Living 'Off the Grid' Brings New Perspective to SCE FCU Boardroom

So you think your credit union's board is good at planning ahead? What if the board chair had to think about everything, every day, from where the water in his house is going to come from, to what to do if his daughters cross paths with a bear, to how to get a rattlesnake off the front porch?

That is the unique perspective Patrick McCloskey brings to the board of directors of $659 million Southern California Edison Federal Credit Union, based in Irwindale, Calif. McCloskey – also a name partner at the accountancy firm of Gentile, McCloskey & Company in nearby Monrovia, Calif. – has served on the SCE FCU board for the past six years, and recently was elected board chair.

A little more than a year ago, McCloskey, his wife and their two girls (now ages 7 and 9) harkened back to Henry David Thoreau's move to Walden Pond by leaving civilization for a much simpler life in the mountains east of Los Angeles.

"We have lived in the city all our lives. There was a property in the hills north of where we lived that became available, so we bought it," McCloskey recalled. "It is four acres, but it is surrounded by Forest Service land, so feels as if we have 1,000 acres. The nearest neighbor is a mile away."

The couple and their daughters are living "somewhat off the grid," McCloskey joked. "It is not quite as off the grid as I'd like yet… but I'm getting there. I still have electricity but I am working on moving to solar. I can't get rid of the Internet though. My form of off-grid is as a modern businessman who can work from anywhere in the world. But to do that I need a computer."

The McCloskey family has gone back in time in one respect: for water it taps a mountain spring through a 100-year-old pipe, not the municipal supply. They have no natural gas connection and use no propane, opting instead for an electric range. "There's no livestock yet, but we have 70 fruit trees," he reported. "There had been 10 trees and then we planted another 60 in the last year."

Many of the trees produce peaches, nectarines and mangoes. There also are many varieties of cherries. "We took a stab at a vegetable garden, but we need to build better fences to keep out the bears and the deer," he said.

The girls at first told McCloskey he was "ruining their lives," he reported with a laugh. "Now, they love having nature to run around in. They had to learn to be more aware of their surroundings – watch where they are going, don't step on a snake. They came across a huge tarantula the other day, which caused some screaming."

New Perspectives for the Boardroom

Why such an abrupt change? McCloskey said he and his wife decided they wanted to get away from what had become a sedentary lifestyle of sitting around watching TV or looking at tablets. Sometimes, he said, everyone would be off in individual rooms instead of interacting with each other as a family.

"We found ourselves caught up with being in town, and saw this as a way to spend more time together," he said. "We traded in our Mercedes for a tractor. We have no TVs in the house; we get outside and swing on swings, rope ladders and other stuff. The girls now love having their friends from school come visit 'the mountain house,' as they call it."

More importantly, McCloskey continued, living away from city life has taught everyone to be reliant on the family, not just themselves as individuals. "That fits with the credit union philosophy – credit unions look out for other people," he said. "Our neighbor who is a mile away now is a great neighbor, as opposed to before when we didn't know the neighbor who was five feet away."

"Patrick's perspective has become even more focused on the lives of members and he projects a desire to create initiatives that integrate technology with day to day member needs," said Susan Mitchell, CEO of Las Vegas-based consultancy Mitchell, Stankovic and Associates. "I noticed it while facilitating the credit union's recent strategic planning session. He was all about digging deeper on member behavior and looking for ways to enhance the member experience."

McCloskey told Credit Union Journal living off the grid "espouses a spirit of independence and yet involves an increased level of reliance on your family."

"We do rely on each other, but of course we also carry canisters of bear pepper spray when we hike in our hills – I can't say enough about contingency planning!" he added. "I take this philosophy with me to board meetings, where I encourage the CEO and management to bring their individual personalities into play and yet work with the team toward our common goals. I always want to make sure that we consider alternate solutions to solve our problems."

McCloskey added he does not use bear spray in the board meeting, but "I try to get the senior management people to give me their ideas."

"The board has been trained to think strategically, not tell the management team how to run the credit union," he said. "But I ask for a lot more input. That helps us redefine our strategy or set strategy. We think from 10,000 feet, but we need to hear from the people who are down in the weeds. We need to know how they are interpreting our strategy goals. Sometimes it is an eye-opener."

Solar Future

As society turns more toward alternative forms of energy, McCloskey said he wants to see SCE FCU act as a partner for members – from helping them understand solar power and electric cars, to loans to finance purchases.

"If I could find a solar-powered tractor I would be the first to sign up," he said. "Maybe we can run the credit union on solar some day? Perhaps my experiences will influence some future bold initiatives for alternative energy financing. As we sit in board meetings thinking of new ways to get loans, I was thinking we should be encouraging solar loans. We should be doing something that will help the members and help us. We should be ahead of the curve."

All About Trust

Living in the mountains is "all about trust," McCloskey reported. He said this includes trusting that your family and neighbors have your best interests in mind.

"Having that trust is a good feeling and makes you feel safer. Last week my neighbor Tom taught me how to chase a rattlesnake away from our kitchen door by spraying it with a hose. I would have preferred a shotgun, but he is a pacifist."

McCloskey said this is yet another lesson from his experience that translates to his work on the SCE FCU board in that the credit union's members trust the management and board because they know operating a credit union is not all about making money for shareholders. "They know our goal is not to open up a bunch of extra accounts for them or sell them services they don't need. They know we are member-owned and we do what is right for the members."

To reinforce this notion, McCloskey said SCE FCU is "deep" in a project working on communicating the credit union difference to consumers who are not aware of the differences between a credit union and a bank.

"It is fascinating that some people just don't know," he said. "We hired a new marketing person whose job is to communicate that idea. We want her to really differentiate us, rather than just advertise products."

SCE Federal is in the process of creating a promotion centered on its upcoming annual meeting. McCloskey says board and management want to avoid "another dry meeting where 10 people show up."

"We want a big turnout so members can meet the new CEO, meet the staff. We want them to hear us tell them personally how a credit union works – that one person's deposit then is loaned out to their neighbor. They know we are a cheaper alternative, but we want them to know why it is cheaper and how it can help their community."

No More Dictator

Prior to mountain living, McCloskey said he ran the CPA practice from the top down by dictating what he wanted, not working as a team player. Being on the board at SCE FCU the past six years has forced him to become a bit more aware of how others operate, but living in the mountains has really made a difference.

"Being off on our own, we all work together as a family," he said. "There are only two other neighbors, so we don't take them for granted. We have learned we have to be a team and work together. It is not good enough to let things happen, we have to make things happen. Not like living in the city, where things just get taken care of; We have to keep moving forward, be proactive and be prepared."

The lesson McCloskey sees for credit unions? He says instead of CUs accepting what is happening around them, they have to be different and serve their members in a way that is "ever-changing."

"Credit union members today are a lot different from the past, and the banks we compete against are different. Living in the mountains has allowed me to look around and think more, and be aware. We don't want to move the credit union to the mountains, but we want that mentality. Instead of letting regulations take over, we have to think how to still be relevant tomorrow. In the city, I turn on my water and it is always going to be there. In the mountains I have to think about it – a bear might break the pipe. In our credit union we can't just show up for a board meeting, we have to be aware of our surroundings."

SCE FCU recently hired a new CEO, and McCloskey said he already is applying the lessons he has learned to governance. "If you don't keep up a good board-CEO relationship, you don't know if things are on track. You can miss the big things by getting caught up in the details. If we had regraded our fire road last year, it would be easier to get up and down the hill this year. You have to think ahead, plan ahead, look forward."

The other board members at SCE FCU are listening, McCloskey reported. He said he and his fellow directors have changed "quite a bit," including becoming more communicative. "We work well together. There have not been any issues that have surprised us because everyone is more aware and involved."

"This experience has humbled me; I am more willing to admit what I don't know," McCloskey said, adding, "That has allowed other members of the board to admit what they don't know. Having lived up there has accelerated what I didn't know. I had no idea how much I didn't know. Stepping out of your comfort zone really changes your perspective. My girls could be so sassy in the past, but now they are so excited to learn something new every day. Their eyes are so wide open."

The McCloskey family plans to host a board meeting at "the mountain house" in early January.

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