How to Move the Needle with DE&I in the Finance Sector

Almost two years after the death of George Floyd spurred social justice and systemic racism concerns to the forefront of American corporate discourse, business leaders continue to drive progress within their spheres of influence, with diversity, equity and inclusion initiatives.

This GrowthTV episode features three such leaders: Deborah Gallegos, Managing Director at Palladium Equity Partners; Marlon Nichols, Managing General Partner at MaC Venture Capital; and Dario de Martino, Partner at Allen & Overy.

The panelists offer their observations of how the corporate community has responded in the wake of Floyd’s killing, sound off on some of the barriers to implementing  DE&I initiatives and offer practical advice for others in the corporate finance space pursuing similar goals.

Below, learn more about the latest DE&I initiatives within Palladium Equity Partners, MaC Venture Capital, and Allen & Overy.

Palladium Equity Partners

As one of the oldest minority-owned middle market buyout firms in the U.S., “doing the right thing” has been a core part of Palladium’s history, mission, and investment strategy since its inception in 1997.

Over three quarters of Palladium’s team is considered a minority and/or female. Going further in terms of inclusion, 70% of the Firm’s partners are considered minority and/or female. Additionally, 1 of every 2 portfolio company board members is either a minority and/or female, which we believe is best in class within the industry.

Palladium has also developed and maintained specific metrics that are relatively simple and well suited broadly to deliver on the DE&I objectives of the Firm. Specifically, Palladium has adapted a commonly known economic measure of inequality across countries – the Gini coefficient – to our portfolio companies to ascertain income disparity within its labor force. We call this measure the Palladium X Factor (“PxF”) and we aim to have a 20% year over year improvement of such factor (i.e. a decrease of the income gap) in order to create returns for the employees and communities where our portfolio companies operate.

DE&I is a core value that is established at and communicated from the top levels of the Firm, with frequent discussions at the senior level around how to increase the proportion of female and diverse candidates at the Firm, particularly in investment roles. To this end, Palladium has long-standing relationships with organizations that promote diversity, including TOIGO and SEO; through these and other partnerships with recruiting firms, the Firm actively requires that applicant pools include minority and female applicants.

MaC Venture Capital

Marlon Nichols is proud to work with the team at MaC Venture Capital to invest in visionary female, black and Hispanic founders building the future the world wants to see. A champion for underrepresented talent, he had long seen the need to invest in diversity, with the mission to focus on fixing the lack of access to capital facing black and women-owned businesses. Marlon and MaC’s most recent fund’s portfolio consists of 69 percent Black, Hispanic and female founders and he has additionally helped over 100 startups grow beyond seed-stage.

Diversity, equity, and inclusion is a massive passion and commitment for Marlon. Aside from MaC, Marlon is a Kauffman Fellow who also serves on the Board of Directors working to diversify the classes and cohorts for the broader venture capital community. Marlon also serves as an advisory board member for Launch with GS, Goldman Sachs’ $1 billion investment strategy grounded in the data-driven thesis that diverse teams drive strong returns.

Another initiative Marlon takes part in is the Black Venture Capital Consortium, where he takes summer interns from HBCUs and trains them for future careers in venture capital. Additionally, he is on PledgeLA’s advisory board, with the mission to diversify VC and technology startups in the Los Angeles area. Marlon’s unique eye for global and cultural trends, along with shifts in consumer behavior, has helped him uplift and accelerate female, black and Hispanic entrepreneurs and companies that are on the verge of their breakthrough moment.

Allen & Overy

At Allen & Overy, all of our work is underpinned by a set of guiding principles based on impact, accountability, and openness. Our Global Board drives the DE&I program forward across the firm, working closely with our dedicated DE&I team who devise and implement our global DE&I strategy. In addition, we have Regional DE&I partners who sponsor and support these strategies across our regions.

We seek to influence and collaborate to drive change. We look beyond A&O with our focus on diversity — working with our clients, the legal sector, and a number of other external organizations — to bring about change. Our clients demand diversity. And we demand it of ourselves. We can only deliver the best and most effective solutions and service by having a team comprised of the best and most effective people. Powered by the differences that each of them brings.

We understand that collaboration can accelerate commitment and progress. This includes supporting industry initiatives and alliances. In the U.S. alone we sponsor and underwrite various organizations, in the last three years we have led innovative initiatives and programs such as: partner-led discussions between our race and ethnicity affinity groups on the rise of racism and hate crimes during the pandemic, allyship and intersectionality training, implicit bias training for all HR staff and interviewers for job candidates; also in the summer of 2020 our U.S. Diversity committee launched the ‘Task Force on Racial Inequity & Inequality’, to guide the firm’s response to the Black Lives Matter movement.