Abby Johnson is serious about making Fidelity Investments a harassment-free zone.
This week the Boston mutual fund boss moved her office to the 11th floor of Fidelity’s headquarters to keep a watchful eye on portfolio managers, research analysts, and traders.
In other words, this chief executive wants her problem children close by.
It has been nearly two months since Johnson dumped one of her star fund managers, Gavin Baker, following accusations of sexual harassment of a junior female employee. Soon after, another fund manager departed after allegedly making inappropriate sexual comments.
The high-profile scrutiny of Fidelity’s workplace conditions — particularly on the 11th floor, where these fund managers had worked — represents Johnson’s first public crisis since she took full control of the company from her father, Ned, last year.
The privately held mutual fund firm is famously secretive, a culture shaped by her father, who shunned the press. But so far, Abby Johnson wants not only her employees but the world to know that harassment has no place at Fidelity.
As I’ve written before, it’s a message that she can push like no other as one of the most powerful women in business. If there was ever a chance to retire the old boys club — especially in the male-dominated money management industry — Johnson is our best shot.
After the firings, Johnson sent a minute-long video to the 40,000 employees of Fidelity in which she reminded everyone that “we have no tolerance for any type of harassment.” She went on to explain that allegations will be investigated and appropriate action would be taken.
“This is an extremely important issue for me and the leadership team and one that should be very important to each and every associate,” she said. “I expect when issues occur, associates will raise them, so we can fix them and make sure they don’t happen again.”
Fidelity, I am told, has sought outside advice to examine its culture, bringing in Grace Speights, a partner at Morgan, Lewis & Bockius, a law firm that also runs a consulting practice working with companies on workplace issues.
Then Johnson took the advice and acted on it. She formed a new sexual harassment committee to give employees another way to air concerns. This is not just another arm of human resources; it is a group that cuts across departments, including HR, legal, and senior leaders who employees feel comfortable confiding in.
The committee will review the investigation of every complaint, implement immediate measures while allegations are being substantiated, and work on preventing harassment. Yes, the group has already had its first meeting.
But Fidelity isn’t just sitting back and waiting for complaints. The company has conducted a culture survey with interviews and focus groups across its asset management division, where the recent problems have arisen.
Johnson herself is attending and speaking at several sessions to discuss the survey starting Thursday.
All of this will be followed by mandatory training on sexual harassment by the end of the year, with additional sessions next year. Fidelity plans to roll out such training across the company.
Johnson’s swift actions come as former Fidelity employees have sued the company, alleging gender bias, harassment, or retaliation. Those suits covered periods primarily predating Johnson taking the helm.
Fidelity won one of those cases on Tuesday, when a federal jury in Boston found that a former executive was not pushed out for being a whistle-blower. But at times, the company’s culture seemed the one on trial, with former employee Jackie Lawson describing on the stand how her bosses were “treating me like an animal.”
For Johnson, flagging to the world that Fidelity won’t accept a hostile work environment, especially for women, is more than just doing the right thing. It’s about the bottom line.
In an interview on Bloomberg TV in September, Johnson talked about the need to recruit more women because female customers are asking for them. And with women slated to control half of this country’s wealth by 2020, that means Fidelity needs to be known as a place where women not only want to work but where women want their money managed. Fidelity oversees more than $2 trillion for customers.
Frank Dobbin, a Harvard sociology professor who studies antiharassment policies, lauds Johnson for her aggressive crackdown, from the symbolism of moving her office to setting up a cross-department committee. Dobbin said his research has shown that harassment training is effective because employees often don’t know what harassment is or what to do about it.
When there is training, Dobbin has found that female employees are less likely to quit because one of the big problems with harassment is that women don’t believe the grievance procedure works.
Still, training only goes so far.
“The best way to reduce harassment is to equalize the number of women and men in management, especially in these key player positions like money managers,” he said.
Johnson has long been groomed to run Fidelity, so she does bear some responsibility for the company’s culture, past and present.
But she does get full credit for seizing on how harassment is a problem and then being hell-bent on setting the right tone from the top.