The bank in our survey with the best reputation among its own customers is Union Bank, the main operating subsidiary of the $97 billion-asset UnionBanCal in San Francisco.
The West Coast regional has paid special attention to reputation management since 2011, when it conducted its own benchmark study of perceptions held by five key stakeholder groups. (A sixth group, government officials, was added to the bank's 2013 study, which will be conducted this summer and will show executives where they have made progress and where they need more focus.)
When we looked at how the banks in our own survey performed in seven key components to reputation, Union Bank achieved a top-five finish in all but one area: perceptions about products and services. That's perhaps unsurprising, given that the product selection at Union Bank is narrower relative to other institutions in the study. In every other key area, such as governance, performance and leadership, the company garnered high marks from customers. CEO Masashi Oka explains the approach that produced these results.
Q:Who "owns" reputation management at Union Bank, and how do you harmonize the feedback you get from top executives in risk, marketing, business line roles and other areas with a stake in this issue?
We're a very collaborative organization. I consider that a strength that improves how we make our decisions—and our decision outcomes. That applies to reputation; it's everyone's business at Union Bank. Every employee is a reputation ambassador, and this mindset permeates every level of our organization. We all understand that banking is about trust. We all know that building and upholding a reputation is at the heart of our responsibilities. We take it seriously, professionally and personally. And that's really the essence of how we build and protect our reputation.
If you're asking how we approach reputation systemically, well, we sort of do it the same way. Every business unit, every customer-facing area, every key support group gets involved. This includes compliance, risk, corporate social responsibility, communications, marketing, legal and other disciplines. Earning and protecting our reputation is built into our business—our plans, our behavior, our metrics. We monitor and synthesize perceptions and facts. We assess our reputation from all sorts of perspectives. And we take initiatives to build and protect what I consider our greatest asset-customers' opinion of us.
Q:Is reputation viewed differently in the United States than in other markets where your Japanese parent company operates?
Our parent, Mitsubishi UFJ Financial Group, has very publicly and clearly stated its goal to be "the world's most-trusted financial group." And in Japan, customers traditionally have been far and away a bank's most valued constituency. Obviously, we have a fundamental shareholder responsibility as well, but the high priority that our reputation with customers occupies in our corporate culture is something everyone viscerally knows.
I guess it's not surprising that certain tenets of doing banking right span history, geography and cultures. Trust and reputation are the building blocks. They're bound together and they begin with customers. Plus, they're culturally agnostic. I'm not being naive when I say that—sure, different cultural nuances exist, but nevertheless we're all aligned, across all borders, on the fundamental importance of a good reputation. It matters to customers, communities, employees, business partners, regulators and other stakeholders no matter where on the globe you live and work.
Q:Do you worry that anger toward banking hurts public opinion of Union Bank, or do you see it as an opportunity to stand out from the pack?
I'm always telling our colleagues that we should be proud to be bankers—that it's a noble profession and we deserve to hold our heads high. Society couldn't function without responsible banking. It's true that reputational issues and negative public perceptions affect all of us in banking, including those of us who haven't done a thing to deserve it. You just have to control what you can and not worry about what you can't; just keep doing the right thing and know that thoughtful people will figure out the facts.
There's a good reason Union Bank hasn't been a target of public criticism—we don't deserve to be. [We've] managed to avoid a lot of the issues that damaged public trust in other banks. For instance, we didn't get involved in subprime mortgages. The recent backlash against our industry—in large part because of those mortgages—led us to articulate our approach to responsible banking in what we call our "Five Tenets of Responsible Banking." It was a valuable exercise. It's a manifesto stating our belief in responsible lending, financial management, community support, employment, and products and practices. We know these things matter to our customers. They matter to us, too. And this self-examination contributed to our new brand campaign, "Doing Right," a pledge to forthrightness and clarity about how we operate as a bank and behave as bankers.
Of course we can always improve, but this commitment to doing right has guided us for nearly 150 years, and we anticipate it will keep us on course.