More Than Money

Can banks care about more than making money? In this month’s Executive Insight, Peter Rutter, the general manager of community development at Beyond Bank, explains how it’s possible.

As a completely customer-owned bank, Rutter says community is at the centre of Beyond Bank’s mission.

The community development division at the bank was started three years ago and now has a team across Australia dedicated to looking after the bank’s relationships with Not for Profits and community organisations.

Within banking, Beyond Bank offers products and services tailored for organisations, as well as their employees and volunteers.

Outside of that, the bank supports the community through volunteering, grants, sponsorship and education programs.

Innovation is also becoming a greater focus of the bank, and newer initiatives work with entrepreneurs and social enterprises.

In this month’s Executive Insight, Rutter talks about measuring impact, B Corp certification and a cheese factory with a social purpose.

Beyond Bank supports other social businesses through its Community Entrepreneur Program, with grants of up to $50,000. How does the program work?

[We’re] investing in finding entrepreneurs that are creating value in the community, and looking to assist them financially but also through connecting them with other people who can assist them, so the shared workspaces, the venture capitalists, all this ecosystem that supports entrepreneurs.

This has now been in place for two years… previously the Beyond Bank Foundation had been looking into investments that they were making primarily with focus areas around health, environment and education, but a couple of years ago there was a review that said one of the key issues right around the country is actually creating employment, and looking to create alternative paths to employment.

The old days of going through school and getting a job are harder and harder, and in actual fact what now is taking place is that people go through school and then they go through uni and then they get their degree and then in some instances they get multiple degrees without any guarantee of employment, and so we were looking at options where we can assist to be able to help people create their own pathway to employment and really focus on those who are providing benefits back to their community.

That can be done in a number of ways. You can provide benefits to the community through new employment opportunities, the economic benefits that the business might actually bring about, or the social benefit that the business might actually incorporate as well. So for those reasons we run the program now. So far we’ve issued 11 grants in total and those grants really cover a wide variety of different purposes.

Who are some examples of grant recipients?

We had an organisation called Obelisk, which is made up of four young guys out of the University of Newcastle, who have been creating miniature satellites, and these miniature satellites will actually be going up on the Falcon rocket to the space station. They’ve… created these miniature satellites to be able to undertake experiments on the space station, and at the same time they’ve introduced that same technology back into schools so that schools can actually look at the stuff that’s going on in the space station as well – so there’s a connection to education as well as what’s taking place in space, which is terrific.

There was also an organisation called Liftango, which is a ride-sharing business with a difference. The ride-sharing business is not only about getting people who are going to drive to a location hooked up with people who need to go there, it actually works with the organisation or the region that’s actually involved to be able to do a three-way deal. Again the University of Newcastle’s involved, where the rewards for the drivers are actually paid by the university rather than paid by the passengers. So the passengers get free trips, the drivers are rewarded by the university in a whole lot of ways, including there’s some financial benefit to them, and that’s because places like the university don’t need to then spend so much money or new money on infrastructure to be able to handle the quantity of traffic, so there’s benefits to organisation as well as to the driver. In actual fact the University of Newcastle has also allocated the first few rows of parking at their premises for ridesharing. And those [creators] are actually talking to other businesses about how that might work for them, so there’s some big names involved in that.

There was a product in the ACT called Anti Gravity, which is a strip that people attach to railings for balconies… where you can touch it and it’s uncomfortable, but if you put any load on it, if you put your weight on it, it becomes really uncomfortable, and people can’t bear how that feels. And so by putting these strips on railings and balconies they’re looking to help protect kids from climbing up on railings or even at parties or pets that get themselves into strife.

Probably the best example of success we’ve had is Coolamon Cheese, a father-and-son combination who have built a cheese factory in Coolamon, just outside of Wagga in New South Wales. They’ve actually worked with their entire community to be able to develop this cheese factory which will not only sell cheese products and other products from around the region, it’s becoming a major tourist attraction there and bringing people into the town, and they’re also using it for education to be able to teach school kids about the art of making cheese. They opened a couple of weeks ago and they’re already employing 16 locals. And the whole town, who had previously been a bit down on the basis that banks had been leaving them and all sorts of stuff, are… really upbeat about this new business. They’re all behind it and it’s a great example of the community working together to be able to build things that are successful and benefit everybody.

Why does Beyond Bank care about community involvement and support?

That comes back to the purpose, why we exist as an organisation. As a customer-owned bank we don’t have shareholders who we need to pay our profits to. So our profits that our organisation make are actually reinvested back into our customer services and providing really competitive interest rates and low fees and charges and all those things.

And in addition to that we recognise the role we can play in the community by helping community organisations, so we actually also invest profits back into building a stronger community. Over the past seven years we’ve invested more than $16 million back into community partnerships and programs that help make community organisations stronger and help make community organisations better for all of us.

Beyond Bank is the first Australian bank to become a B Corp, in December 2015. Why was certification important?  

Again it’s really aligned to who we are as a business… Our CEO says often that we became a B Corp only 12 months ago, but in reality we’ve been a B Corp almost since the day our organisation was put together, so we care about things like social sustainability as well as environmental sustainability and economic sustainability – they are all issues which drive our business.

The people who work for us – and we have great staff and really high levels of staff satisfaction – the thing that they like about our business and often talk about is the things that our business actually helps to do, for people and for the community. So environmental sustainability, social sustainability and financial sustainability is really at the core of who we are as a business and what really drives us.

Does Beyond Bank measure the social impact of its programs?

It’s really a growing area of interest for us because, in some respects we do and we certainly measure the amount of input. So we know how many organisations we’re partnering with. We know that more than 14,000 community sector employees now bank with us as a result of a salary packing that we provide for the community sector. We know the level of investment that’s been made.

We do measure the degree of impact that we have with the individual community organisations, but that’s a little bit more fragmented in terms of “what does that mean?” Because some of that’s about the quality of programs… the assets or infrastructure that a business now has in order to provide better outcomes for the people who they care about.

So I guess what we haven’t done to this point is condense all of that back down, or distil it back down into, “how do you put a dollar figure to some of those things?” Some of it’s about efficiencies, and we can measure that, some of it’s about revenue generation, and we can measure that, but there’s also a great deal about the specific impact that you’ve had in terms of business outcomes and infrastructure and the quality of programs that have been run that are a little bit more difficult to measure.

What are the benefits of these programs to Beyond Bank as a business?

As a mutual we’re really focused on building mutually beneficial relationships with community organisations, and that’s what we’ve done with more than 3,000 community organisations who now support us with their business. And so this is all a sustainable model in every sense of the word, because we’re providing better community outcomes in terms of a social impact, and certainly looking to do everything we can on the environmental front as well.

But financially these relationships are sustainable. And one of the things that we heard from the community sector loudly is that they find it more difficult to deal with corporates, and the support that corporates give is sometimes described as “sugar hits” where organisations will do something and they’ll support an organisation, but then it’s just for a period of time or just for a specific activity, whereas all of our partnerships are designed to be sustainable and ongoing so that the benefit that’s derived out of this continues.

What initiatives is Beyond Bank looking at for the future?

The other thing that we’ve really concentrated on in terms of adding value to the community sector is gaining a better understanding of who they are and what their challenges and their needs are, and what role we might be able to play going forward.

We know through talking with community organisations on a daily basis that revenue diversity is now a key issue for them, but the government direction has now made it harder to be able to get funding from the government, and if there is funding it’s more hoops. So revenue diversity, their interest in social enterprise and what role a bank like Beyond Bank might actually be able to play with that is [creating] some interesting discussions… at the moment.

Their greater focus on market engagement, for a lot of them, where their primary source of revenue or one of the major sources of revenue has been government, they’ve often built some of their business around ensuring that they’re meeting the needs the government are looking for, rather than being more outward facing and market facing and looking for broader customer engagement.

We’re having a lot of discussions with organisations now that are turning much more to the customer and the clients that they’re looking after in terms of how they run their business. Corporate engagement is certainly taking a higher level of prominence for them, as well as issues like systems efficiencies and integration between their business engines, which incorporate HR, IT, finance, marketing – those sorts of disciplines. And how efficient and effective their engine is within their business.

So we’re working with organisations on understanding that and on what our role may be in the future. So partnering in social enterprise, looking for ways in which we can do even more than what we’ve been doing up until this point in time to assist them with the future, and I think partnerships in social enterprise, and probably shared services, would be two of the key initiatives that we’re looking at now that we really think are going to play a much more active part in the future of the value that Beyond Bank provides the community organisations beyond just the pure banking products and services.