Canadian society has struggled with racism for quite some time, and the financial services industry is no exception. Unions, governments, and financial services industry stakeholders and commentators in Canada have all recently reported instances of racism in the workplace. Both overt acts of discrimination and institutionalized obstacles to banking services for people of color are to blame. Unfortunately, people who have been historically underserved or marginalized in Canada's banking system still face several barriers to gaining access to the services they need. To better understand how financial inequalities manifest themselves across Canada, this blog post will explore how poverty and racism interact with one another.

Introducing racism in the Canadian financial sector – an overview

Despite its reputation for stability and growth, Canada's financial sector is not immune to the pervasive problems of racism and discrimination plaguing the world. A deeper dive into the issue reveals that people of color may have trouble accessing banking services, stunting their economic growth. Discriminatory lending practices and biased hiring and promotion policies are just two examples of how systemic racism can manifest in the business world. With increasing calls for diversity and inclusion, it's critical that we learn about and work to remedy inequities in the financial sector if we want to create a more just society. This overview seeks to illuminate the nature and magnitude of racism's influence on Canada's financial system, sparking a discussion critical to advancing genuine and lasting reform.

The early history of racism in the banking industry

When we look back at the early history of racism in banking, we see a time when people of color faced pervasive racial discrimination and systemic barriers to financial opportunities. When the United States began transforming into an industrial power in the 19th century, banks were among the most critical institutions in fostering that transformation. However, the benefits of this expansion were not shared evenly; discrimination against African Americans and other minorities in the lending industry limited their access to necessary funding. By making it nearly impossible for minorities to obtain mortgages, segregationist policies like the widely publicized "redlining" practice deepened economic gaps and exacerbated racial disparities in wealth accumulation. Unfortunately, the effects of this early form of financial racism reverberate throughout modern banking systems, significantly impacting the wealth gap and opportunities for minority individuals' economic well-being. For the modern banking industry to succeed in repairing its past mistakes, it must first fully appreciate the far-reaching effects of its previous methods.

Recent cases of discrimination and inequality

Unfortunately, discrimination and inequality have been on the rise recently, unsettling society. Cases of discrimination based on race, gender, and religion, among others, have sparked vigorous discussions and widespread outrage. Discrimination against minorities and police brutality are two examples that have sparked protests and call for change worldwide. Furthermore, there are glaring gaps in pay, access to resources, and decision-making authority between the sexes, all reflecting the deeply rooted cultural and structural barriers in today's society. And if that weren't bad enough, cases of religious discrimination persist in sowing discord where there once was peace. To ensure a peaceful, prosperous, and equitable world for all, governments, civil society, and the international community must take concrete measures to address this pressing problem by fostering inclusivity, promoting diversity, and abolishing all forms of intolerance.

Impact of systemic racism on marginalized communities

Although its effects on minority groups are frequently downplayed or denied, systemic racism impedes economic and social advancement. These communities, primarily composed of people of color, face racial disparities in many areas, such as access to quality education, safe and affordable housing, quality healthcare, and well-paying jobs. The cumulative effect of these injustices is reinforcing poverty cycles, strengthening prejudice, and solidifying social stigma. A further contributing factor to their social marginalization and lack of trust in institutions is the disproportionate effect that law enforcement and judicial decisions have on these groups. One of the most critical steps toward building a more equitable society that values the unique cultural contributions of every member is to recognize and combat the pernicious effects of systemic racism.

The government took steps to address this issue

Governments around the world have been taking the initiative to solve problems that have been plaguing their citizens in recent years. They have tried to address issues ranging from economic expansion to environmental security by enacting broad policies and developing specific initiatives. However, the success of these endeavors depends on the combined efforts of many different groups, including the government, nonprofits, businesses of the local community, and those from around the world. In addition, governments are increasingly using technology to streamline and optimize their operations, encouraging a spirit of innovation and openness. Thus, people worldwide are reaping the rewards of their leaders' efforts, which has resulted in improved living standards and a more secure future.

Ways to eliminate racism from the finance sector going forward

Promoting a more inclusive and equitable society requires, among other things, the successful elimination of racism in the financial sector. Moving forward, businesses should try to eliminate discriminatory policies and practices and increase diversity at all levels of the organization. This can be accomplished in several ways, such as by raising people's consciousness about the pervasiveness and destructiveness of racism in the workplace, by creating and enforcing solid anti-discrimination policies, by actively recruiting and retaining people from diverse backgrounds, and by regularly reviewing and evaluating the results of these initiatives. Essential measures to eliminate racism's pervasive influence in the financial sector include holding managers and executives accountable for creating and maintaining inclusive and productive workplaces and fostering candid discussions and active participation from staff. The financial industry can help pave the way for a more equitable and welcoming future if it gets behind these initiatives.

The issue of systemic racism in Canada's financial sector is deeply troubling and has far-reaching consequences for all Canadians, particularly for those already at a disadvantage. Even though the government has taken measures to investigate and lessen the effects of discrimination, much more needs to be done. Policy shifts toward greater inclusivity are required at all levels of the financial sector if racism is to be eradicated for good. Organizations need to be incentivized to make diversity, equity, inclusion, and anti-racism initiatives top priorities to address structural inequality directly and strategically. When this occurs, Canadians from all walks of life can take advantage of improved financial accessibility, opportunity, and equity.

Image courtesy of Alex Shutin @fiveamstories