Originally published June 16, 2023 8:49 am PDT
In step with Diversity, Equity, and Inclusion (DEI) initiatives saturating the mainstream business world, Bank of America (BoA) announced on Wednesday that it has more than doubled its initial commitment, deploying over $500 million in equity investments to minority- and women-led funds.
This announcement comes despite legitimate questions about whether these initiatives help or hinder overall economic progress, with Target and Bud Light’s financial losses representing two recent examples.
“We work across our company to address critical needs in our communities, including the lack of access to capital that diverse business owners face as they start or grow their businesses,” Tram Nguyen, Global Head of Strategic and Sustainable Investments at Bank of America, stated in a press release.
Critics of such moves argue that this kind of thinking shifts focus from investing based on competence and business viability to investing based on individuals’ immutable physical characteristics.
BoA’s investment approach apparently favors certain groups over others, raising concerns about the fairness and potential bias in this decision.
The bank has committed equity to over 150 funds that have in turn invested in over 1,000 companies in 40 states.
These companies reportedly employ over 21,000 people and are led by 1,500 diverse entrepreneurs, a detail BoA was keen to emphasize.
Nasir Qadree’s Zeal Capital Partners, which provides “overlooked founders” with resources to scale toward their next stage of growth, was one of the recipients.
Despite the fact that many may argue it’s not an investor’s job to decide who has been “overlooked,” Bank of America seems to be taking on that mantle.
It funded the “Black-owned unicorn” Esusu, which assists immigrants and minorities with credit-building tools.
In addition, Chingona Ventures, another beneficiary of BoA’s identity-focused agenda, is led by General Partner Samara Hernandez.
The bank celebrated the fund’s unique identity-based distinction, stating it was the only active fund in the Midwest started and led by a Latina at the time of the bank’s investment.
Bank of America continues to emphasize its commitment to DEI ideology, vowing to provide the capital and resources entrepreneurs and small business owners of “all backgrounds” need to help fuel economic growth in their communities.
Critics, however, caution that the focus should always remain on funding the best businesses, regardless of who’s at the helm.
Last month, House Judiciary Committee Chairman Jim Jordan (R-OH) and Subcommittee on the Administrative State, Regulatory Reform, and Antitrust Chairman Thomas Massie (R-KY) sent a letter to Bank of America (BoA) CEO Brian Moynihan “demanding information and communications between BoA, the FBI, and the Department of Justice related to the events of January 6, 2021,” according to a press release.
“The House Judiciary Committee and Select Subcommittee on the Weaponization of the Federal Government released a report highlighting whistleblower testimony that disclosed BoA provided the FBI—voluntarily and without any legal process—with a list of individuals who had made transactions in the Washington, D.C., metropolitan area with a BoA credit or debit card between January 5 and January 7, 2021,” the release outlined.
“The report also suggests that individuals who had previously purchased a firearm with a BoA product were elevated to the top of the list regardless of when or where the purchase was made.”
