Holding the executive team accountable: Lessons from Wells Fargo's evolving CSR strategy
By Tom Knowlton and Nadia Gomes
After laying out our framework for successful corporate citizenship, we spent our last two posts outlining the “fundamental” elements of strategy and integration – crucial building blocks upon which an effective citizenship initiative should be built. Now we shift to the remaining two elements that we call “accelerators”: engaged leadership and culture.
Leadership: A Driver for Citizenship
A clear stakeholder-driven strategy and an integrated structure across the company is an important foundation for corporate citizenship. Without these fundamentals, citizenship will lack clear goals and strategies for direction and growth, as well as metrics and accountability for achieving goals, internal buy-in, and content to support clear communications. However, as strong as the strategy and integration may be, impact will be limited without engaged leadership.
Through our work with companies across industries, we have found that senior leaders are increasingly seeking innovative approaches to citizenship.
This interest, coupled with the need for leaders to better understand their crucial role in developing, implementing, and being accountable for citizenship initiatives, takes prominence over the prior demand for a “business case.” As the business case becomes more widely understood, the conversation is starting to shift toward the role and significance of company leaders. Stakeholders are assessing companies based on leaders’ credibility.
Consequently, leaders that are working with an outdated understanding of corporate citizenship rarely spend the time to communicate and build the stakeholder relationships necessary to ensure success.
Leadership is not only critical in informing a comprehensive strategy responsive to stakeholder expectations, it also drives commitment from employees who look for leaders to exemplify the values of the company. It is this employee engagement that is necessary for a citizenship effort to be truly integrated throughout the company. Leaders also play a valuable role in engaging with other stakeholders such as community members and customers.
Through a process that builds trust, leaders should be involved firsthand in understanding expectations and translating them into citizenship goals and business decisions. Leaders that are genuinely engaged should be able to articulate the values of the company to all stakeholders, building credibility, commitment, and sustainability for the citizenship effort, and ultimately, creating a culture for the company that recognizes the importance and value of corporate citizenship:
Building this engagement from leaders is an ongoing process:
When leaders understand and commit to the citizenship effort, and assume active roles in educating and engaging employees and external stakeholders, citizenship starts to become a part of workplace culture. From a standalone strategy, citizenship becomes recognized not as something the company “does,” but something that reflects the company’s very identity - aligning with its values and its way of doing business.
In our next post, we will dive deeper into the aspects of corporate culture that play a role in citizenship success, but for now, here's a closer look at Wells Fargo and its process of engaging leaders across the company as it continually refines its citizenship platform.
Wells Fargo: A CSR Strategy in Action
From its early days serving gold miners on the West Coast to its current status as one of the largest financial services companies in the U.S., Wells Fargo has had a long history of citizenship. As Chairman and CEO John Stumpf states in the company Vision & Values:
“We’re responsible for promoting the long-term economic prosperity and quality of life for everyone in our communities. If they prosper, so do we. There’s never been a thriving bank in a struggling community.”
Leaders at Wells Fargo recognize the importance of building relationships with customers and stakeholders, and Stumpf reinforced those values when he publicly committed to “connecting with community and stakeholders” as one of Wells Fargo’s five, long-term strategic priorities.
More importantly, Stumpf and the Wells Fargo Board of Directors hold the company’s leaders accountable for making progress. Wells Fargo’s Corporate Responsibility Committee of the Board of Directors oversees the company’s policies, programs and strategies regarding social responsibility, including development and reinvestment activities and performance, fair and responsible lending, government relations, support for charitable organizations and environmental issues.
In addition, Stumpf and members of the operating committee regularly meet with key stakeholders, including community leaders, public officials, investors, customers and team members to listen and better understand their concerns. The company then uses that feedback to develop new policies, products and approaches to better serve its customers and communities.
Building a Team of Community Leaders
This culture of leadership and community engagement doesn’t just rest with Stumpf and his executive team – it’s embedded throughout the company’s culture and is fundamental to Wells Fargo’s Vision & Values:
“We expect all of our team members to be community leaders. We need all of them, regardless of rank or title, to be our eyes and ears, to help us identity and decide how Wells Fargo should respond to community needs.”
Wells Fargo has a wide range of mechanisms for engaging and communicating with stakeholders at the enterprise and grassroots level, including 83 Volunteer Chapters, 70 Green Teams and nine Team Member Networks. Further, the company has developed 50 Market Reputation Committees across the country whose members include local business leaders and community relations team members responsible for maintaining relationships with community organizations, activist groups, and other stakeholders, and help Wells Fargo identify opportunities to serve communities more effectively.
Listening to Stakeholders
In addition, Wells Fargo’s Government and Community Relations team manages its long-term partnerships with several national-level organizations, which provide key insights on broad-based and local issues, and partner with the company on initiatives to help solve those concerns. By combining resources, expertise and distribution networks, they are able to greatly expand their impact. The company formally meets with its national partners a few times each year at conferences, community meetings and other forums, and consults informally throughout the year as needed.
For example, when Wells Fargo heard from long-time partner United Way Worldwide and its local affiliates, that there was an increasing need for financial literacy and affordable financial products for underserved populations, they established a new initiative in 2012 to address the concerns.
Today, the organizations are working together to help establish a support network for low- and moderate-income households through local chapters of the United Way in several markets, providing families with financial education, access to safe and effective financial products, and training on how to use them.
It’s a well laid out strategy that targets local communities while keeping its global footprint in clear focus.
Next: A deeper dive into those key aspects of corporate culture that play a role in the success of your CSR strategy.
Successful Corporate Citizenship: Developing an Integrated Structure at Medtronic
Successful Corporate Citizenship: Building an Effective Stakeholder-Led Strategy
Why Strong CSR Programs Don’t Always Lead to Successful Corporate Citizenship