Articles

Love Is Not The Four-Letter Word You Associate With Banks.

Some of our big four banks have recently been spending a great deal of shareholders money on the endeavours of their marketing departments to make them ‘loved’. An exercise in utter futility. As a former chief marketing officer of a bank I can tell you first hand that Australians have and never will ‘love’ their banks. And to cap off this pointless waste, you have announcements like the recent one from NAB to announce record profits and mass lay-offs of 6,000 staff in the same sentence. A breathtaking display of complete ignorance of any other stakeholder group than institutional shareholders.

What banking leadership fails to recognise – or simply does not want to acknowledge – is that they serve multiple stakeholders that will never agree on any single success measures or individual initiatives. The profit figures banks announce are not understood and the role and position of banks is not recognised by the broad community, making them soft targets for politicians and the media.

Instead of wasting money of being ‘loved’ banks need to spend their time, money and organisational energy on being respected and acknowledged for the contribution they make to our economy.

In return for their license to operate and government guaranteed status that few other western economies offer to their domestic financial institutions, Australian banks do play an important role. Every second household in the country relies on bank shares somewhere within their superannuation schemes. The franked dividends they pay have become an essential part of retirement incomes.

By controlling our financial system we have insured a robust operating economic model that is highly resilient to global financial impacts that have rocked the rest of the world in recent decades. Millions of people and tens of thousands of businesses rely on the infrastructure and facilities of our banks. Without the credit facilities available and communal risk cover incorporated into them our economic growth and individual cases of economic hardship would be severely impaired.

They do great work in charity, education and employment. Although the latter is becoming questionable if the NAB’s intentions are an indication of the future.

Banks have much to be proud of. But they will never be loved because we are often beholden to them and there is just too much history of poor judgement, arrogance and in isolated occurrences outright criminal activity from them for any form of admiration beyond the highly conditional.

Banks need to educate all stakeholders about the breadth of what they do, the benefits of what they do and the essential role they play as a pillar of the economic and social community they serve. They also need to be a hell of a lot more astute in their communication and more sensitive to the impact of announcements on the multitude of stakeholder groups they impact and who in turn impact their future success. Respect is something that is earned through actions not through advertising.

© Copyright 2017. Red Communication Australia.