Edward Jones Sets 2025 Diversity Targets for Advisors, Executive Ranks
Edward Jones this week unveiled specific targets for diversity in its broker sales force and leadership ranks, including an aim to almost double by 2025 the percentage of “the people of color” among its brokers, the company said.
The St. Louis-based brokerage’s announcement came three months after it reached a proposed $34 million settlement of a class action race discrimination lawsuit filed by Black brokers and trainees.
Edward Jones, the largest U.S. brokerage firm by its more than 19,000 brokers, announced a 2025 target of 15% representation of “people of color” among its brokers, up from 8% currently, and 30% representation of women, up from 21% currently.
Among its home office leaders, Edward Jones is targeting 20% representation of “people of color,” up from 9%, and 40% women, up from 30% by 2025.
“The scary part—and I’ll just be perfectly open—about putting those numbers out there, is what if we don’t quite make them,” the brokerage’s CEO Penny Pennington, told an online audience Thursday during the Securities Industry and Financial Markets Association’s Diversity, Equity and Inclusion Leadership Summit 2021 Program.
“It doesn’t feel particularly great right now to be saying over and over again we’re not where we want to be,” she said.
If successful, Edward Jones, one of the last large firms operated as a partnership, will have 20% representation by “people of color” and gender parity across its cadre of general partners, Pennington said. She did not say how many of the firm’s 586 general partners, including regional leaders and higher on the corporate ladder, are currently diverse.
Edward Jones has for years been one of the few major brokerage firms to publicly report its diversity statistics as the industry has struggled to boost the ranks of women and minorities in its ranks.
At Merrill Lynch Wealth Management, which began disclosing diversity metrics for its broker roster last year, 21% of its roughly 17,500 brokers and branch-based advisors were women and almost 14% were Black or Latino.
UBS Wealth Management USA also last year issued 2025 diversity targets in the Americas business, which also includes around 6,500 advisors in Latin America and Canada, and said it is looking for 25% female representation and 19% representation of “racial/ethnic minorities” among advisors.
That is up from 15.3% of women advisors currently and 10.4% racial/ethnic minorities, according to the 2020 report.
In filings last month, Edward Jones warned that its aggressive growth rate for broker headcount may slow as it revamps its training program to focus on support and retention, including for diverse candidates.
The changes came after Edward Jones in March announced it had agreed to settle the racial discrimination class action lawsuit that had been filed in 2018 on behalf of current and former Black financial advisors who accused the firm of bias in its training and account distribution practices.
As part of the settlement, Edward Jones agreed to revise its policies for recouping training costs and form an advisory council comprising a “diverse cross-section” of brokers at the firm who will consult with senior executives on initiatives to increase diversity and representation of African American advisors.
On May 4, U.S. District Judge Andrea Wood in Chicago, who presides over the class-action lawsuit, issued preliminary approval of the settlement and scheduled a hearing for July 12, when she will hear any objections to the deal.
There are at least 800 such class members, according to the documents, who could see payments of around $31,000 net of legal fees and court costs.