Wells Fargo( WFC ) - Get ReportChief Executive Charles Scharf reportedly sparked controversy in a Zoom meeting this summer when he reiterated that the bank had trouble reaching diversity goals because there was not enough qualified minority talent.
Shares of San Francisco bank at last check were up 0.4% at $23.74.
Reuters reported that Scharf also made the assertion in a June 18 companywide memo. The memo unveiled diversity initiatives as nationwide protests broke out after George Floyd, an unarmed African-American man, died in Minneapolis police custody.
“While it might sound like an excuse, the unfortunate reality is that there is a very limited pool of black talent to recruit from,” Scharf said in the memo,.
Scharf spent more time listening than speaking during the previously unreported 90-minute call, which he initiated.
His comments about African-American talent upset some attendees, Reuters reported, citing two employees, who spoke on the condition of anonymity because they feared repercussions.
Not all the meeting's attendees recalled being offended.
Alex David, president of the Black/African American Connection Team Member Network, told Reuters “the meeting was incredibly constructive. ... I walked away being incredibly surprised at how genuine and sincere he is.”
However, Ken Bacon, a former mortgage-industry executive on the boards of Comcast, Ally Financial and Welltower, told Reuters he was “shocked and puzzled” by Scharf’s comments.
A Wells Fargo spokeswoman defended Scharf’s record on diversity, telling Reuters that the CEO has pledged to double the number of African-American leaders over five years and tied executive compensation to reaching diversity goals.
Rep. Alexandria Ocasio-Cortez (D-New York) also criticized Scharf, tweeting on Wednesday: "Perhaps it's the CEO of Wells Fargo who lacks the talent to recruit Black workers."
This was not the first time Ocasio-Cortez has tangled with a Wells Fargo executive. Last year she grilled former CEO Tim Sloan about Wells Fargo's financing of companies that built immigration detention centers in which children were separated from their parents.
"For a period of time, we were involved in financing one of the firms," Sloan said. "We aren't anymore."
Sloan resigned last year and Scharf took over the top spot at the bank, leaving his role as chairman and CEO of Bank of New York Mellon( BK ) - Get Report.
In July, Wells Fargo posted its first quarterly loss in more than a decade and slashed its dividend by a wider-than-expected margin as the coronavirus pandemic continued to slam the bank's earnings and profit outlook.