The U.S. economy is being bridled by forces of our own making. Recent research I’ve done with colleagues at the Federal Reserve Bank of San Francisco shows that disparities in educational attainment, occupational opportunity, and employment and wages reduced GDP by more than $70 trillion over the past 30 years. That’s a staggering loss that limits our economic future and our competitiveness in the global economy.
We must change.
Today, the San Francisco Fed is releasing a Framework for Change—our commitment to taking action that will result in greater racial and ethnic equity in our organization and the communities we serve.
Our Framework for Change recognizes that small, uncoordinated actions will not be enough. To truly produce change, we need to collectively employ all of our tools and levers to create a virtuous, self-reinforcing cycle.
A Framework for Change
Committing to racial and ethnic equity in our organization and the communities we serve
We will act across four key pillars so we can have continuous impact: Evidence, Practice, Dialogue, and Advocacy.
- Evidence: Publishing research that examines the root causes and consequences of racial economic disparities, as well as the economic gains from racial equity.
- Practice: Overhauling our hiring process to include more diversity checkpoints, and setting new supplier diversity targets to support small, local, women- and minority-owned businesses.
- Dialogue: Continuing our Board diversification efforts, and engaging with business and community leaders to share our research and identify solutions that address the root causes of disparities.
- Advocacy: While we do not engage in policy advocacy, we are advocates for big, bold actions and ideas that promote a strong, healthy, and inclusive economy. We champion racial equity because research has demonstrated that it will help support our mission and dual mandate.
In the coming months, we will provide specific, concrete, and measurable actions in each of these areas. We will make our goals transparent, and we will publish our progress at the end of each year so that we are accountable to ourselves and to everyone we serve.
Our goals will be audacious, and we recognize we may sometimes fall short in achieving them. But we know that falling short of an audacious goal delivers more change than meeting a modest one.
Combatting inequity in our society is an imperative. It is critical to our economy and to our aspirations as a nation. Everyone has a part to play. We must move beyond good intentions and evaluate the outcomes of our actions. We must start today.
Mary C. Daly is President & CEO of the Federal Reserve Bank of San Francisco.
Note: This post was updated on June 7 and September 1, 2021. Our Framework for Change has been updated since its launch in February 2021. For the latest information about the initiative and our progress, visit our Commitment to Equity page.
The views expressed here do not necessarily reflect the views of the management of the Federal Reserve Bank of San Francisco or of the Board of Governors of the Federal Reserve System.