Credit unions need to take a good look in the mirror

By their very nature, credit unions are designed to be close to and reflect their communities. Their cooperative owner-member structure, their democratically elected volunteer leadership, and their reputation for offering products and personal service tailored to individual members’ needs all reflect the philosophy of “people helping people.”

We all know that one of the elements of success in business is being aware of and responding to change. We often talk about the need to adapt to change in the financial services industry in terms of technology or regulation. It is just as important to pay attention and adapt to social and cultural changes in your communities. Our country as a whole is undergoing an enormous demographic shift, and the impact eventually will be felt in every community. Planning for change puts any organization ahead of the game.

S.Halperson 703.838.80988

I often talk about the business case for diversity, which, most simply put, is that it’s a good investment in your credit union’s future. When your membership, your workforce and your leadership reflect the community you serve, your ability to serve expands. Creating a more diverse and inclusive culture in the workplace means you are bringing more points of view to your decision-making process, more experiences to your operations, and more opportunities for growth and, ultimately, success.

We know that diverse, inclusive operations out-perform homogeneous ones. For example, there is a significant body of research showing that businesses that make a priority of creating a more diverse, inclusive workplace see better internal decision making, greater staff motivation, improved customer service, and higher employee retention, all of which lead to better financial performance.

To promote greater diversity and inclusion in your credit union, start by holding up a mirror to your organization. Two years ago, the National Credit Union Administration launched an online diversity self-assessment tool to help credit unions and our agency evaluate diversity, share best practices and assist us with developing guidance. Each year, we ask credit unions to participate in this self-assessment and tell us about the results they find.

This process is based on broad standards that serve as a framework:

• Organizational commitment to diversity and inclusion
• Employment practices related to diversity and inclusion
• Supplier diversity policies and practices
• Transparency of diversity and inclusion practices
• Assessing and monitoring diversity and inclusion practices

As you make your way through the assessment, each of these five standards has a list of best practices that allow you get a clear picture of where you are and a start at mapping out a strategy to greater diversity and inclusion. Although 2018 is only the third year the NCUA has offered this voluntary assessment tool, we already have evidence that it produces concrete results.

For example, the credit unions that participated in each of the first two years reported more affirmative responses the second time they went through the assessment. This tells us that there are critical conversations taking place and that cultures in those credit unions are making positive changes.

I want to stress that participating in this assessment is voluntary, confidential and is not part of the examination process. Therefore, the results of your assessment will have no bearing on your CAMEL rating. Data we collect through your participation will be aggregated and included in the Office of Minority and Women Inclusion’s annual report to Congress.

This year, we have re-designed the assessment to make it easier to use. While Dec. 31 is the deadline for submitting data that we will aggregate and include in our next report to Congress, the NCUA will accept your submissions throughout the year.

I have been heartened by the progress in promoting greater diversity and inclusion in the credit union community in recent years, and I am excited by the fact that we’re only at the beginning. The opportunities for credit unions, their members, and their communities will only increase as more people are brought into the conversation.