DES MOINES, Iowa -- George Nichols remembers being at a trade association event in the mid-1990s when a insurance company CEO asked him why aren't there more Blacks in industry leadership positions.
"I started laughing," he said. "I mean, I'm like laughing hysterically."
The other CEOs at the table were perplexed, said Nichols, president and CEO of The American College of Financial Services. Nichols delivered a special address Tuesday at the Global Insurance Symposium.
"You know what they said to me?" Nichols recounted. "'Well, what the hell is so funny, George?' And I was like, 'Y'all are the ones hiring the people. Why won't you tell me why there aren't more Blacks as CEOs in insurance?' Why you gonna ask me?"
Nichols told the story to make his main takeaway point: if you're in a leadership position, you need to look in the mirror.
"Here's what I tell CEOs when they ask me: 'First of all, what have you done? What does your organization look like today? You should go and assess your organization. Because that's where we've got to start,'" Nichols said.
The insurance industry charged into the diversity debate following the death of of George Floyd on May 25, 2020, and the ensuing Black Lives Matter protests. The industry sees the Black and Hispanic markets as underserved and potential growth areas.
Nichols was the first Black person to be the Kentucky insurance commissioner. He was the first Black president of the National Association of Insurance Commissioners. He was the first Black member on the executive management committee of the New York Life Insurance Co. And he is the first Black president of The American College.
"And I'm not impressed," Nichols said. "Because I didn't enjoy any of those being the first. And in many occasions, I do not enjoy being the only."
Nichols offered five additional takeaways for financial services companies looking to be more diverse:
White males must buy in to the program. Unless the white men who are doing the bulk of the hiring are on board with the effort, it will fail, Nichols said. So it is best to go in peace, as opposed to going in with pitchforks.
"If you want to walk in and say 'They're the devil. They're the problem.' Then guess what? They are the devil, and they are the problem," Nichols said. "Why would I want to help you if that's what you're calling me?"
Don't do tokenism. In the rush to be diverse and to curry favor with the Obama administration, a lot of companies rushed to add minorities during those years, Nichols said. But they didn't factor in competency.
"Don't be focused on color when you know you need competency," he warned. "Don't just hire anybody. Because if you do that you're setting yourself up for failure. You're setting them up for failure."
Make sure your diversity hires are a cultural fit. If a significant diversity hire doesn't fit the culture of your organization, then you've traded one problem for another, Nichols said.
Have a plan to grow your company. Adding more color, and women, is a great idea on paper, Nichols noted, but where are they going? And who are they replacing?
"If you don't grow, and you're not creating new jobs, for you to create new diverse people means that there's people going out the door," he explained. "Now maybe you're like the old GE that got rid of their their worst 10%. Or maybe you're sending a message to some of your people that eventually I'm going to run you out. Well, if you're doing that you just created another conflict."
Prepare your organization for change management. Many companies are doing just fine and growing strong each year. It can be a difficult hurdle to convince C-suite executives that the best way forward is through diversity, Nichols said.
"You have to help them work through that," he said. "Because leadership requires that I accept an organization and it's better off tomorrow than it was when I got it. And if I know what is down the road for my organization, that I should be putting things in place today to make sure that we continue to be successful."
InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected] Follow him on Twitter @INNJohnH.
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