Politics

JP Morgan's new policy chief says 10% of 2018 hires at the bank had criminal records

Key Points
  • "We saw last year that 10% of new hires in the U.S. were people with criminal backgrounds," says the president of the new J.P. Morgan PolicyCenter.
  • "We're not lowering our standards," Heather Higginbottom stresses. "We're just going out in a broader way."
  • The PolicyCenter's overall mission builds on the Business Roundtable push that shareholder value should no longer be the main focus for CEOs.
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JP Morgan launches public policy center to advance solutions for economic inclusivity

J.P. Morgan Chase — a leading corporate supporter of removing questions about convictions and arrests from job applications — hired about 2,100 people in the United States with criminal records in 2018, according to the bank.

"We saw last year that 10% of new hires in the U.S. were people with criminal backgrounds," said Heather Higginbottom, president of the J.P. Morgan PolicyCenter, which launched Monday.

Many of the new hires with criminal backgrounds work in entry-levels jobs such as transaction processing, and lending and account services, according to the press release announcing the center and the "second chance" hiring initiative. Those workers were arrested or convicted of low-level crimes, including disorderly conduct, personal drug possession and driving under the influence, the release also said.

"We have 'banned the box' as a firm, which means we've removed the check box asking about criminal backgrounds on an application," Higginbottom said on "Squawk Box." "We have federal regulations that we abide by, of course, and we always want to find the best person for the job. We're not lowering our standards," she said. "We're just going out in a broader way."

"One in 3 Americans has a criminal record," she added. "That record is a barrier to employment."

Additionally, she said, the unemployment rate of people who are actually incarcerated is "five times that of the national unemployment rate." Last month, the U.S. jobless rate dipped to a new half-century low of 3.5%.

Before joining the bank, Higginbottom was chief operating officer of the Care USA nongovernmental humanitarian organization. She also served in the Obama administration as a deputy budget director and a deputy secretary of State.

The overall mission of the J.P. Morgan PolicyCenter builds on the August push by the Business Roundtable that shareholder value should no longer be the main focus for CEOs. Companies, according to the BRT, should strive to invest in employees, deliver value to customers, deal ethically with suppliers and support outside communities. J.P. Morgan chief Jamie Dimon serves as chairman of the BRT, a group of chief executives representing nearly 200 major U.S. corporations.

The idea that companies should do more than just chase profits and should help better society is emerging as a pillar of the new type of capitalism that's being advocated by Democratic candidates for president, including Sen. Elizabeth Warren, and titans of industry outside the BRT such as Salesforce co-founder Marc Benioff. Promoting his new book, "Trailblazer," Benioff told CNBC last week that companies have been too focused on shareholders at the expense of employees, customers and the communities they serve.

Higginbottom said: "Right now, we know that the economy works well for some people and it's not working well for others. We think that business has a role to play in advancing some of the solutions to those problems."

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