The banking industry is evolving and companies like KeyBank are leading the charge with their focus on responsible banking, citizenship, and operations.
Andrew Watterson is the Head of Sustainability. He joined the team in April 2014. Andrew uses his sustainability and organizational change expertise to lead the bank in the development and execution of a sustainability strategy that positions the bank for growth. In his role, he works with the entire Corporate Responsibility team and bank leadership to help Key balance margin and mission to achieve dependable results. KeyBank is headquartered in Cleveland, Ohio and is one of the 25 largest banks in the United States.
How is Corporate Social Responsibility implemented at KeyBank?
KeyBank took a big step forward by bringing together various departments and putting them all together as one Corporate Responsibility team. The Corporate Responsibility team was formed in 2012 and it included groups focused on philanthropy, community reinvestment, sustainability, and diversity. Being one team enables us to work more efficiently and implement new programs faster.
We are fortunate when it comes to leadership and corporate responsibility. Our team has top-level support with a direct line to the Head of Corporate Responsibility and the Chief of Staff.
Our CEO Beth Mooney is very passionate about the subject and has made it her mission and part of her legacy to build a bank that is socially responsible — one that understands its impact on customers and community. It’s exciting to have her at the top of the house.
How has KeyBank along with other banking and finance institutions responded to sustainability requirements?
For three years now, we have completed reporting for the Carbon Disclosure Project (CDP) and the Global Reporting Initiative (GRI.) Our 2013 CSR report is on our website and it includes the GRI indicators along with our performance.
We’ve done a good job reporting using GRI 3.1, and we’re currently working on restructuring our efforts. Many companies see the value in reporting and are fine tuning their efforts. These types of reports initially were great checklists for determining where we are now and where we want to focus next.
One thing that many banking and finance companies struggle with in regard to reporting is the new concept of materiality. It’s common to focus more on the materiality definition used in regulatory requirements, not sustainability frameworks. We are working to create an understanding that includes both definitions. We don’t want to limit how people think about risk, rather get them to think about opportunity, too. Our focus is on aligning internal stakeholders and helping them to understand that sustainability needs to be integrated into the business process.
As we head into 2015, what do you see as key concerns in corporate social responsibility and sustainability for your industry?
The banking industry is showing up strong on the Corporate Social Responsibility (CSR) radar these days. We are moving beyond the direct impacts and looking both up and down the value chain.
Within the last seven years, we saw an increase in regulatory requirements. With that came a larger focus on the consumer. This developed into an understanding of the importance of our direct and indirect impact on communities.
Community is a core value at KeyBank. We continually give back to communities across the country. Volunteerism is big with us. We have supported our troops with care packages, planted and harvested food for neighborhood garden programs, and worked with local organizations to maintain and preserve historic buildings in the communities we live and work.
Part of helping our communities is also understanding the types of accounts and investments that would serve them best. We’ve developed programs and financial instruments that minimize the usage of payday lenders, provided free financial education, free tax preparation, and loan assist programs, along with financial instruments for investing in a socially responsible manner.
One more area of focus, I’d like to bring up is diversity. . We’re very proud of our Diversity and Inclusion team. They have helped us to measure our impact on communities and thrive at a time when many other banks have not. Diversity is an important aspect of KeyBank’s culture, and the concept of inclusivity comes through loud and clear at Key. A focus on inclusivity means Key has created an environment where everyone can feel comfortable bringing his or her authentic self to work each day. It’s a culture we feel strongly about building and maintaining. We value diversity across the whole value chain. We work closely with minority, women, and veteran owned businesses that supply Key. We also have nine diverse internal KeyBank Networking Groups, or KBNGs, and a Diversity and Inclusion Council, focused on hiring, retaining and promoting diverse talent throughout the enterprise.
Do banks focus on traditional sustainability concerns like energy, waste, and greenhouse gases?
Energy consumption is a pressing concern for us. We track and monitor energy consumption at 900 facilities using online tools for building management. Of those 900 facilities, 200 facilities have a score above 75, out of a possible 100 energy star ranking. Between 2013 and 2014, we installed an additional 250 building management systems and recognized a 12-17% reduction in consumption in 2014. These systems continue to enable us to forecast where we can make additional improvements daily, monthly, and yearly. We are able to track energy savings in real-time. It’s had a tremendous impact, not to mention reducing our CO2 emissions.
Recycling and waste concerns are right next to energy consumption. We track our numbers for recycled paper and waste. We also recycle our electronics. We’re not only looking at our direct operational impacts, we are meeting with Tier 1 and Tier 2 suppliers to determine how they are managing energy, waste, and recycling and then we ask them how their suppliers manage it. I wouldn’t have taken this job if we were only focused on sustainability within our walls. I believe sustainability is much bigger than that.
How does this impact your company’s approach to sustainability in banking, citizenship, and operations? Do consumers understand KeyBank’s mission and approach?
Banking, citizenship, and operations are the three pillars and priorities that encompass the bulk of our corporate social responsibility and sustainability work. All employees, regardless of the team they are on have a role to play in these pillars. We build our initiatives and communications based on these pillars.
Sustainability and corporate social responsibility aren’t simply about driving efficiency within operations. For us, it’s about how we engage employees, citizens, and communities. Based on that, we can determine the best products to bring to market and develop the right programs to serve the needs of our clients.
I know that some consumers get what we’re trying to do. Some love that we have products and services geared toward sustainability like our green auto loan or Key energy programs but I also know that people are at different places along the learning curve. It’s our job to help them along the way. As a relationship bank, we work closely with individuals and businesses to arrive at the best and most sustainable solutions for them.
Where are the opportunities going forward and what practical steps should firms be taking?
Companies need to focus on what matters the most to their company and stakeholders, make sure to include customers and communities. If that isn’t already clear, then they should review and prioritize the list. It’s critical to strengthen the team and if you can, bring CSR under one roof and align it with the top of the enterprise. This will help a great deal when working across silos. At KeyBank, we do our best not to be looking in the rear view mirror. We try to find ways that accelerate our field and industry with regard to sustainability and corporate responsibility. This in turn will drive the success of our customers. Finally, it may seem like a big mountain to climb, but little wins awaken the company to the capabilities and opportunities that drive change. Collect the little wins!
Bio:
Kelly Eisenhardt is Co-Founder and Managing Director at BlueCircle Advisors, an environmental compliance and sustainability consulting and training firm based in Massachusetts (www.bluecircleadvisors.com.) In her role at BlueCircle Advisors, she is responsible for providing business intelligence, strategy and implementation of environmental, social and governance (ESG) risk programs. Her experience aligns well with her client’s needs for technology, compliance, and sustainability expertise by helping companies create and manage their corporate environmental and social responsibility programs.
To contact Kelly Eisenhardt, send emails to kelly.eisenhardt@bluecircleadvisors.com or follow her on Twitter @KelEisenhardt. For more information about BlueCircle Advisors and the company’s products and services, please visit www.bluecircleadvisors.com, on Facebook at BlueCircle Advisors, on Twitter @OurBlueCircle, and on the LinkedIn group at the BlueCircle Advisors group.