This is the fourth in a series of articles based on the guide to Centering Equity in Corporate Purpose published by FSG and the Shared Value Initiative in May 2022.
In recent years, in part as a response to public outcry over the murder of Black Americans by law enforcement and a growing recognition of systemic inequities, a rising number of companies have announced significant new commitments to advance racial equity. These commitments have included billions in pledged philanthropic funding, increases in diversity across workforce and leadership, and investments in institutions supporting communities of color. However, as JUST Capital showed in its 2022 Corporate Racial Equity Tracker, while the promises have been expansive and we have seen some progress, companies need to do much more to meaningfully shift persistent inequities. We believe that companies are best positioned to live up to their commitments when they see equity as a source of both societal and business value, rather than solely a cost or a constraint.
Companies have a greater incentive to realize and grow their commitments when they identify how advancing equity can lead to tangible financial outcomes. This can include revenue growth from products that address inequities or the acquisition of new customers due to sales and distribution strategies that increase access to services that enhance wealth or health. Instead, companies often focus on the intangible benefits of their efforts to drive equity, including reputational improvements and employee satisfaction, without making the link to measurable business performance. Focusing on the potential to create and capture tangible business growth by authentically addressing inequities incentivizes companies to embed equity into core business strategies and dedicate the resources necessary to expedite, sustain, and expand these efforts.
In our recently released guide, Centering Equity in Corporate Purpose, we offer practitioners advice on how to place equity at the center of corporate purpose. The guide shares five practices and a set of enabling conditions that allows the practices to take hold and flourish. The fourth practice—New Value Creation—urges companies to consider how advancing equity can contribute to long-term profitability. As we explain in the guide, doing so effectively involves shifting or developing new business strategies and requires companies to think about the “who,” “what,” and “when” of their business model in a new way.
I am fortunate to speak to Shané Harris, the President of the Prudential Foundation and Vice President of Social Responsibility and Partnerships, about her experience centering equity in new business growth strategies. Within the Foundation, Shané has been helping to lead Prudential’s efforts to advance equity for over 18 years and she is now also leading Prudential’s Blueprints to Black Wealth, which is exploring new ways that the company can help Black consumers build intergenerational wealth. While Prudential has been deeply involved in advancing equity through its philanthropy for decades, the Blueprints to Black Wealth is designed as a shared value strategy to drive business growth by advancing racial equity.
Shané, can you tell us a little more about Blueprints to Black Wealth and how it is pushing Prudential to think about the connection between addressing inequities and creating value in a different way?
Prudential is a purpose-driven company that aspires to make lives better by solving the financial challenges of our changing world. While the work of advancing equity is very much connected to realizing our purpose, it had primarily been seen as a responsibility of our CSR function, in part because of our deep connection to our headquarters city of Newark, New Jersey.
The civil and racial unrest in the late 1960s significantly shaped how Prudential thought of social responsibility. In that aftermath, we established and formalized our impact investing and philanthropic programs and over the past 40 years, have focused our investments on strategies that help remove systemic barriers for underserved communities and accelerate access to economic opportunity.
While we built a great reputation for our leadership in community investments, we lacked a collective vision and understanding on how we could center equity in our business strategy and truly become a purpose-led company, where our thinking and decision making as a company are informed by our purpose. The 2020 global pandemic brought the consequences of systemic racism and inequity into sharp relief for our society. It also allowed Prudential to examine new ways to integrate equity more fully into our core business practices. Blueprints to Black Wealth reflects our deepened commitment to accelerate our efforts to engage with communities that have been historically overlooked by our industry, build new customer relationships, grow our market, and live our aspiration to be fully inclusive.
What type of value does Prudential expect to see as a result of Blueprints to Black Wealth? If the value is more intangible than tangible, will you consider the initiative to be a success?
Through Blueprints to Black Wealth, we seek to increase financial security and resiliency for Black Americans by expanding access to Prudential’s products and solutions among mass and middle market Black consumers. We believe that by helping more Black Americans experience enhanced financial security, asset protection and wealth accumulation, we will help to create tangible business outcomes that increase Prudential’s penetration in a growing market.
However, the journey to achieve this outcome will require Prudential to take a holistic, long-view approach to building authentic connections with Black Americans rather than taking a transactional view to customer acquisition. It will require us to engage current and prospective customers holistically to create an emotional connection by acknowledging their cultural values, motivations and how they experience the world. This is particularly important given the high distrust Black Americans have with the financial services industry due to its legacy of financial exclusion and discrimination. So, we know that the foundational work for Blueprints will be to earn trust within Black communities while we continue to build capabilities within Prudential that help us better meet the financial needs of this growing customer segment.
That’s why we are leaning into a partnership strategy that allows us to draw from our decades of experience of building trusted relationships within communities to help us understand the Black American financial journey more deeply. Our partners not only lend their credibility, but because of our high value on co-creation and collaboration, they create a space for our learning, which is a crucial step before we ever start talking about products and services or driving immediately to a bottom-line or sales discussion.
We are also learning that reaching these customers requires all of us at Prudential to think differently about how we define a viable customer. Historically, the financial services industry has taken a narrow view of what constitutes a customer, focusing solely on income and assets. This limited approach leaves many viable customers out of the financial equation and misses the opportunity to meet the needs of individuals early in their financial journey.
What has been important for Prudential to understand and have in place when developing the strategy?
We’ve been on this journey for two years, and our learning has provided clarity on the needs of Black consumers and helped us further understand the impact of structural barriers to wealth creation. Importantly, Black consumers are not a monolith, so understanding the priorities and needs of varied segments of these consumers is an important part of our efforts to build trust and demonstrate that Prudential understands the complex nuances that inform the needs, priorities and expectations of Black consumers. Some of this learning is happening in formal ways like research and surveys, while other lessons are shared directly from consumers through our partners who are on the ground.
In order for this work to be effective, we also needed alignment and buy-in from senior leaders for what success would look like and what it would require. That support has proven to be the critical unlock of investment and contributions (both financial and human capital) from our core businesses in order to ensure that our businesses understand the potential of Blueprints to deliver tangible financial results to the company bottom line.
What lessons has Prudential learned about developing a business strategy with equity at the center?
To successfully develop a business strategy that has equity at its core requires every employee and business leader to reexamine every process, product and policy to ensure that we are leading with purpose. While there is alignment across the enterprise that this is the right way to demonstrate our purpose, it requires us to consistently challenge ourselves and one another to explore how we do business. That is not easy. It has required us to deploy change management tactics to think differently about everything from the language we use (e.g., employing asset-framing language versus deficit-framing), how we define viable customers and how our brand resonates with consumers that we haven’t historically focused on reaching, to partners we select, but also challenging ourselves to get very granular about expected outcomes and societal goals that we expect to achieve and our strategy to get there.
With roots as an insurance company, mitigating risk is a core competency for us. The early phases of this work have been based on carefully curated hypothesis about what is necessary to create business value while also addressing this persistent societal challenge. Taking a test and learning—and potentially fail fast and reset quickly with new, better-informed approach—is a newer muscle for us, and it can be uncomfortable. However, we know that we are already learning more and are able to move faster using a more agile approach. This is hard work. And there is no real model for it—even across or within industry—because we believe what we are embarking on is new.
How has helping to launch Blueprints to Black Wealth made you think differently about your role as a corporate social impact leader?
Supporting the development of Blueprints to Black Wealth has been a rewarding experience. It has helped me broaden the definition of a corporate social impact leader beyond deploying philanthropic investments to drive societal change to utilizing Prudential’s core business strategy to accelerate and scale social impact. The work of Blueprints requires facilitating a deep integration of the full capabilities of Prudential and connecting them to a broader ecosystem of partners committed to strategies that help address the racial wealth gap. While our vision for Blueprints is bold and we believe can help scale the reach of wealth-building tools to customers who have traditionally been underserved by the financial services industry, the work of centering equity in corporate purpose requires new skills and often challenges conventional business practices. It requires a long-term commitment to seeking solutions that expand the reach, quality and affordability of critical financial services and tools, which we believe can help Prudential be a leader in creating a more inclusive and equitable economy.
Thank you, Shané, for your candor about Prudential’s journey and the ongoing learnings from this work. We look forward to seeing what’s next and how this effort unfolds.