Corporate pledges to advance racial equity have been in no shortage over the past two years. Now, assessing how corporate America is following up on these commitments is top of mind for employees, investors, and other key stakeholders as business begins to ask how it can aid in closing the racial wealth gap.
In a survey JUST Capital and SRSS recently conducted, majorities of Americans (73% or more) agreed on the need for companies to implement a range of policies and actions (both inside and outside the workplace) to help achieve racial equity. And majorities also agreed that these actions would have positive long-term financial impact for companies. Our Corporate Racial Equity Tracker assesses how the country’s largest 100 employers are living up to these expectations, and answering questions of progress by disclosing policies and practices across six different dimensions of racial equity.
Disclosures that our Tracker captures include diverse supplier spend, pay equity analysis, and workforce and board demographics, among others. As companies have stepped up, however, many of the largest in the U.S. made multi-year, multi-layered commitments upwards of billions of dollars. These pledges cover a wide range of product, service, and philanthropic offerings including grants, loans, and investments as well as supporting Black entrepreneurs, brands, and businesses.
Given the complexity of the range of actions, we have not yet captured the pledges in our Tracker, but given the size and potential impacts, we wanted to take a look at how companies have been reporting progress against these big-dollar commitments. We prioritized how some of the companies with the largest financial pledges in the Russell 1000 – including JPMorgan Chase, Citi, Target, PayPal, and Bank of America – are reporting progress on commitments ranging from $535 million to $30 billion. All of them are JUST 100 leaders as well. Read on to explore what they’re reporting.
Ranked 4th in its industry and 28th overall
Bank based in New York, New York
In October 2020, JPMorgan Chase committed to spending $30 billion over five years to help to advance racial equity. This effort includes investments in expanding access to affordable housing and homeownership for underserved communities, growing Black- and Latinx-owned businesses through its lending practice and supply chain, and building a more diverse and equitable workforce. In February 2022, JPMorgan reported spending more than $13 billion of this pledge. In its 2021 ESG Report, the company later shared that it has “deployed or committed more than $18 billion” of this $30 billion commitment, including:
- Nearly $5 billion in mortgages refinanced.
- More than $4 billion originated in 12,000 home purchase loans for Black and Latinx households.
- $400 million in Low-Income Housing Tax Credit investments.
- $76 million in affordable housing preservation funds closed.
- Over $300 million financed to Community Development Financial Institutions (CDFIs). and $190 million in incremental financing provided to CDFIs.
- More than $100 million of equity invested in 15 diverse-owned or -led Minority Deposit Institutions (MDIs) and CDFIs.
- $155 million spent with 140 Black and Latinx suppliers.
- $396 million in philanthropic contributions.
Ranked 6th in its industry and 100th overall
Retail company based in Minneapolis, Minnesota
In April 2021, Target committed to spending more than $2 billion with Black-owned businesses through 2025. The company’s commitment spans the products sold in its stores, its suppliers and vendors, and an effort to help grow Black-owned businesses, specifically engaging with Black entrepreneurs through its Forward Founders program. Target later established the Roundel Media Fund as part of this initiative, committing to award more than $25 million in media to diverse-owned and founded brands by the end of 2025 through the company’s media arm, Roundel. In May 2022, Target shared an update on its pledge, reporting:
- 50% increase in investments with Black-owned businesses from 2020.
- More than 100 Black-owned brands offered in stores and online.
- Two classes of Forward Founders program completed, supporting more than 30 Black entrepreneurs.
- Since pledging to spend 5% of its annual media budget with Black-owned media by the end of 2022, the company has since invested four times more with Black-owned media partners and doubled the amount of partners it’s working with since 2020.
Ranked 2nd in its industry and 15th overall
Bank based in New York, New York
In September 2020, Citi announced a three-year, $1.1 billion commitment to help close the racial wealth gap and advance economic mobility. The billion-dollar effort includes investing in homeownership support for people of color and affordable housing by minority developers, procurement opportunities for Black-owned business suppliers, impact investing capital for Black entrepreneurs, MDI growth and revenue generation, and grants to support local organizations addressing racial equity. In November 2021, Citi reported that it already spent $1 billion on these initiatives and that it was on track to exceed its original $1.1 billion goal. In April 2022, Citi shared an update on its efforts, highlighting:
- $44 million invested in 11 MDIs.
- $36 million in affordable housing loan opportunities through MDIs.
- $25 million in equity investments with Black-founded ventures.
- $1.2 billion spent with diverse suppliers, including $432 with Black-owned businesses in 2021.
- $72 million granted to community organizations advancing racial equity.
Bank of America
Ranked 1st in its industry and 5th overall
Bank based in Charlotte, North Carolina
In June 2020, Bank of America announced a $1 billion, four-year commitment to address racial and economic inequality in communities across the country. The initiative focuses on health; jobs, training, and upskilling; small business support; and housing. In March 2021, the company expanded its commitment to $1.25 billion in support over five years with an added focus on addressing racial justice and advocacy for Asian Americans. Bank of America’s 2021 Annual Report shares that it’s deployed $450 million of its $1.25 billion commitment, including:
- $43 million to 22 MDIs and CDFIs.
- More than $300 million to over 100 equity funds to provide capital to diverse entrepreneurs and small business owners.
- $25 million to 21 Historically Black Colleges and Universities (HBCUs), Hispanic-serving institutions and community colleges.
Ranked 1st in its industry and 6th overall
Commercial support services company based in San Jose, California
In June 2020, PayPal announced a $530 million commitment to support Black-owned businesses and address economic inequality for Black and underrepresented communities. The initiative focuses on immediate economic support for Black-owned businesses hardest hit by the pandemic, funding Black and underrepresented minority-owned businesses, and supporting community organizations that are expanding economic opportunity and matching employee gifts to these partners. In December 2020, the company pledged an additional $5 million to support Black-owned businesses affected by the pandemic. PayPal’s 2021 Global Impact Report highlights that it has allocated all of its $535 million commitment, including:
- $15 million granted to nearly 1,400 Black-owned businesses impacted by COVID-19, with 99% of recipients still operating.
- $5 million granted to community organizations to support Black-owned businesses through COVID-19 recovery, with 90% of businesses that reported outcomes staying in business and 73% maintaining or growing their workforce.
- $500 million allocated for high-impact treasury deposits and venture capital fund investments, including $100 million invested in 19 minority-led venture funds and $135 million deposited with financial institutions and management funds that serve communities of color.
- $15 million spent to strengthen internal diversity, equity, and inclusion programs and promote racial equity-related thought leadership and public policy.
It is imperative that companies monitor, track, and publicly report on the progress of their racial equity commitments. With many companies looking to find the most effective ways to contribute, further work by The Black Corporate Directors Conference, Brookings and the Southern Communities Initiative point to intentional efforts like supplier diversity, CDFIs, and HBCU/workforce development, among others, rather than traditional philanthropy.