Square, Inc. SQ recently reinforced its stance against racial discrimination by pledging $100 million in a bid to support black and minority-owned businesses, as well as communities in the United States.
The company stated that the investment constitutes 3% of its cash and marketable securities at the end of second-quarter 2020.
Notably, $25 million out of the total committed amount will be used to make deposits in Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) around the United States.
Further, $10 million will be committed to The Keepers Fund, which is sponsored by the National Bankers’ Association.
Moreover, $25 million of the total amount will be invested in The Black Economic Development Fund. This fund is managed by The Local Initiatives Support Coalition to aid Black-led banks and businesses. Meanwhile, the remaining $25 million will be reserved for future investment such as in social impact projects.
Square’s Stance in Rapid Justice
We note that the latest move bodes well for the company as it takes a stand amid strong protests against racial discrimination and economic inequality in the United States.
Square had begun committing deposits to CDFIs and MDIs in communities around the country last year itself.
These new investments by the company are a continuation to support recruitment, aid equality and career opportunities for black as well as minority employees.
The pledge will help Square in winning employee confidence, which in turn augurs well for its office operations and commitment toward the welfare of employees.
Support to Black Community Gains Steam
By committing $100 million toward the support of black and minority communities, Square reaffirms its intention to take a strong stand against racial discrimination.
Apart from Square, PayPal recently pledged $530 million in a bid to support black and minority-owned businesses, as well as communities in the United States.
Moreover, companies like Bank of America and Goldman Sachs have pledged $1 billion and $10 million, respectively, to address economic inequality and promote racial equity.
Also, technology giants including Amazon, Microsoft and International Business Machines have taken aggressive stance against racial discrimination.
Notably, Amazon AMZN and Microsoft MSFT have implemented moratorium on police use of their respective facial recognition software in order to promote racial equity.
Further, International Business Machines Corporation IBM will reportedly no longer sell or develop facial-recognition software in an effort to curb racial discrimination. Moreover, the company has opposed the use of such technology for mass surveillance and racial profiling.
Given the scenario, we believe Square’s latest move is likely to aid its brand reputation.
Currently, Square carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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