Netflix “2% cash holdings to the black community”

Netflix has announced that it will allocate 2% of its cash holdings to financial institutions or organizations that support the African American community in the future as part of its racial fairness effort. At first, it is said to be over 100 million dollars. Netflix CEO Reed Hastings and his wife have already donated $120 million to black universities.

According to the Federal Reserve, 19% of black families have no or negative assets at all. This is more than twice the rate of white families. In addition, according to the Federal Deposit Insurance Corporation, bank assets owned by black people are 1% of all bank assets in the United States. These banks have been working for decades to improve their communities, but they are said to be at a disadvantage due to lack of capital. For this reason, Netflix has decided to make an effort to raise capital for the black community.

As a first step, $25 million out of the $100 million is funded by the newly established Black Economic Development Initiative. The fund invests in black financial institutions in the United States or black community development companies in the United States run by the Local Initiatives Support Corporation (LISC), a non-profit organization with a track record of developing low-investment communities and serving low-income communities.

In addition, $10 million is used to promote economic opportunities for underserved communities in the southern United States through the Hope Credit Union, which works to bridge the innate gap in race, gender, place of birth, and wealth.

Netflix initially gave a clue that the money to invest in this plan was $100 million, but it is expressed as 2% of its cash reserves, which will provide more money as Netflix grows in the future. Netflix is appealing that it would like other companies to do the same. According to Netflix calculations, if all of the stock index S&P500 companies do the same, 1% of their cash holdings ranges from $20 billion to $30 billion. It can be used for a prosperous black community and a fairer future. Related information can be found here .