A corporate template in collaborative management for the uncompromising long term interests of its members.

Desjardins Group, Canada's largest financial services cooperative, recently completed a survey of its more than 42,200 employees to see how they felt about the organization's initiatives around corporate social responsibility. The grade: A+.

"Our employees believe in our values and agree with the way we act and how we focus our efforts when it comes to helping the community," says Suzanne Gendron, vice-president, executive services to the CEO and management committee of the Desjardins Group. "Our employees really have a strong feeling of attachment toward Desjardins because of our distinctive model and values."

In fact, while the turnover rate for the financial sector sits at 7.9%, Desjardins Group's turnover rate is just 4.2%. "We share a bond that is very strong, and it is all based on those values and our culture. I have never seen that anywhere else in my career."

That culture starts with the business model and the tenets that have guided that model, established by founder Alphonse Desjardins 110 years ago. Desjardins Group is a pure democracy. Its retail branches are legal entities with their own boards. And its members of which there are now six million -- pay $5 for membership into the co-operative. Each member has one vote at the annual meeting of their branch.

"Members elect the board members of their local branches who are also members--not employees of Desjardins," Ms. Gendron says. "The local boards also elect a president who goes to the regional assembly to decide on regional issues and priorities. These branch presidents elect a president of the regional assembly, who then has a seat on the Desjardins Group board of directors with our CEO. In this way all the decisions we make are always aligned with the values and needs of our members. We belong to our six million members. And this changes the dynamic completely.

It is an inverse pyramid.

In my personal experience, when you work in a publicly traded company, the accountability is to the shareholders. Consequently, the pressures on achieving short-term results is extremely strong. Here we don't have that pressure because we don't have stocks or shareholders. This gives us the ability to develop a long-term vision and realize it. Everyone is working in the best long-term interest of the collective."

This democratic model is supported by the tenets of financial responsibility and education. Throughout its history, Desjardins focus has been the financial health and stability of its clients/members and the communities they call home. "We have existed for 110 years and the goal is that Desjardins will always exist. And that means that we remain financiallystrong," Ms. Gendron says. This past year alone, while other financial institutions required government financial support, Desjardins grew at a sustained pace thanks to its policy of administrative discipline and self-auditing.

"Being owned by our members, it's our responsibility to manage their assets as a parent would. We are here to create sustainable prosperity, and it starts by being financially sound and solid and making sure we move forward in that way," Ms. Gendron says. "We will not take risks just for the sake of having a higher return. This would not be in the long-term interest of our members. It's one of the reasons we came through the financial crisis largely without consequence."

Bottom line: Desjardins Group wants to make sure its members are not just clients to whom it sells products but people it educates to make sure they can manage their own personal finances well. That focus on education started from the beginning, when its founder created the school caisse, a program now running in many elementary schools in Quebec and Ontario. Today more than 1,000 schools have a "branch" that effectively belongs to the students.

"Each week they can make deposits and earn interest and we teach them how to manage their money, so that they are saving and spending within their means," Ms. Gendron says. Desjardins Group also runs a more sophisticated program for high school students and works with universities to promote finance education.

"We try to find as many ways as possible to educate our members. We were one of the last banks to issue credit cards because we were afraid members might take on too much debt. We wanted to educate them so that credit could be a positive tool."

Desjardins Group also leads all other Canadian financial institutions when it comes to giving back and ensuring the wellbeing of communities. Since 2000, the caisses returned over $3.7 billion in member dividends--45.5% of surplus earnings after income taxes. In 2009, Desjardins gave $72.3 million in sponsorships, donations, and scholarships, i.e., 6.7% of surplus earnings after income taxes, versus a 1.34% median ratio for large Canadian companies. ," Ms. Gendron says.

The non-profit Developpement international Desjardins (DID) was recognized as Canada's largest source of specialized expertise in all sectors of international aid by the Canadian International Development Agency (CIDA); members and employees both raised $1-million each in support of Haiti earthquake relief. And its proactive approach to mental health awareness, in particular the work done by its subsidiary, Desjardins Financial Security, in partnership with the Canadian Mental Health Association, was also recognized.

Desjardins Group has also taken a leadership role in helping small towns and First Nations meet their financial needs. In Quebec, 34% of its branches are in municipalities with 2,000 or fewer inhabitants. This compares to just 2.6% for its competitors. "The reason is simple," Ms. Gendron says. "We take a different approach-- there are people who need services, so we will be there to serve them. Go to the most remote parts of Quebec and you will find a Desjardins branch. We don't want to let anybody down."

When it comes to First Nations communities, Desjardins Group has founded five caisses and 36 points of service in aboriginal markets. "We are very close to these remote communities because it is hard for them to have access to services and we serve everybody even if it's going to cost us money," Ms. Gendron says.

The environment also goes hand in hand with Desjardins Group's sustainable prosperity philosophy. For this reason it has developed a sustainable development policy and has launched several initiatives, including: offering energy-efficiency loans to help businesses reduce their greenhouse gas emissions; reducing paper use by 31% and carbon emissions by 490 metric tons enterprise wide; developing an alternative transportation plan by encouraging mass transit use; partnering with Project Climate Canada to raise climate change awareness; joining forces with the David Suzuki Foundation; and signing the Boreal Forest Conservation Framework.

"When you talk to employees and members about Desjardins they have a light in their eyes. They are proud to be part of this organization," Ms. Gendron says. "It's rare when you have an organization where people will gladly contribute their personal time, but that's what our nearly 7,000 elected corporate officers do. They do it for the best interest of the community and their branch. How many organizations have that kind of support from people who are not being paid to be there? These are not employees. There is nothing like Desjardins Group, a company that cares about its people, its members, its communities and the environment. This is not a communications or an image strategy. It is part of our DNA, and it's been here for 110 years. These are our shared values we live on a day-to-day basis and that you can feel in every decision we make."

Mary Teresa Bitti

National Post •

Monday, Feb. 7, 2011

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