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CFPB Report: 2015-MO-C-002 March 4, 2015

The CFPB Can Enhance Its Diversity and Inclusion Efforts

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Appendix B: Scope and Methodology

The overall objective for this audit was to assess the CFPB’s human resources–related activities and other efforts to provide for equal employment opportunities, including equal opportunity for minorities and women to obtain senior management positions, and increase racial, ethnic, and gender diversity in the workforce.

We gained an understanding of the CFPB human resources–related activities covered in this report, which include recruiting and hiring, performance management, promotions and succession planning, EEO complaints, non-EEO complaints, and employee satisfaction surveys, by reviewing relevant CFPB policies and procedures and interviewing OMWI, OEEO, and OHC officials. Throughout the course of the audit, we held more than 30 meetings with CFPB management and human resources–related staff to discuss topics such as key personnel, roles and responsibilities, systems and applications, and policies and procedures.

We identified applicable laws and regulations for each of the human resources–related activities within our scope by compiling a list of relevant laws and regulations cited in the CFPB’s policies and procedures and in communications with CFPB officials. Once we identified the applicable laws for each area, we judgmentally selected one law or regulation per human resources–related activity to test for compliance. We based our judgmental selections on our understanding of the scope of the applicable laws and regulations and selected the law or regulation that provided a framework for agencies in conducting that particular activity. We tested the CFPB’s policies and procedures for compliance with the following laws and regulations:

  • Hiring—title 5, Code of Federal Regulations, part 300
  • Performance management—title 5, Code of Federal Regulations, part 430
  • Promotions—title 5, Code of Federal Regulations, part 335
  • EEO complaints—title 29, Code of Federal Regulations, part 1614
  • Negotiated grievances—title 5, United States Code, section 7121
  • Employee satisfaction surveys—title 5, Code of Federal Regulations, part 250
  • OMWI—title 12, United States Code, section 5452

We did not conduct compliance testing for any laws or regulations related to administrative grievances, as the CFPB established its Open Door and Administrative Grievance Policy in the absence of any legal or regulatory requirements for this particular activity.

In addition, we reviewed relevant CFPB policies and procedures to identify internal controls that may prevent or detect bias or discrimination. We selected 10 internal controls to test for operational effectiveness in the following human resources–related activities: performance management, non-EEO complaints, and EEO complaints.70 For these 10 internal controls, we tested the entire population for 5 controls. For the other 5 controls, the CFPB did not have sufficient documentation to support sample or population testing; thus, we reviewed any documentation the CFPB had related to the controls and obtained statements from officials on how the CFPB performs the selected controls. The results of the internal control testing supported some of the findings in this report.

We collected data from the CFPB associated with each of the human resources–related activities covered in this report, including workforce demographics, hiring, performance management, promotions, EEO complaints, non-EEO complaints, employee satisfaction surveys, and separations. We evaluated the data to ensure that they were reliable for the purposes of our audit. As part of our data reliability evaluation, we observed a CFPB official extract the data provided to us from the CFPB’s system of record for all of the human resources–related activities except for hiring, EEO complaints, and non-EEO complaints. In the case of the hiring data, the CFPB provided screen shots of the queries it used to extract the data, as this data extraction was expected to take an extended amount of time. In the case of both the EEO complaint data and the non-EEO complaint data, the CFPB provided the tracking spreadsheets used to track this information.

With the exception of hiring, survey, EEO complaint, and non-EEO complaint data, all the data that we reviewed are maintained in the U.S. Department of Agriculture’s National Finance Center system. Hiring data are maintained in Treasury’s CareerConnector system, and employee survey data are maintained in an OPM system. EEO and non-EEO complaint data are maintained by the CFPB. To gain an understanding of the National Finance Center system and to confirm that no data reliability issues existed, we reviewed relevant audit reports on the internal controls at the National Finance Center.

In addition, we performed our own data reliability analysis for all the data we used in the audit. Our analysis included reviewing the data for anomalies, such as duplicate entries. After we determined that the data were reliable for the purposes of our audit, we analyzed the data based on gender, race/ethnicity, age, and bargaining-unit status, where possible.

We examined workforce demographics agency-wide and by pay grade. We also compared the workforce demographics data to the ACS data published by the U.S. Census Bureau. We then examined the demographics of the applicants processed during each phase of the CFPB’s hiring process. For performance management, we coordinated with the OIGs of four of the other federal financial regulatory agencies who had received a similar congressional request to use the services of an external consulting firm. The external consulting firm analyzed on an agency-wide basis the CFPB’s FY 2012 and FY 2013 performance ratings by gender, race/ethnicity, and age, as well as by bargaining-unit status. For details on the external consulting firm’s analysis, see appendix E. In addition, we conducted an internal analysis of the performance ratings by division and duty-station location. Finally, we analyzed noncompetitive promotions; EEO complaints; non-EEO complaints; employee satisfaction surveys, which included annual employee, new employee, and exit survey results; and separations.

We assessed the efforts of CFPB management to respond to complaints, employee satisfaction survey results, or other potential indications of bias and to increase diversity in management. We reviewed documentation provided by CFPB officials related to efforts the CFPB has taken since the end of FY 2013 to respond to potential indicators of bias, which included updated policies and procedures, internal CFPB reports, and documentation of relevant training sessions. In addition, we interviewed senior management officials in all six divisions on the efforts that each division has taken to address diversity and inclusion needs as identified through employee satisfaction surveys and the OMWI listening sessions.

We evaluated OMWI’s role and involvement in monitoring (1) the impact of the CFPB’s human resources–related policies on minorities and women and (2) the agency’s efforts to increase diversity in senior management positions. We reviewed documents and conducted interviews with OMWI officials to assess OMWI’s efforts to respond to potential indicators of bias or discrimination, such as complaints, employee satisfaction surveys results, and recommendations made by third parties. We also reviewed documents, conducted interviews, and applied GAO best practices to evaluate OMWI’s efforts to increase diversity and provide diversity training to management and staff. In addition, we reviewed CFPB documents and conducted interviews with OMWI officials to evaluate compliance with applicable sections of the Dodd-Frank Act. Further, we assessed the alignment of OMWI’s policies and procedures with best practices.

We interviewed senior management officials from six divisions to gain an understanding of the CFPB’s challenges in achieving diversity throughout the agency and within senior management. Through these interviews, we sought to gain management’s perspectives on the following:

  • division needs for critical management positions and succession planning, as well as any strategies and programs for enhancing diversity
  • division responses to concerns related to equality, fairness, diversity, and inclusion expressed by participants in OMWI’s listening sessions and through employee satisfaction surveys
  • division interactions with OMWI, the OEEO, and the OHC
  • OMWI’s role and involvement in monitoring the effect of the CFPB’s human resources–related policies on minorities and women

We conducted our audit fieldwork from May 2014 to October 2014. We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objective. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objective.

  • 70. To avoid duplication of effort, we did not test internal controls related to hiring or promotions, as an ongoing OIG evaluation is examining these areas. Additionally, we did not test internal controls related to the administration of and reporting on employee satisfaction surveys, as OPM is the responsible party for implementing these internal controls. Return to text