: the end of a watershed era for diversity in the US workplace, and the start of a new, uncertain one.

“We’re past the peak,” said Subha Barry, former head of diversity at Merrill Lynch.

Wall Street has long been skewed white and male. Even an inkling that banks are retreating from DEI has some women and minorities questioning how real promises of change were in the first place.

Publicly, executives insist they’re as dedicated as ever. Goldman Sachs and other major US banks say they remain committed to attracting and promoting people from a range of backgrounds. Privately, however, many acknowledge that the high-profile campaign against DEI— amplified by billionaires including Elon Musk and Bill Ackman — threatens to set back what progress Wall Street has made.

Recruitment programmes aimed at women and minorities — a key tool for recruiting diverse talent — are being reworked. In-house affinity groups, specific workforce targets and even boardroom diversity initiatives are all up for review, executives, consultants and lawyers say. 

It’s a remarkable turn. Less than four years ago, amid lofty talk of a “racial reckoning” and an “inflection point”, America’s CEOs were vowing to embrace inclusive hiring, promote minorities and narrow the gender pay gap.

Now, after the US Supreme Court rejected affirmative action at the nation’s colleges, the legal assault on corporate diversity initiatives is gathering steam. The right has villainised DEI from Disney World to Harvard University as an engine of left-wing indoctrination and the banks don’t want to become a target for lawsuits claiming reverse discrimination.

Wall Street has made some progress toward diversity over the years. Still, the numbers are sobering. At Goldman Sachs, 3.7% of senior executives in the US are black, according to the bank’s most recent report. That figure is about 5% at JPMorgan Chase & Co., and it’s 8.7% inside Citigroup Inc. By comparison, black people are about 14% of the overall US population. And yet those statistics represent hard-won improvement for the banks over past years: The percentage of senior black executives and managers at all three fell from 2012 to 2016.

Bankers and lawyers contend they have little choice but to reframe or pause new diversity initiatives and to get ahead of the blowback and potential litigation.

“People are all over the place,” said Valerie Irick Rainford, who oversaw programmes to promote Black leaders at JPMorgan Chase before leaving the bank in 2019.

Bank of New York, for instance, is reconsidering its decision to tie executive compensation to progress on diversity, according to people familiar with the matter. The lender has also changed the language it uses to describe its diversity and inclusion initiatives in recent months, eliminating references to “specific targets” around diversity and inclusion.

Bank of America has tweaked some DEI programmes and the way it talks about them, according to people familiar with the changes. The lender has considered ending some of its mentorship programs because they had achieved their goals and may no longer be needed, one of the people said.

JPMorgan’s summer fellowships for black undergraduate sophomores is now open to all sophomore students “regardless of background.”

At Goldman Sachs, lawyers have advised senior executives to remove references to race and gender in college recruitment programs, according to people familiar with the matter. They’ve also warned against hosting exclusive events for specific groups, such as women and people of colour.

Spokespeople for BNY Mellon, JPMorgan and Goldman Sachs said the lenders remain committed to an inclusive workplace with people from diverse backgrounds. A spokesperson for Bank of America said the firm consistently evaluates its initiatives but “has not eliminated any bank-sponsored D&I sponsorship programmes”.

One influential Wall Street banker said he’s observed that the sway executives in charge of diversity recruitment used to have with decision makers has diminished. Asking for anonymity to describe the recent changes, he said that colleagues who’d been willing in recent years to be open to diverse recruitment are reverting back to the way they were before George Floyd’s murder.

US corporations are certainly changing the way they speak about diversity initiatives. Citizens Financial Group Inc.’s latest annual regulatory filing no longer refers to a goal of having women and people of colour make up at least 50% of the candidates for mid- and senior-level roles, Bloomberg News reported last week. The revision was among more than a dozen diversity-related edits in annual filings at large US companies this year.

Rainford, who consults on diversity for companies including financial firms, said one client told her recently that it was wondering whether it needs to pause its diversity programmes altogether. “If you didn’t have the conviction in the first place, it’s easy to say, ‘We’re not doing that anymore,’” she said. For now, her client is sticking with its diversity programs, she added.

Trouble keeps coming. DEI experts are keeping a close eye on a legal drama now unfolding in Miami, where a case has become emblematic of the growing backlash from the right.

The Fearless Fund, which makes early investments in companies led by women of colour, recently asked a federal appeals court to protect a contest it runs for $20,000 grants for businesses majority-owned by Black women. The fund was sued last year by American Alliance for Equal Rights, founded by Edward Blum, the conservative activist behind the Supreme Court case that ended affirmative action in college admissions in June. They claim the fund’s grant contest is racially discriminatory. The outcome could affect how companies steer funding toward minority-owned startups and businesses.

Meanwhile, Stephen Miller, the architect of anti-immigration policies under former President Donald Trump, has emerged as a key figure in preparing a hardline conservative agenda in the event Trump returns to the White House.

Miller is bent on eradicating diversity initiatives in business. His advocacy group, America First Legal, has accused dozens of companies of discriminating against white men.

“We’re at an interesting inflection point,” said Ana Duarte McCarthy, former chief diversity officer at Citigroup, whose CEO, Jane Fraser, is the only woman ever to lead a major US bank.

Yes, many financial companies are pausing and re-examining diversity initiatives, said Duarte McCarthy, who now works as an industry consultant. But most are pressing on, and virtually no one has signalled a full-blown retreat.

“We’re not suggesting that things stop because there’s this fear factor,” she said. “But rather, take a look.”

Still, conservative activists and politicians aren’t the only ones challenging DEI. So are some Wall Street workers, albeit far more quietly.

The pushback inside the industry is real, according to Barry, the former Merrill executive, who now leads DEI advisory firm Seramount. She’s had White women ask her what opportunities their sons will have if Wall Street focuses solely on promoting underrepresented groups.

“Are they doing it publicly? Vocally? Of course not,” Barry said. “But they’re doing it. And when they do it, you have to listen.”