Responsible Banking

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How KeyBank brings consciousness to its industry

By Geoff Campbell and Aleksandra Corwin of Round Table Companies

 

Building on a long-standing commitment to responsible banking, KeyBank is a powerful example of how enlightened business practices align with higher profits—the central premise of Conscious Capitalism.

“Profit and consciousness are not polar opposites,” says Beth E. Mooney, chairman and chief executive officer of KeyCorp. She stresses KeyBank’s focus on helping clients and communities thrive —including balancing “mission and margin”—and ensuring all boats in their wake are rising.

“We believe when our customers do well, we do well,” Mooney said. “When our customers do well, our communities do well. This is the true balance of mission and margin.”

On July 20, 2017, KeyCorp, the parent company of KeyBank, announced second-quarter net income of $393 million—almost $100 million over the previous quarter. More significantly, since 2011, total shareholder return has increased over 140 percent and Key’s stock price has appreciated over 110 percent.

Where KeyBank differs from some others in the industry is in its commitment to the financial wellness of all clients and its providing access for those who’ve traditionally been underserved.

For KeyBank, it’s a conscious choice to create products and services that support its clients’ best interests. That not only means products that do not harm the underserved, such as the KeyBank Plus check-cashing program, but it also means products and services designed to support economic inclusion. For example, through neighborhood centers, customers new or unfamiliar to banking are offered financial products, services, and discounted offers designed for their unique needs. KeyBank allows customers to cash their checks for a low 1.5 percent fee at their nearest branch. No account is needed for check cashing, and every fifth check is cashed free. Participants are eligible to receive five fee-free money orders when they cash their check.

For KeyBank, lifting communities is about economic inclusion and supporting neighborhoods. Earlier this year, KeyBank joined with JumpStart, Inc. to unveil the “KeyBank Business Boost & Build Program, powered by JumpStart” in communities across Ohio and upstate New York. The initiative, funded by a $24 million grant from the KeyBank Foundation, will stimulate economic growth and workforce development by providing support and structure for individuals, entrepreneurs, and small business owners, creating thousands of jobs and preparing students for careers in the growing technology, service, and manufacturing industries.

Helping communities thrive in this manner requires the team approach displayed by KeyBank. That way, all of KeyBank’s 18,000 employees feel the impact of their contributions, even during challenging economic times.

For example, KeyBank’s leadership team was put to the test during the recent financial crisis, but the company emerged stronger. The team felt a strong obligation to improve KeyBank’s performance in the strong headwinds of economic uncertainty.

“If you were going to have a tougher revenue environment, you needed to look at your business model with a more critical eye and ask yourself, ‘What can you do better, different, less costly and create capacity to continue to invest for growth?’” said Mooney.

While some in the industry hunkered down, KeyBank purposefully invested through the downturn—especially in people, process, and capabilities—to help clients and communities thrive.

“For KeyBank, doing the right things the right way was the genesis of our business model,” Mooney said. “KeyBank places a premium on building relationships that put our customers at the center of all we do. We saw, again and again, the value of embracing inclusion, building trust, promoting success, and creating opportunity—an approach that resonated with consumers across the financial spectrum.”

Mooney added that the emphasis on diversity and inclusion is one of KeyBank’s top strategic priorities. KeyBank’s employees are encouraged to bring their authentic selves to work every day. It should be noted that in 2017, KeyBank was named, for the seventh time, to DiversityInc magazine’s “Top 50 Companies for Diversity,” based on excellence in benchmarks for equitable talent development, talent pipelines, CEO and leadership commitment, and supplier diversity.

“Responsible banking means conducting the business of banking with integrity and transparency, and includes the building and offering of products and services, as well as assisting and responding to clients and communities,” Mooney said, adding that the bank is always reviewing and monitoring its practices to make sure they embody the integrity and transparency the bank values.

KeyBank also launched a five-year, $16.5 billion National Community Benefits plan aimed at making transformative investments in the markets where it does business. These investments are being made in specific categories to help neighborhoods and communities thrive, including mortgages, urban and rural small business lending, affordable housing, and philanthropy.

When KeyBank thinks of helping communities thrive, it involves much more than meeting regulatory commitments; it also includes revitalizing communities through lending, investing, and volunteerism. It means modeling fair and equitable banking, and delivering on the bank’s promise of improving the financial literacy of its clients.

KeyBank’s firm commitment considers the needs of all stakeholders, including the environment. Among other things, KeyBank strives to help business owners make their enterprises more sustainable, and supports them in making decisions about energy efficiency and renewable energy.

KeyBank also provides capital for green efforts via its Key4Green platform, which includes a suite of cost-saving products ranging from leases to equipment term loans.

“We are proud of KeyBank’s record as a responsible bank and citizen,” Mooney said.  “But we are even more proud of the quality of our character as a company and the relationships we have built across our 15-state footprint with our clients and our community partners.”