CME’s Duffy on Wall Street reputation issues

Henny
Ray Abrams/AP

• In this op-ed, CME Group CEO Terry Duffy argues that 10
  years after the financial crisis, many are still distrustful of
  the financial services industry and that has an impact on
  recruitment. 
• More needs to be done to gain the confidence of the
  country’s best and brightest to convince them that a career in
  finance can benefit society at large. 
• The industry needs to take educational steps to put the
  world of finance on the radar of middle and high school
  students, Duffy says. 

On September 28, 2008, the Dow Jones Industrial Average dropped a
historic 777 points in a single day, one of many unprecedented
events that characterized the greatest economic downturns since
the Great Depression. In the decade that has gone by, much has
changed. Our economy is experiencing steady — and by some metrics
record — growth and the Dow continues to outdo itself on a
weekly, often daily basis. Yet, some blowback from the 2008
crisis can still be felt within financial services, particularly
as it relates to recruitment. Lingering negative perceptions
about our industry have created a reputational challenge that has
far-reaching consequences.

Despite the long-running bull market, strong economic expansion
and a universal focus on enhancing risk management, the memory of
the crisis is still fresh in the minds of a generation of
graduates. In many cases, this is fueling a general distrust of
the financial services industry. 

That distrust is hurting the future of our business as today only
13 percent of MBA grads enter the industry compared with 20% in
2008, according to the Graduate Management Admission Council.
Likewise, it is harming consumers, particularly millennials, who
according to many press reports, appear to have largely sat out
this record market run. 

That’s why we should use this 10-year anniversary of the crisis
not to reflect on the past, but as a reason to focus on further
repairing and enhancing the reputation of our industry. In these
efforts, we must do more to convey the value of our markets — to
both consumers and future candidates alike — and demonstrate how
the deployment of capital fuels innovation and growth across
industries, while improving the lives of countless people.

Through lending and issuing securities and offering risk
management and other investment tools, the financial services
industry plays a constructive role in everyday concerns, ranging
from home mortgages and car loans, to pension funds and 401ks, to
the funding of innumerable infrastructure projects such as the
development of schools, bridges and public parks.

Yet none of these projects, which create jobs and drive business
growth, are possible without behind-the-scenes financial talent.
And that’s where we must take steps that will allow us to
constantly refresh the recruitment pipeline.

The brilliant minds who will become the next generation of
economists, traders, technologists, financial engineers and
mathematicians need to hear from us sooner about the positive
societal role we play. We need to make a greater effort to gain
their confidence and show them how successful careers in finance
have the potential to benefit not just themselves and their
families, but also society at large.

This process — providing young talent with a correct
understanding of financial principles, and the beneficial impact
they can have for everyone — should start before college.
Currently, only one in five states requires high school students
to take an economics class. Exposure to underlying financial
concepts such as risk management is limited or non-existent for
teenagers, despite the outsized role these concepts play in the
global economy as well as people’s daily lives. That’s a major
reason we joined with industry partners in launching an online
educational resource that has already helped thousands of U.S.
middle and high school teachers explain how futures work in the
financial marketplace.

Our industry needs to take other educational steps along these
lines to put the world of finance on the radar of middle and high
school students. It’s only then that we will earn their attention
before they begin the next chapter of their lives. By focusing at
the grassroots level to communicate the fundamental value we
provide, we will help to restore our industry’s reputation and
attract the financial leaders
of tomorrow.

— Terry Duffy is Chairman and Chief Executive Officer of CME
Group, the world’s largest futures
exchange.