(Bloomberg) -- The JPMorgan Chase & Co. investor behind a push for the firm to conduct a racial equity audit criticized the resulting report released last month as containing “several deficiencies.”
In an analysis released Tuesday, SOC Investment Group took aim at JPMorgan’s choice of auditor, PricewaterhouseCoopers LLP, the lack of auditor recommendations in the report, and the fact that the report was written by JPMorgan rather than PwC. SOC also described an absence of transparency and criticized the scope of the assessment, saying it didn’t look at diversity, equity and inclusion within the biggest US bank.
“Based on the report, JPM and PwC appear to have a basic misunderstanding of what a racial equity audit is and should be, despite being provided highly instructive samples from other prior civil rights audits,” SOC wrote in its report. The two firms “approached this process with the narrow perspective of a financial audit.”
JPMorgan said in March that it would hire a third party to audit its $30 billion racial equity commitment and then publish the result. The pledge to do so came in conjunction with SOC agreeing to withdraw a shareholder proposal on the matter. In 2021, JPMorgan’s board recommended shareholders vote against such an audit, arguing that the firm was already committed to advancing racial equity.
Read more: JPMorgan Agrees to Racial-Equity Audit for $30 Billion Effort
Wall Street’s biggest banks have been under pressure from politicians and activists on both sides of the political aisle for stances on everything from paying for abortion care for employees to financing oil projects. Tuesday’s report lands as conservative leaders in states like Texas and Florida are ramping up pressure on financial firms to back away from social goals.
“This report did exactly what it was designed to do: It examined our racial equity commitment to date and found that we’re making substantial progress with more work to do,” JPMorgan said in a statement Tuesday. A representative for PwC didn’t immediately respond to a request for comment.
JPMorgan wrote in its audit report that as of the end of last year it had deployed $18.2 billion toward its five-year commitment made in 2020. The effort “is focused on the right economic drivers and it continues to learn and adapt as the work progresses,” the firm wrote.
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