Leadership courage: the critical element to close the racial wealth gap

Once again, we are celebrating Black History Month. It’s a key opportunity to reflect on the many history making achievements of black and African Americans. We celebrate with pride and inspiration recognizing that many faced tremendous challenges and obstacles – but prevailed because of resilience and courage.?While we look back and celebrate history – we must also look forward and recognize that we have the opportunity to establish even more building blocks now that will help address the racial wealth gap and create history for many African Americans. I believe that the biggest opportunity to closing America’s racial wealth gap is courage.

We do not lack the burning platform. Today, we have data proving that there is a 10 to 1 wealth gap in the U.S. between a typical white family and a typical Black family, and we know that this disparity impacts people’s health, educational attainment, housing, food security, preparedness for retirement, and more. We also know that a lack of diversity and belonging can hold an organization back from realizing its full potential.

We do not lack information about the drivers to close the gap. The list of evidence-based programs, policies and practices that can begin to bring about systemic change is growing longer each day.

We do not lack the resources. The United States of America is arguably the greatest, most powerful, and wealthiest nation that has ever existed, and most economists and industry watchers believe that the U.S. economy and the businesses that fuel it will continue to grow.

What we need today above all is intentional, courageous leadership. Why?

Because courage is catalytic. Courage begets courage. I have seen it with my own eyes.

For example, for years, Northwestern Mutual had made significant charitable investments in underserved, predominantly Black and Hispanic neighborhoods to improve housing, education, and safety. The company had also worked steadily to increase the number of people of color working at our headquarters and across the nation as financial professionals. But in 2020, our leaders boldly chose to commit even further towards change, creating a Sustained Action for Racial Equity task force. Chaired by our CEO John Schlifske, the task force is comprised of senior leaders, employees and financial advisors set out to build Black prosperity inside and outside our organization. This CEO-led commitment was made recognizing the challenges ahead but forged ahead because it’s the right thing to do.

One of the key early commitments the task force made was a $100 million Impact Investing Fund aimed at advancing financial inclusion and closing the racial wealth gap. The fund was established to focus on improving physical and social infrastructure; providing access to capital for Black individuals and businesses with a focus on low to moderate income communities; and creating healthy, sustainable neighborhoods and communities within Southeastern Wisconsin and across the rest of America.

On top of that, we dedicated $20 million to investing in via Northwestern Mutual Future Ventures, our company’s corporate venture fund. We also created the Northwestern Mutual Black Founder Accelerator?, which seeks to invest in up to ten start-up companies per year led by Black founders. In addition to a $100,000 investment, each participating startup receives a concierge experience during the 12-week program, including a Northwestern Mutual mentor.

Here is the key point: that bold decision by our leaders to dedicate funding, mentorship and sponsorship to Black entrepreneurs helped embolden several Black aspiring entrepreneurs to take a chance on themselves and the business ideas they had been longing to bring to life.

For example, our company invested in Dennis Cail’s organization called Zirtue.

This company aims to help unbanked and underbanked people to gain access to peer-to-peer loans and inspire more risk-taking ventures in underserved neighborhoods.?

We invested in Chad Johnson’s company called Tip a ScRxipt, which provides a digital solution to help people find more affordable ways to pay for otherwise expensive out-of-pocket medication costs. The organization’s mission was inspired by his mother – who had lost her employer-based health care coverage and suddenly needed to personally cover the costs for expensive prescription medicines.

And we invested in Fonta Gilliam’s startup Wellthi, which connects banks and credit unions of all sizes to make saving as a group safe, convenient, and transparent.

These are just a few of the many Black-founded organizations we are directly supporting, and the list is growing and growing: River, Goalsetter, Brick, MentalHappy, Freeman Capital, Hued, RiftPay, Solo, 4Degrees, CrossKudi, Mark Labs Inc and Qualifi.

Courage begets courage. Courage creates Black history. It was true for these entrepreneurs and the same is true for emerging Black talent at Northwestern Mutual. A few years ago, our leaders boldly chose to create a networking initiative that enables Black talent at all levels of the company to interact with executive leaders. Those interactions, paired with other development and advancement strategies, have helped inspire these professionals to take the risk and pursue new career opportunities with greater levels of responsibility, increasing the number of Black professionals in mid-level and senior-level positions across the company.

As we close out this Black History Month, I hope each of us can be immersed in Black culture, contributions, and history. But as we look back, I hope we look back specifically at the courage that many leaders displayed to enable others’ confidence to grow. These are a few powerful examples of the way courageous leadership can create change. I am so proud of the way our leaders have honed in, dared to push and driven progress. My call-to-action for others is to do the same: commit to acting courageously, creating the space for others to act boldly. Will you make this pledge? Let me know.