J.P. Morgan was reported to take up around a fifth of total US bank profits in the first nine months of 2023, providing much more satisfactory bonuses for its employees compared to their industry peers.
Having experienced unprecedented development after Jamie Dimon became its CEO, J.P. Morgan gained even more prominence in 2023 due to its rescue of First Republic Bank, one of the largest US banks offering commercial banking services. This again sparks public interest in what kind of impact the industry-leading bank has on society, especially amidst the growing attention of DEI, ESG, and sustainability.
DEI (company internal operation)
Diversity in employees
J.P. Morgan holds a strong position to promote diversity in its workforce. Annually, it publishes a detailed report of its employees’ racial and gender backgrounds, which offers clear and detailed indication on how the big bank does on encouraging participation of socially marginalised groups. Moreover, under the US context more specifically, its Second Chance Agenda offers job opportunities to people with a criminal record (1/3 of US population). This move not only helps these people to start a meaningful career but also mitigates an annual cost of up to $87 billion by not welcoming these people into the labour force.
ESG & Sustainability (company external impacts)
Active investment
With the aim to deliver $2.5 trillion from 2021 to the end of 2030, J.P. Morgan demonstrates commitments to green growth. Under its Sustainable Bond Framework, J.P. Morgan facilitates market development via Green Bond issuances. For example, its Green Social Sustainable Bond Fund (Net Asset Value up to EUR 103.89) directs capital to debt securities that support initiatives contributing to sustainable and inclusive objectives. Besides this, it pivots and supports its clients’ sustainability goals to create long-term value by offering dedicated research of sustainable investment. For instance, its Global Sustainable Investing team under Asset Management and Centre for Carbon Transition provide green economy-focused research to strengthen its clients’ portfolios and business strategies.
Funds made available for small businesses
J.P. Morgan serves more than 6 million small businesses in the US, which helps to channel crucial monetary support for credit constrained small business owners, alongside mentorship to boost their strength in their respective industries. This has helped to increase the resilience of once vulnerable communities and encouraged economic growth.
In conclusion, as the largest bank in the US and one of the top players in the international finance system, J.P. Morgan exerts abundant influence in the economy. Its commitment to create positive impact is crucial to promote a more diverse labour force as well as a more inclusive commercial environment. The key of assessing its impact, however, is its “net impact”. Given its scope of influence, it is rather challenging to clearly measure whether it imposes more positive or negative changes on society via its numerous transactions every day. For example, how exactly its investments in sustainable projects have been used wisely to drive green growth, as compared to its more traditional investments. This would never be an easy question to answer, yet the good news is that J.P. Morgan recognises its crucial role in society and demonstrates its conviction to promote positive impact.
Written By: Zoey Chen
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