Gerald Smith, chairman and CEO of Houston-based Smith Graham & Co. Investment Advisors L.P., says his firm is already benefiting from a new federal law that’s helping minority and women contractors land deals with regulators of the nation’s financial system.
The law allowed Smith’s firm, (No. 7 on the BE ASSET MANAGERS list with nearly $5 billion in assets under management), to land a contract last fall to provide advisory services to the U.S. Treasury Department, Smith says. Smith Graham, through a partnership with Boston-based State Street Global, is advising the Treasury on the management of about $150 billion in mortgage-backed securities, Smith says. “Our goal is to spend more time in Washington and work with these offices, bring more business to the firm, create new opportunities and show them our value added proposition,” he says.
The Treasury is among about 30 agencies that oversee the financial system, including the Federal Reserve, the Federal Deposit Insurance Corp. and the Securities and Exchange Commission, required by the Dodd-Frank Wall Sreet Reform and Consumer Protection Act (signed into law by President Obama last July) to open an Office of Minority and Women Inclusion (OMWI). The offices are charged with tracking diversity within and the pool of contractors who sell the government goods and services.
William Michael Cunningham, social investment adviser at Creative Investment Research Inc., a Washington, D.C., firm specializing in minority banking, estimates the new law could bring at least $136 million in new contract opportunities for women and minority firms.
But the law also has some skeptical observers. Among their concerns: Will the covered agencies actually be held “accountable” to comply with the law, and will it foster a quota system that could discriminate against firms not minority or women owned?
Joset B. Wright, president of the New York-based National Minority Supplier Development Council, one of the nation’s top business member groups, described the intent of the Frank-Dodd Act as “laudable.” Read complete story at Black Enterprise