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Investment Banking

The U.S. Equal Employment Opportunity Commission

Executive Summary

The Equal Employment Opportunity Commission (EEOC) performed a demographics analysis on the investment banking industry. The industry was defined as Standard Industrial Classification (SIC) code 621: security brokers, dealers, and flotation companies. The study focused on demographic changes reflected in EEO-1 reports from large establishments (1,000 or more total employees) during 1995-2000 for four occupational groups: officials and managers, professionals, technicians, and sales personnel. The demographic groups examined were women and three race/ethnic minorities: blacks, Hispanics, and Asians. Comparisons were drawn with two sets of occupational data derived from the 1990 Census. The first set included key occupations found in investment banking, but taken across all industries. The second set included those occupations found within the investment banking industry. For both sets, the occupations were combined into the four occupational groups described above.

Employees within the industry for the four occupational groups are mostly white and mostly male. Minority representation (the three principal groups and "other" minorities) for the large establishments exceeded 1990 Census levels throughout 1995-2000. However, women's representation was generally below those levels, except for technicians.

For officials and managers, minority representation grew from 12.6% in 1995 to 14.3% in 2000. Women increased their representation from 28.7% to 32.6%, but still were below their availability as indicated in the 1990 Census data.

Minorities made up 25.2% of professionals in 2000, compared to 20.4% in 1995, and were well above the 1990 Census comparisons. Women increased their representation from 41.1% to 44.4% during this period, but still lagged their representation in the 1990 Census data.

Minority representation for technicians increased from 28.1% to 33.6%, although growth was uneven during the period and was due primarily to one group, Asians. Women increased their representation from 32.7% to 36.9%. Women and minority representation exceeded that in the 1990 Census data.

For sales personnel, minority representation showed uneven growth from 10.1% in 1995 to 11.7% in 2000. During the period there were advances and declines for minorities overall and specific groups. Women's representation in 2000 stood at 23.6%, lower than in some years between 1995 and 2000, and lower than the 1990 Census comparisons.

An analysis was performed on 16 selected establishments to gauge over- or under-representation of demographic groups. A mixed pattern emerged for the firms, with women in many instances being under-represented among officials and managers, but race/ethnic minorities tending to be better represented in the managerial group. Among professionals in these establishments, women show a mixed pattern of being under-represented. The same held for the race/ethnic minorities, but with fewer occurrences of under-representation.

A brief literature review was conducted to place this study in context with published reports. These reports tend to fall into three categories: demographics reports similar to this study, reports on the experiences and perceptions of minorities and women in the industry, and scholarly works that track factors influencing the career advancement of minorities and women. It is noted that Census and EEO-1 data do not seem to correspond to some other demographics reports. Some of the discrepancies may be accounted for by focus on specific jobs within the industry, but there may also be differences in methodology from that used with Census or EEO-1 data. Studies on employee perceptions provide a different perspective on career issues that may ultimately impact the demographics of high-pay positions. Some scholarly articles are described as indicative of the kind of research that may be necessary to investigate firm-specific practices impacting equal employment opportunity.


Definitions and Data: Investment Banking

Industry Definition for Investment Banking

For the analytic portions of the Investment Banking study, the industry consisted of Security Brokers, Dealers and Flotation Companies. These companies are found under Standard Industrial Classification (SIC) code 621. The SIC Major Group 62 consists of Security and Commodity Brokers, Dealers, Exchanges, and Services. This major group includes establishments engaged in the underwriting, purchase, sale, or brokerage of securities and other financial contracts on their own account or for the account of others; and exchanges, exchange clearinghouses, and other services allied with the exchange of securities and commodities. The study excluded Commodity Contracts Brokers and Dealers (622), Security and Commodity Exchanges (623), and Services Allied with the Exchange of Securities (628) from the major group.

Occupational Definitions for Investment Banking

As the managerial, professional, technical and sales jobs were the focus of this study, the EEO-1 job categories with the same titles were used when analyzing EEO-1 data and when using 1990 Census data by broad occupational groupings.

The occupational data from the 1990 Census was obtained from the Finance, Insurance and Real Estate industry group, specifically the Other Finance (Census Industry Code 072) grouping.

Within the Census financial industry group, officials and managers were defined as consisting of Financial Managers (Census Occupational Code 007); Managers and Administrators, not elsewhere classified (022); and Other Financial Officers (025). The professional occupations were Accountants and Auditors (023); Underwriters (024); Management Analysts (026); Operations/Systems Research (065); Statisticians (067); Economists (166); and Technical Writers (184). The technicians consisted of Computer Programmers (229), and the sales workers were in Securities and Financial Services Sales Occupations (255).

Industry and Occupational Definitions for EEO-1 Data

Establishments within SIC code 6211 (see note, page 2) and with 1,000 or more total employees were selected. Data are reported according to the occupational groups described above. Data were taken from annual reports spanning 1995-2000. An annual EEO-1 report is legally required of all private employers who are subject to Title VII of the Civil Rights Act of 1964 (as amended) with 100 or more employees. (Educational and certain other private organizations are excluded, but may have other reporting requirements.) Single-establishment employers file one report. Multiple-establishment employers with 50 or more employees may be require to file if they are part of a larger enterprise or engage in specified federal contracting.

Analysis: Investment Banking


Three types of data were used in comparisons represented in the charts:

  • 1990 Census, all industries, key occupations found in Investment Banking; this is labeled 1990 Census (Occupation).
  • 1990 Census, Investment Banking industry (Standard Industrial Classification [SIC] code 621), key occupations; this is labeled 1990 Census (Industry/Occupation).
  • 1995-2000 annual EEO-1 reports, Security Brokers and Dealers (SIC code 6211), establishments with 1,000 or more employees; these are labeled [year] EEO-1 (Brokerage).

Note that the EEO-1 data is for establishments having 1,000 or more employees in a given year.

The 1990 Census occupations were grouped to correspond to four occupational groups used in the EEO-1 reports: officials and managers, professionals, technicians, and sales workers.

The major race/ethnic groups are black, Hispanic, and Asian. The analyses are based on these three groups. Other minorities combined were less than half of one percent in any occupational category.

The representation of women and race/ethnic minorities are presented in Figures 1-4. Each figure contains four charts, each corresponding to one of the four occupational groups. Data are expressed as percentages of the data source being presented (e.g., percentage of black officials and managers in the 1990 Census (Occupation) source.) The contents of the figures are as follows:

  • Figure 1 presents the two 1990 Census sources and the 1995 EEO-1 data for establishments of 1,000 or more employees by race/ethnic minority.
  • Figure 2 presents the same data sources by sex.
  • Figure 3 presents EEO-1 data spanning 1995-2000 for establishments of 1,000 or more employees by race/ethnic minority.
  • Figure 4 presents the EEO-1 data described above by sex.

The number of establishments with 1,000 or more employees grew from 25 in 1995 to 62 in 2000.

The total number of employees in these large establishments grew from 73,121 in 1995 to 149,308 in 2000.

For all investment banking establishments filing EEO-1 reports in 2000, the 62 large establishments had 45.8% of all the employees.

For the EEO-1 data presented in the charts, a decline in any race/ethnic or sex group generally does not mean a decrease in the number of employees. It means that the group was not growing as fast as other groups to which it is compared.


Investment banking employees in the four occupational groups mentioned above are mostly white and mostly male. The percentages vary with occupational group.

Minority representation for the four occupational groups in the large establishments exceeded that for 1990 Census data and continued to grow during 1995-2000. Asians led the growth.

Representation for women in the large establishments during 1995-2000 was below that in the 1990 Census data, except for technicians.

Officials and Managers

Overall minority representation for the large establishments in the 1995 EEO-1 reports exceeded that in either of the two 1990 Census reports. Minority representation for the large establishments grew from 12.6% in 1995 to 14.3% in 2000.

The fastest growing minority group was Asians, which increased from 4.1% in 1995 to 6.1% in 2000.

Hispanic representation for the large establishments lagged behind the two 1990 Census figures for all the 1995-2000 EEO-1 reports. In 2000, Hispanic representation in the large establishments was 3.0%. Hispanics made up 4.2% of the industry's officials and managers in 1990.

Blacks were about 5% of the officials and managers in the large establishments during 1995- 2000. This was slightly higher than their 4.2% in the industry in 1990.

Women increased their representation in the large establishments from 28.7% to 32.6% during 1995-2000. But this was still below their industry representation in the 1990 Census, 39.3%.


Minority representation based on EEO-1 reports for the large establishments was well above Census figures for the industry and continued to grow during 1995-2000. At the end of this period it stood at 25.2%, about nine percentage points higher than the 1990 Census figures. Asians led the growth, expanding their representation from 9.4% in 1995 to 13.2% in 2000. The growth for blacks and Hispanics was smaller and less consistent across the time period, although both groups had overall gains in representation during 1995-2000.

Women's representation also showed uneven growth during 1995-2000, but had an overall increase during the period of three percentage points, from 41.1% to 44.1%. But this figure was still more than five percentage points below women's representation in the 1990 Census occupation and industry figures.


The technician category for investment banking consists overwhelmingly of computer programmers. Overall minority representation in the large establishments during 1995-2000 was well above that in the 1990 Census data. Although growth was uneven during this period, minority representation increased from 28.1% to 33.6%.

Asians showed the largest increase, 14.9% to 20.7%, and accounted for most of the growth in minority representation. Representation for blacks and Hispanics fluctuated during 1995-2000 and finished essentially unchanged, although representation for both groups during the period was above that in the 1990 Census data.

Women, however, increased their representation in the large establishments from 32.7% to 36.9%. Growth was steady throughout the period and ended with representation above that in the 1990 Census data.

Sales Workers

Of the four occupational groups discussed here, the sales worker group has the smallest minority and female representation. In 2000, the figures for the large establishments were 11.7% and 22.8%, respectively.

Minority representation was above that in the 1990 Census data and grew unevenly during 1995- 2000.

Asians were the most represented minority and increased their representation from 3.4% to 4.5% during this period. Blacks increased from 2.9% to 3.5%, but were still below their representation of 3.9% in the 1990 Census occupation data. Hispanics finished the 1995-2000 period with 3.5%, lower than the 4.0% representation they had in 1997, but higher than their representation in the 1990 Census data.

Women's representation in the large establishments fluctuated during 1995-2000 and finished at 22.8%. This was slightly below the 23.6% in 1996 and 1999, and below the occupation and industry figures from the 1990 Census.

Figure 1. Census (1990) and EEO-1 (1995) Representation by Race/Ethnic Minority

Figure 2. Census (1990) and EEO-1 (1995) Representation by Sex

Figure 3. EEO-1 (1995-2000) Representation by Race/Ethnic Minority

Figure 4. EEO-1 (1995-2000) Representation by Sex

Analysis of Selected Firms: Investment Banking

EEOC performed a preliminary analysis of specific firms to gauge the extent of under- or over- representation of demographic groups. Using data available from the 2000 EEO-1 reports, "target" establishments were identified from the group of establishments having 1,000 or more employees that had a high proportion of officials and managers, and professionals. There were likely to be major underwriting centers. Since most of the large establishments were in the New York City area, only targets from this locality were used, to avoid possible confounding with differing local labor market conditions. Design considerations for the analysis are as follows:

  • Comparison group: All establishments with SIC code 6211 and 1,000 or more total employees.
  • Target establishments: Establishments meeting the above criteria and also
    • located in the New York City area;
    • with 65% of employees either officials and managers, or professionals; and
    • not known to be part of a discount brokerage firm.

The decision rules for flagging a demographic group as being over- or under-represented within the two occupational groups were as follows. First, the difference between the target and comparison had to be statistically significant, i.e., having less than a 5% chance of being a random variation in the data. Second, the difference had to represent at least 30 people above or below the employment level expected for that demographic group, where the expectation is based on the comparison group average. This is a rough indicator that the difference is large enough to have practical significance.

The results can be seen in Figure 5. The pattern is mixed, but some overall trends can be discerned.

Women tend to be under-represented in these select establishments compared to their representation in large establishments generally. This may be indicative that women tend not to hold senior positions in the locations where major business decisions are being made. On the other hand, race/ethnic minorities seem to be represented in these establishments more in line with their representation in the comparison group.

The picture is more mixed for professionals. Women are under-represented in nine establishments.. The race/ethnic minorities also show this mixed pattern, although with fewer occurrences of under-representation.

A closer look at selection practices and the employment growth of these specific firms would be needed to reach more definitive conclusions.

Figure 5. Demographic Under-Representation for Selected Investment Banking Establishments, 2000 EEO-1 Data


Analysis of Charge Data System Information, 1995 through 2000: Investment Banking


The Charge Data System (CDS) contains information on the bases and issues involved in discrimination charges filed with the EEOC or state and local agencies. Data for SIC 621[1] were obtained and edited for the analysis. Frequency counts were taken for new charges by year for the primary basis and issue combinations listed in the CDS. The chart provides a summary of the most frequently cited primary issue/basis combinations.


Within the industry (SIC code 621), the general trend has been a decline in charges over the time period under study. It is uncertain whether this decline is due to better monitoring of EEO issues by companies within this industry, or to downsizing and consolidation. By far, the largest number of charges was filed by females. Many of these charges involve discharge and constructive discharge. Also of note, particularly in the earlier years, are discharge and constructive discharge complaints filed by blacks.

Literature Review: Investment Banking

EEOC conducted a brief survey of literature on equal employment concerns in the investment banking industry. The purpose of this survey was to place this report in the context of other reports and articles in published sources. There were three main types of articles: statistical overviews of demographic diversity, studies on perceptions of women and blacks in the industry regarding workplace environment and advancement, and scholarly articles that explore factors impacting the advancement of women at high levels.

The demographics study cited in recent newspaper articles is the Securities Industry Association's (SIA's) Report on Diversity Strategy, Development, and Demographics. This study, conducted in 2001, followed a diversity survey conducted in 1998. The 2001 survey was primarily focused on diversity programs and found that the very large firms tended to have such programs in place. The results were more mixed for the smaller firms, and low response rates in small and mid-sized firms made conclusions only tentative. However, demographics were reported for several occupational categories. The demographics reported by the SIA differ in many regards from those presented in this study. This can be accounted for in part by varying definitions of occupational categories. For example, SIA reports that 94% of industry executives are white. This figure seems high compared to 85.7% for officials and managers for large establishments in the 2000 EEO-1 data. The discrepancy might be explained by executives being the most senior decision makers. Both sets of data may be accurate and reflect a lack of diversity in the highest ranks a "glass ceiling" issue. Other discrepancies with the EEO-1 data or 1990 Census data may reflect methodological differences.

In January 2002 the Christian Science Monitor carried a report that women seeking stock-trading licenses preferred careers as asset managers or financial planners, rather than seeking careers in either retail brokerage or investment banking, compared to men. This one article is hardly conclusive, but it indicates another facet of the demographics issue: interest and availability within demographic groups for investment banking. The 2000 Census may shed additional light when the occupational data become available.

In 2002 Professors Alfred W. and Ruth G. Blumrosen produced a report based on EEO-1 data and made it available on the Web. The report, Intentional Job Discrimination in Metropolitan America--1999, uses the same data base as this report, but without the identity of specific establishments. Also, the Blumrosen report apparently looks at a wider grouping of financial institutions in its "securities and brokerage" category than was examined in this study. That category is identified as one of forty "equal opportunity discriminators" that discriminates against women and minorities.

The Blumrosen hypothesis is that a demographic imbalance in itself for any firm relative to the average demographics of the firm's industry constitutes deliberate discrimination. Apart from legal considerations that such evidence can, in some circumstances, establish a prima facie case of discrimination that can still be rebutted by additional evidence, the approach seems to ignore firm-specific consideration such as the exact nature of the work, different and sometimes conflicting demographic patterns with a firm by organizational level and occupational grouping, applicant flow, and personnel selection practices. (The establishment-specific analyses in this report illustrate the complexity of over- and under-representation patterns when individual units are examined.)

Studies that report on perceptions of minorities and women are exemplified by Catalyst's Women in Financial Services: The Word on the Street, published in 2001. The study presents similarities and differences between men and women on factors such as job satisfaction, commitment to present employer, and perceptions regarding advancement and fairness. This type of study differs from the current report in that its focus is primarily on a limited number of employees (the survey sample) and identifies what employees think of their workplace, with attention to factors that influence advancement. In contrast, this report deals with demographic statistics and statistical trends as obtained from legally required reporting.

Besides the Catalyst study, newspapers have run several articles that focus on the experiences of specific women in the industry or related industries such as retail banking. These articles usually generalize beyond the particular people interviewed for the article, but depend on previously- published sources regarding demographics or human resources practices.

The history of blacks in the industry is recounted by Gregory Bell's 2002 book, In the Black: A History of African Americans on Wall Street.

The third type of literature, found in scholarly journals, presents an application of social science methodology to understanding factors that influence the career advancement of women in the industry. The number of articles is still relatively small, but there is a growing body of research, some of it general and some of it specific to financial occupations, on "glass ceiling" effects. The methodology holds promise for identifying and evaluating gender-based employment practices. For example, "social capital," the ability to cultivate interfirm networks to generate business, may be an essential quality at high-level positions in financial institutions. The perceived lack of it may operate to the disadvantage of women who have already proven their technical skills in mid-level positions. Work/family conflict affecting women may be a diminished but still-present issue senior organizational levels, particularly if the employee is responsible for producing revenue. An article currently in press suggests that merit-based compensation structures in underwriting may contain subjective (and possibly impermissible) factors along with objective considerations.


1. SIC code 6211 excludes from the broader 621 classification a small number of "financial advisor" establishments, none of which employs 1,000 or more employees.

This page was last modified on September 24, 2003.