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Prudential Sees Racial Equity as a Moral, Economic and Business Imperative

This piece was developed with guidance and input from the Living CitiesNarrative Change Working Group, a collective impact consortium composed of foundations, financial institutions and key partners working to harness market forces for economic inclusion by shifting corporate narratives about racial equity.

The racial reckoning that followed the murder of George Floyd got the attention of major corporations across America. It was clear that consumers pay attention to how businesses confront racism, and hundreds of companies responded with statements supporting racial equity. It became clear that diversity, equity and inclusion (DEI) is no longer just the right thing to do – it is now also a business imperative.

Some companies came to that realization earlier. Prudential Financial, Inc., acknowledges that it is still on a racial equity journey, but it committed to increasing Diversity & Inclusion (D&I) several years ago. Vice President of Social Responsibility and Partnerships at Prudential and President of the Prudential Foundation Shané Harris explains that this shift was spurred by a purpose-driven brand identity, changing demographics and market competition, not to mention internal leadership and organizing.

A few years ago, Prudential established a new business function called Inclusive Solutions that integrates community-facing teams such as Social Responsibility and Impact Investing with corporate Diversity & Inclusion and employee engagement teams. The department, led by Lata Reddy, senior vice president at Prudential and chair of the Prudential Foundation, focuses on helping the company address societal challenges while also advancing commercial objectives through the lens of inclusive growth. It includes working intentionally with Prudential business leaders to come up with new approaches that address the emerging needs of increasingly diverse consumers, helping business leaders gain insights to reaching historically underserved communities, while evolving Prudential operating models and talent practices to ensure the company is living out its purpose. The organizational design is intended to fully integrate Prudential’s purpose and a culture of inclusion into the company’s business practices.

So as racial tensions have continued boiling up across the country, Prudential was well-positioned to respond in an authentic, meaningful way – and to deepen work it believes is both the right thing to do and the smart thing to do.

As it continues working toward racial equity, Prudential is building systems of accountability into the way it works that will propel the company forward and maintain momentum even when racial justice issues are not in the national spotlight. The company has embraced its purpose of financial security for all, addressing racial equity as a critical aspect of their brand: who it wants to be and how it wants to be known.

As society expects more of brands – as companies acknowledge we have to move to a multi-stakeholder accountability model, not just accountability to our shareholders – this becomes a business priority,” Harris says.

Although Prudential has traditionally provided financial solutions to an affluent customer base, it increasingly wants to reach the middle market. Like any business, Prudential seeks economic growth, but as the United States transforms into a race-plural society – with a majority of people of color by 2045 – Prudential recognizes the need to promote greater diversity, equity and inclusion throughout its business.

“How do you use the core business model to advance commercial goals but also really apply it to addressing complex social issues?” Shané says. “It is a business imperative that we have the right insights and that we are authentically engaging diverse communities.”

At the same time, Prudential has been making changes to help guide both the way it shapes business practices and the way it listens to employees. That includes better leveraging Prudential’s Business Resource Groups (BRG). Business Resource Groups (also known as Employee Resource Groups) are voluntary employee-led affinity groups managed under the auspices of Inclusive Solutions. These groups were established decades ago to intentionally create an inclusive culture that aligns with Prudential’s business strategy, which promotes inclusion and diversity both within the company and across the markets it serves. While Prudential’s BRGs have existed for more than 20 years, it was clear that a rapidly changing external environment and marketplace created a need and opportunity to elevate the work of BRGs to fully realize their potential.

In retrospect, Shané sees the reengagement of BRGs – including the Black Leadership Forum (BLF) – as one of the most instrumental steps Prudential took to create an authentically diverse culture. The BLF represents the company’s Black employees. Roughly 10 percent of the company’s 25,000 U.S.-based workforce is Black, and the BLF is about 1,600 employees strong. The BLF creates a platform for Black employees to talk openly about racial equity and encourage the company’s leadership to find ways to accelerate the development of a Black talent pipeline. BLF and other BRGs within Prudential are also effectively serving the role of “critical friends,” providing pressure from within the organization to constantly strive toward more inclusive culture and business practices, which has led to even greater internal changes in recent years.

All of this was in place before the killing of George Floyd.

“That was a real moment of acceleration for the BLF,” Shané says. “As the co-leader of the BLF, my counterpart and I put out a video within 24 hours of the tragedy, expressing our own personal reflections with genuine vulnerability – talking to the members of the BLF who were already stunned, hurt and weary from the outsized impact COVID-19 was having on Black and Latinx communities.”

But instead of just keeping the video within the BLF, Prudential disseminated it across the company, which elicited about 200 comments from employees. Even though many employees – particularly white employees – were uncomfortable grappling with the larger issue of systemic racism, employees leaned into the discomfort and expressed the kind of solidarity that can be a precursor to authentic behavior change.

“We shared a note with the company’s executive leadership teams and said, ‘This is how our employees are feeling. Take a look at this video. We need to respond,’” Shané says. That ultimately led the company’s CEO, Charles F. Lowrey, to listen deeply to employee input and engage BLF members in what Shané calls a reverse mentoring framework.

As a result, she says, an all-employee event was led by the BLF less than a week later that kicked off a series of conversations across the company.

“There were 106 meetings with senior leaders talking about what it really means to commit to racial equity – and what Prudential needs to do to examine and evolve its own culture,” Shané says.

Prudential also started to reckon with the company’s full history, and recognized that work is needed throughout the company – not just through investments in Newark, NJ, where the company is headquartered.

The fact is that the company’s purpose-driven identity and 50-year commitment to Newark, where a majority of the population are people of color, is real, authentic and important.

As a Black woman raised in Newark, I understand that class doesn’t inoculate anyone from systemic racism,” Shané says.

That perspective helps drive Prudential’s holistic view of advancing racial equity, which includes not only Black staff but also the Newark community.

Prudential made nine commitments at their last shareholder meeting to do more to embed racial equity in the company’s operation and business model going forward. These commitments fall into three categories: first and foremost, growing and nurturing diverse talent, particularly Black and Latinx talent; incorporating racial equity into the business strategy of every line of business; and expanding philanthropic giving and impact investing in the community and through policy to address barriers to racial equity.

“These kinds of changes can create discomfort and be hard for some people to grapple with,” Shané says. “We have to inspire people to move beyond this discomfort and lean into it.”

Since June, a Racial Equity Task Force has brought together representatives from all the company’s business lines to keep racial equity and inclusion top of mind, and to create an accountability measure for leaders to report on progress even as they examine the company’s legacy and the work that still needs to be done. With many decisions being made at the business line level, racial equity is now one of the metrics in the review of new business plans and budget decisions. Plus, there is transparent communication across all employee channels at least every two weeks.

Racial equity issues have always been critically important to address. Now, with much of the American public tuned in, she affirms the company is more committed to finding solutions than ever before.

“Companies have to confront this – they have to respond,” Shané says. “Because that’s what the external environment is demanding and it’s the right thing, and the smart thing, to do.”

This piece was developed with guidance and input from the Living Cities Narrative Change Working Group, a collective impact consortium composed of foundations, financial institutions and key partners working to harness market forces for economic inclusion by shifting corporate narratives about racial equity.

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