A DEI Check-in & Why Credit Unions Still Have a Lot of Work to Do

It’s been a year since credit unions began making a more significant, visible commitment to taking action on diversity, equity and inclusion (DEI) – both from a workplace culture and member service standpoint. So, how are they doing?

I recently had a candid discussion with professionals from two of the many credit unions that have been laser-focused on DEI about how their cooperatives have embraced DEI, the challenges and successes they’ve experienced along the way, and what’s on their future DEI agenda. Kelli Ellsworth Etchison is chief marketing officer and chief diversity officer for the $800 million, Lansing, Mich.-based LAFCU, as well as a member of Michigan’s Black Leadership Advisory Council, a commissioner and secretary for the Dr. Martin Luther King Jr. Commission of Mid-Michigan, and a member of the study committee for the City of East Lansing Independent Police Oversight Commission. Ronna Idzenga is director of development for the $57.5 million, Milwaukie, Ore.-based Cutting Edge Credit Union. Here are some of the most notable takeaways from our conversation.

CUs are taking visible steps to demonstrate their stance on social justice, like ­planning events and ­announcing new holidays, but that’s just the beginning.

It’s easy for a credit union to release a public statement about their commitment to ­anti-racism, consider a variety of cultures when designing their company holiday calendar, or plan a themed day or event around a DEI-related topic. Cutting Edge, for example, joined a number of other Portland-area credit unions in commemorating Juneteenth – a holiday marking the end of slavery in the U.S. that takes place every year on June 19 – by turning it into a paid training and volunteerism day for staff. LAFCU sponsors a local Martin Luther King, Jr. Day event, and this year held a virtual educational event for kids focused on the holiday.

These types of efforts are important first steps in a DEI journey, as they help raise awareness in communities and show the public that a credit union’s leaders are thinking about DEI, but the interactions that take place during and in between the events are what can make the biggest impact.

Awkward, but necessary ­conversations are taking place.

There’s a lot of talking happening at both Cutting Edge and LAFCU around DEI, which is a difficult yet critical part of the process and leads to surprises for both employees and leaders. Idzenga said at Cutting Edge, when leaders asked employees to begin listing their pronouns in their email signature, one staff member asked why. That signaled to leaders that they should have provided an explanation to all staff from the get-go, and not assumed that everyone understood why pronouns matter to the LGBTQ community.

Cutting Edge also held a five-week “Cutting Edge Identity Series” for its 15-person staff over Zoom to create a safe space to discuss ideas around personal values, and what and who the credit union stands for. “Some of the topics were a little tough,” Idzenga said. “We acknowledged that even though we say it’s a safe space, some people might not feel safe, so we just ask that staff feel brave enough to say the wrong thing, or if they misinterpret something and need a little extra time to ­digest some information, that they just be brave about it.”

Etchison’s DEI work at LAFCU began with taking managed groups through what she called “uncomfortable conversations.” These conversations began with the basics, like the meaning of diversity, equity and inclusion, and what it means for the credit union and its community, then moved on to discussions of historical events that led to systemic racism, flaws in the education system’s teaching of Black history, differences in personal experiences based on ethnic background, and race-related issues that are currently relevant in the local community.

“I tell people that it’s hard work, it’s emotional work, because it’s not like a product or service in your credit union that you’re trying to promote or educate people on,” Etchison said.

She shared that some people see the conversations as political and have called them “a Democrat issue.” “I let them know that this work is very political, but it’s not a party issue. It’s a systemic, structural system that has been woven into all of our documents including the Constitution of the United States,” she said. “But it’s not a Democrat issue or a Republican issue, it’s a humanity issue.”

Diversifying a CU’s staff is a long-term goal.

Idzenga admitted that Cutting Edge’s small staff, located in Oregon and Idaho, is not very diverse and that its board members are all white and over 65 (she did note that they are fully on board with the credit union’s DEI initiatives, however). There’s a simple explanation for this lack of diversity: Low turnover. The credit union is now taking steps to diversify its future staff by advertising job openings in places that will be seen by a wide range of candidates, and is in fact looking for a new board member and plans to be “very deliberate” with its selection, Idzenga said.

The bottom line here is that many credit unions desiring a more diverse staff will need to practice patience, especially if their employee retention rate is good – it could take years to see the mix of headshots on that “leadership” web page look the way you want it to.

CUs are considering what message their ads are ­sending to the public.

Cutting Edge used to feature images of its staff in marketing materials, which Idzenga said was “kind of fun and quirky, especially if you’re a member and you know the staff,” but since those images were mainly of whites, the credit union decided to nix the photos last year and start being more intentional with its marketing imagery.

So, even if a practice your credit union has in place worked in the past, and may still work in some ways in the present, it’s worth evaluating to determine whether it’s representative of your commitment to DEI.

Products and services ­developed with marginalized groups in mind can have real impact.

LAFCU is currently revamping its financial literacy program to specifically help underserved communities, and is looking at leveraging nontraditional credit scoring models to assist people who are typically turned down for loans because of their poor credit – and hopefully prevent them from having to go to payday lenders. Meanwhile, Cutting Edge is preparing to launch voice command banking to better assist its blind and visually impaired members.

These are just a few examples of services credit unions are developing that can make an immediate impact and prove their commitment to making access to financial services easier for groups that have traditionally felt left behind.

Who you partner with plays a role in your DEI journey, too.

As part of my cybersecurity story for this print issue, I wrote about how credit unions are only as ­secure as their weakest vendor link. Well, you could say the same when it comes to DEI – hiring or partnering with a third-party whose practices or values do not align with your DEI goals can set your organization back. Cutting Edge, for example, has been focusing on making socially responsible investments and recently moved its 401(k)s to a B Corp. “The people we do business with are just as important to us as our own way of doing business,” Idzenga said.

The industry is still nowhere near where it should be.

“The credit union industry has a lot of work to do,” Etchison said. “I can probably count on one hand the number of African-American CEOs in the credit union space. You might see more Latinx CEOs as you get into the Southwest market, but as a whole, there’s a lot of work to be done. When I go to conferences, I don’t see a lot of people that look like me in this industry. And I’ve been in this industry a long time.”

Almost 40 years, in fact. Etchison got her start in credit unions in the 1980s at age 19, when she was hired by a credit union in Lansing that – and this demonstrates how slowly DEI has progressed in the industry – had a partnership with the local Urban League and a mission to hire minority talent. “So here we are, almost four decades later and we’ve come full circle,” she said. “We’re still having to do that work and have that conversation about [DEI] and how to do it well in the industry.”

Credit unions have made big strides on the DEI front in the past year, forming groups like the CU DEI Collective, creating executive-level positions focused solely on DEI strategy and facilitating difficult conversations on the topic. But until real change is reflected in the makeup of leadership industry-wide, they can’t afford to take a pause – not even a brief one.

Natasha Chilingerian is executive editor for CU Times. She can be reached at nchilingerian@cutimes.com.