George Nichols, American College of Financial Services CEO joins Yahoo Finance’s Kristin Myers to discuss the school’s initiative to promote upward mobility and wealth building for Black Americans.

Video Transcript

KRISTIN MYERS: Welcome back to Yahoo Finance Live. Let's talk now about wealth building and upward mobility for Black America. We're joined now by George Nichols, the American College of Financial Services CEO. George, so you guys have a new center looking at economic equity, the Center for Economic Empowerment and Equality. Tell us a little bit about some of the work that it's going to be doing.

GEORGE NICHOLS: The primary focus of the new center is to address underrepresented groups as it relates to the financial and economic matters that are important to them. There have been so many folks in these underrepresented groups, like Blacks, Latinos, Asians, LGBTQ and others that have not been able to benefit from the great financial opportunities of our country. And so our focus is on how can we help empower them so that they get the same benefits that other Americans have received for so many years?

KRISTIN MYERS: Now, the center is going to be focusing on the Four Steps Forward For Black America. So let's just remind everyone at home, what are they?

GEORGE NICHOLS: The Four Steps Forward program, it was our initial focus on Black America as a result of the national unrest that occurred in 2020. The first step is to address financial literacy for Black females. The second is how do we assist companies in the financial services world of advancing more Blacks into senior management positions?

The third one is how do we help companies recruit and retain more Black advisors? Because if we're successful with the first two, then they're going to want to see people like themselves that are going to help them with their financial decisions. And then the fourth one is what we call collective impact. And it is how do you leverage the financial and intellectual capital of the financial services industry to help advance the upward mobility and wealth creation for Black America?

KRISTIN MYERS: So I want to dive into some of those points. Particularly we had that first one there about improving financial literacy for Black women. How critical are Black women in helping build Black wealth? Or I should say how critical is it to building Black wealth for Black women to helping the Black community overall?

GEORGE NICHOLS: Well, we've concluded that from our research that Black women are the gatekeepers through the Black community. I can say that personally, when I have a mother and four sisters and the strength of them. But they're the key. So let's just think about the impact that they have.

First of all, 89% of Black single-parent households, female. 63% of the head of household in a couple is a Black female. 68% of all of our college graduates in the Black community, female. And then, of course, they're the ones that are having the children and raising Black males, sometimes on their own. So we believe that if we can address their financial literacy issues, their financial well-being, wherever they are in their cycle, that we can impact generations today and all those to come in the future.

KRISTIN MYERS: All right, well, I know that definitely seems to be true in my household growing up. So I was glad to see that highlighted in your survey. George, I want to switch now to racial diversity in financial services. Everyone can see at home that statistic, which is just that 25% of some of those firms surveyed said that their firm's client base was reflective of the nation's diversity, that essentially they themselves did not look like who they work for. We see this problem a lot across the United States. Is it just as simple as increasing the amount of Black and Brown folks that you have as a part of your employee base?

GEORGE NICHOLS: No, we do not think it's just an increase in the number of Black advisors or Black executives. Companies have to make a conscious and deliberate decision that they recognize the importance and the power of investing in communities of color, and especially in the Black community. Just think about it.

There's research that was done by McKinsey and the Federal Reserve that said if we addressed the racial wealth gap of Blacks over the next eight years, we could increase GDP by $1.5 trillion. That's real money. So think about the true economic impact it has on the companies, but more importantly, the economic impact it has on communities. And that's actually where they're making their money from, is that's how they're building their business.

So we think it's they have to make a deliberate decision. And it shouldn't be just Black advisors. White advisors should recognize the power of Black wealth that exists in this country. And our ability to build more of that will just benefit them more in the long term.

KRISTIN MYERS: All right, George Nichols, the American College of Financial Services CEO, thank you so much for joining us today to break some of that down.