Don't Get Distracted
It’s not every day a financial institution worth $US212 billion suddenly collapses but the fall of California’s Silicon Valley Bank (SVB) on March 10, 2023 set off an alarming chain of bank failures, including New York’s Signature Bank and Switzerland’s Credit Suisse. As bankers and politicians scrambled to stop the bleeding, they looked for the causes and decided to blame...us? Not Breakfast Culture, specifically, but practitioners of diversity, equity and inclusion (DEI) and of ethical investing. In the week after the collapse, various FOX News hosts repeatedly proclaimed that SVB had donated $73 million to Black Lives Matter, which was, of course, not true. Nevertheless, Florida Governor Ron DeSantis spent the week on the channel insisting SVB was “so concerned with DEI and politics…I think that really diverted from them focusing on their core mission.” Home Depot co-founder Bernie Marcus declared, “These banks are badly run because everybody is focused on diversity and all of the woke issues.”
The Wall Street Journal went further, essentially blaming the bank’s tepidly diverse board: “In its proxy statement, SVB notes that besides 91% of their board being independent and 45% women, they also have ‘1 Black,’ ‘1 LGBTQ+’ and ‘2 Veterans.’ I’m not saying 12 white men would have avoided this mess, but the company may have been distracted by diversity demands.” The addition of “I’m not saying” here is certainly a dodge, as the Journal is basically coming right out and saying that non-straight-white-able-bodied-men aren’t qualified for these roles.
“It’s the most ridiculous thing I’ve ever heard in my life,” financial advisor Suze Orman told CNN, “That just shows you their serious lack of economics, of money, and reality.” Investor Danny Moses, featured in the book and film THE BIG SHORT, explained, “It’s just bad risk management. It was complete and utter bad risk management on the part of SVB.” The banks failed to prepare for the sudden spike in interest rates we’re now seeing and, since we’re talking politics, had eased protections on their customers' deposits after US President Trump in 2018 rolled back regulations the Obama administration had put in place to prevent exactly this.
Breakfast Culture is not a political organization and we’ve little interest in the silly slander of FOX News pundits and Florida politicians but as a leader in DEI and the originator of Woke Marketing, we refuse to see this concept rooted in African-American political consciousness continue to be corrupted by conservatives into a silly catch-all phrase for anything they don't like. We've talked about this backlash to wokeness before and it's a deliberate refusal to understand and a goal to undermine. While our definition of woke is simply the awareness of systemic discrimination in our society and a recognition of the need to address it, conservatives throw the term around like confetti, yelling it at transgender people, children's cartoons or now failing banks. After a humiliating moment that went viral, Alex Wagner at MSNBC recently unpacked their lowest point:
We at Breakfast Culture are tired of these semantic games because we deal in facts and there’s a proven history of DEI enhancing the core mission of organizations and generating new revenue streams. In McKinsey’s 2015 study of a range of companies across Canada, the US, the UK and various countries in Latin America, the consulting group found that “companies in the top quartile for racial and ethnic diversity are 35 percent more likely to have financial returns above their respective national industry medians.”
Diversity and inclusion creates better workplace cultures and higher financial returns. As Breakfast Culture Founder and CEO, I’ve helped make this happen and I’m currently leading a series of free webinars explaining how and why. Please join me this Thursday, March 23rd at 12pm ET to unpack how DEI can benefit your organization as McKinsey has reported. Facts, not foolishness.
Let's Break Some Eggs! – Jefferson Darrell, Founder and CEO, Breakfast Culture™ Inc.