When the annual Spring BB&T Financial Foundations blog contest came around, Cecilia Kellar, a Personal Finance teacher at Odessa High, enthusiastically encouraged her students to participate. Cecilia uses the BB&T Financial Foundations digital course as a supplemental tool for her in-class curriculum. “The blog contest gives students the opportunity to voice how [the program] has affected them and for them to talk about personal finance,” she said. Little did Cecilia know, one of her own students, Ismael Lujan, would place among the contest winners.
Teachers like Cecilia have leveraged the contest to give students the opportunity to showcase what they’ve learned and, in some cases, receive credit toward their final grade. The contest also comes with a monetary prize for the first, second, and third place winners.
The Spring 2017 blog contest saw over 288 student entries from high schoolers across five states. Learners of all ages submitted their posts, and a number of common themes arose. Saving for college and financing higher education – a topic that is top of mind for many high schoolers across the United States – was the most popular. Many students also wrote about debt and credit. Across the board, entries displayed a wealth of knowledge gain and expressing a desire to apply the information they learned through the course to their daily lives.
So what did the winners have to say?
FIRST PLACE WINNER
Angelina Neely, Downingtown S.T.E.M. Academy
“The BB&T Financial Foundations program has helped me plan for my future and allowed me to take the first steps in reaching my lifelong goals without several financial problems. The first step is receiving a higher education. The BB&T Financial Foundations program has started dialogue in my family about the finances available to me for school. I have been searching for scholarships as well as putting a certain amount away in my savings to hopefully decrease the amount of student loans I will need to take out. I now understand all the necessary steps and documents needed to make my financial college experience as simple as possible. Looking past college, the BB&T Financial Foundations program has also prepared me to receive my dream job.”
Caroline Clapp, Chatham Charter School
“Through the BB&T Financial Foundations Program, I have become aware of many ways to grow my money. I have wanted to see the world for as long as I can remember, but I had never taken into consideration how expensive it is to travel. I recently realized my goals were costly and I probably would not be able to afford to travel, so I was disappointed. After completing all nine modules, I now understand it is going to take more than just keeping my money in a checking account if I want to travel the world. I have since invested all my savings into a diversified investment portfolio. A portion of the money I make from investing will go towards my dream to travel. The rest will go towards other important things like college and my retirement plan. I’m only sixteen, but the BB&T Financial Foundations Program taught me that I can never start saving too early because the longer my money is invested, the more it will grow.”
Ismael Lujan, Odessa High School
“Learning with the BB&T Financial Foundations program’s concepts and lessons has made it simple for me to understand how to stay on track and reach my goals while also saving money and still having fun and being happy. The BB&T Financial Foundations program really opens your eyes to the truth and reality that is money. For instance, I never thought of money being a tool, and it is a very powerful tool which we can all use to our advantage. This program has really showed the more intellectual side of handling and saving money. I can safely say that I view the world a little more differently now, but the most important lesson it has taught me is that it is important to save and plan ahead, only use what you need.”
This July, EVERFI’s Financial Capability Network had another intimate invite-only event that convened a diverse set of industry leaders to discuss strategies and best practices for improving the financial capability of people of all ages. The event took place in San Diego, CA, and featured keynotes by Gov. Frank Keating and the former CEO of the Financial Services Roundtable Steve Bartlett.
- Relationships aren’t just the “biggest thing” that matters, they are the ONLY thing! We spent time talking about relationships with customers, with community, and even with your CRA regulator. Furthermore, there was definitely some bonding between attendees. These industry-peer relationships – most of whom do not often get to share ideas – became immediately valuable.
- Community = Business Growth. For some reason, Community Development sometimes lives in its own corner of financial institutions, and is not seen as critical to the growth of the institution. This does not make sense. Community Development is part of that growth, and investments in community are investments in a financial institution’s future.
- The power of the Network. Many financial institutions are tackling difficult problems all on their own. If we work together as an industry, it is obvious that we can accomplish so much more. The whole is so much greater than the sum of the parts.
A study by PwC business consulting firm Strategy & found that the world’s largest publicly held companies have been terminating CEOs more frequently for ethical lapses. Globally, the years 2012-2016 saw a 36% increase over 2007-2011 in CEO misconduct-related terminations.
The larger the company, the more likely a CEO would be fired for ethical lapses (from a rate of 7.8% of all dismissals in the largest quartile of market share, to a rate of 3.2% in the smallest, in 2012-2016).
Examples of Ethical Lapses
Ethical lapses don’t necessarily signal that leaders or companies lack integrity as whole, but they do indicate serious and harmful errors in ethical judgment. Examples of ethical lapses include business-related misconduct such as fraud, bribery, insider trading, and environmental disasters involving negligence or recklessness.
They also include personal ethical misconduct, such as inflated résumés and sexual indiscretions. (We’ll zero-in on the economic consequences of personal misconduct in Part II of this series.)
Increased Accountability for CEOs
As the study’s authors are quick to point out, this does not necessarily mean that CEOs are less ethical now than they were in the past:
Our data cannot show — and perhaps no data could — whether there’s more wrongdoing at large corporations today than in the past. However, we doubt that’s the case . . . our data shows that companies are continuing to improve both their processes for choosing and replacing CEOs and their leadership governance practices — especially in developed countries.
What it does mean is that boards of directors hold CEOs more accountable now, largely due to these 21st century factors:
- Increased public suspicion of corporate behavior;
- The amplifying effects of the 24/7 news cycle and of wrongdoing’s digital footprint on social media;
- Increased legislative, regulatory, and enforcement actions; and
- Greater global exposure to supply chain and emerging market-related risks.
All of this points to what the study’s authors call “a sea change in accountability” over the last 15 years. In the late 20th century, by contrast, corporate misconduct almost never resulted in CEO turnover: “criminal prosecutions of corporate officers were extremely rare . . . financial penalties tended to be modest . . . and media attention was often limited to the business press,” the study’s authors observe.
Systemic Recommendations for Ethical Leadership
The study concludes with systemic recommendations for ethical leadership. After all, CEOs don’t turn “bad” in a vacuum. They are both influencers in, and influenced by, the social and corporate cultural circles they are part of.
So, the recommendations focus on what leaders can do on a company-wide level to avoid unethical behavior by any employee and by the corporation itself:
1. “Organizational and external influences.”
Social pressures such as unrealistic performance targets create bigger problems than financial incentives. Leaders should make sure that they have appropriate structural checks on misconduct. This includes an open-door policy that encourages employee dialogue about both good and bad news (such as difficulty meeting targets). That way, problems can come to light before they turn into ethical lapses.
2. “Business processes.”
Minimize opportunities for bad behavior by assessing your company’s risk exposure, by shoring up compliance programs for effectiveness, and by ensuring that employees have ways to report misconduct and know how to do so. [Our research shows that employers should give workers multiple avenues for internal reporting, not just a whistleblower hotline.]
3. “Individual ethical decision making.”
People convince themselves to act unethically by telling themselves that it’s okay to break the rules (rationalization). Leaders who seem to implicitly or explicitly condone rule-breaking influence company culture and make it easier for employees to rationalize cutting corners themselves.
Ethical leaders should clearly and effectively communicate their company’s ethics and compliance policies through employee training. They should drive ethical engagement from the top by example (including by holding themselves accountable and admitting mistakes) and seek out expert guidance when facing ethical dilemmas.
In addition to these recommendations, I would add that ethical managers value evidence over opinion (expert or otherwise) in assessing whether their company’s ethics and compliance program is working. Although it’s human nature to hold our own opinions in high esteem, doing so often leads to ethical lapses. Ethical leaders rely on the facts first.
Note: This is Part I of a three-part series on the consequences of leadership misconduct. Part II will examine the economic impact of personal indiscretions by corporate leaders. Part III will wrap up by looking at situations in which leaders and workers are more likely to cheat, through the lens of recent enforcement actions and empirical data.
Ethics and Compliance Training for Leadership
EVERFI delivers online training to help your business meet compliance requirements both dynamically and scalably. In addition to our award-winning online courses, EVERFI delivers a robust, cloud-based learning management system to help you easily deploy and track our growing library of compliance training courses, including code of conduct and ethics, anti-harassment, data security, and much more.
Technology has changed the way financial institutions interact with consumers. Over the years, in-store visits to banks have decreased from more than two dozen to roughly three visits per year. This trend encourages financial institutions like yours to find innovative ways to stay in touch with the consumers who’ve embraced the digital age. This means it’s more important than ever for your financial institution to implement a digital marketing strategy.
How to Start the Digital Conversation
The digital age allows your financial institutions to stay in constant communication with consumers. In order to create a strong presence, your financial institutions must use content to establish expertise with your targeted audience. Consumers want to receive insights, increase their knowledge on financial literacy, attend webinars; read blogs and case studies. If you work on getting started with one of these digital marketing techniques you will create trust between your financial institution and the consumer.
Digital marketing would also allow your financial institutions to set measurable goals and find ways to successfully achieve those goals. After getting buy in from executives and setting measurable goals it’s time to build the foundation and start executing your plans by:
- Reaching Your Audience
There are plenty of channels that your financial institution can use to reach your targeted audience. Some of those channels include email marketing, website marketing, mobile marketing, social media marketing, paid social media, and blogging. Choosing one or two to get started with will enable you to reach more of your consumers.
- Driving Engagement with Financial Education
Engaging with your audience through of financial education has a lot of benefits. Not only can your financial institution show off their expertise, but also your company can learn about their target audience and take them on a new journey with your financial institution.
- Tracking & Maintaining Engagement
Once your financial institution has engaged with your targeted audience, it is important to track and maintain the results. By doing so, this allows your financial institution to pull insights, create data and find new ways how to interact with your new targeted audience.
To learn more about digital marketing and best practices join us for our upcoming webinar on July 20th 1PM EST on The Ultimate Guide to Digital Marketing. If you can’t join us for the webinar check out the guidebooks that started it all, The Ultimate Guide to Financial Digital Marketing.
The Treasury Department has given financial institutions an indication of what may change for the Community Reinvestment Act (CRA) under the Trump administration. Considering firms have not seen this level of proposed change to the CRA in a while, it suggests the Treasury Department (“Department”) is serious.
In an extensive report, Secretary Mnuchin describes the status quo of banks, their problems, and possible solutions. Updating the CRA is one solution that can be a “response to the real risks that American consumers and the American economy face.” While this report is not official, meaning it doesn’t change any laws or guidance, it provides touch-points that banks should already be on top of: streamlining examinations, leveraging technology and impact, and how banks can prepare.
The Department plans to change how regulators examine banks. The long stretches of time between bank examinations constrains banks’ abilities to grow, i.e., mergers and branch openings. Additionally, the standards and processes used by different regulators are not fully aligned. They are also outdated. Interagency guidance about the CRA, published in 2016, recognizes that technology can be a factor in evaluating retail banking services, and indicates that the agencies will consider “new methods as technology evolves.”
As a result, the Department seeks “improvement in the regulatory review and rating assessment process, which would consider the frequency of examinations, the ability of institutions to remediate ratings, and the transparency of how the overall CRA assessment rating is determined.”
Technology and Impact
Examinations should better consider technology as banks increasingly “use technology, such as automated and online offerings, to extend services outside of physical branches,” according to the Department. Particularly, the Department would like to consider assessment areas in communities based on “the changing nature of technology.”
Measurement of impact will be more of a factor as well. This is a sign that impact should not just be relegated to particular zip codes, counties, or areas. It should cross state and local borders. “While all three prudential regulators are involved in checking CRA compliance, none are responsible for evaluating how well the CRA accomplishes its mission.” This is a problem, as guidance indicates that “assessments will depend on the impact of a particular activity on community needs and the benefits received by a community.” Indeed, firms can get additional CRA credit for showing impact. This is likely why the Treasury Department wants CRA investments to be “measured to improve their benefit to communities.” If firms are not measuring the impact of their community development efforts, they should be.
It is unclear how fast the Department will move, as it may wait for approval by the President. At least, the Department “will include soliciting input from individual consumer advocates and other stakeholders.” So while the CRA will generally stay the same for the time being, EY warns the banking industry that uncertainty is no excuse for inaction. It suggests that banks “harness and embrace technology to meaningfully reduce costs and risks and improve agility.” Better yet, banks that incorporate responsible technology into their CRA programs can also help bring fintech, and their products, to the masses.
As the baby boomer population quickly becomes the largest senior demographic in American history, it is increasingly difficult for them to keep keeping their hard-earned investments safe. One study says that over $36 billion – with a “b” – is lost each year by preying on seniors. And there are certainly plenty of scams out there targeting the elderly: roofing scams, Medicare scams, tech support scams, and scams for reverse mortgages. Shockingly, allegedly half of the financial abuse targeting the elderly comes from within a senior’s own family. This type of preying on the elderly is known as “elder financial abuse,” and financial institutions are on the front lines to help make a dent in this growing problem.
Certainly financial institutions already deal with this problem, especially within the branch. Sometimes a bank or credit union teller needs to expand their role and act as a social worker, family counselor, and banker all in one. But this is a lot to ask of a front-line teller. Furthermore, the regulatory landscape in this space is changing, and as awareness of senior scams increases, so will regulatory pressure on financial institutions.
Employees of financial institutions need help.
Furthermore, boomers and their caregivers also need help. There are literally call centers out there that systematically target seniors on the phone to scam them. If one person does not fall for the scam, the call center just hangs up and calls the next victim. It is disgusting, but unfortunately works. They prey on the uninformed. That’s why education and awareness about common scams, and how to handle them, can help shut these call centers down.
Family members of the elderly also need help. They need to know how to navigate very tricky questions about who manages parents’ finances over time. They need to know what to watch out for. And again: since half of the abuse happens within the family, families need to know what to do in those extremely embarrassing and difficult situations where the problem is not an external scammer, but inside the family itself.
While not the only strategy to help combat elder financial abuse, education and awareness is a big part of the solution. And financial institutions – as a pillar of the local community they serve – can be a trusted source of this education. FIs need help in order to help.
As the baby boomers age, the problem of financial elder abuse is not going to go away. For banks and credit unions that want to protect their customers, the time to take active steps is now. For more information on how to create a program to prevent financial elder abuse, please request a demo.
Today we’re featuring a guest post from elementary student Natalie who earned her Vault – Understanding Money certification this spring. Natalie shares how the Vault program started out as just an assignment, but quickly became a valuable learning experience for her future. Congrats to Natalie for being one of our scholarship recipients!
Teacher: Ms. Caterina
School: Mammoth Heights Elementary School
Sponsor: Colorado Office of the Attorney General
My name is Natalie and I am 12 years old. EVERFI’s Vault was a life changer for me. I learned so much and had so much fun doing it! It took me a while, but it was worth it. I learned so much within the six lessons, but learned the most out of Responsible Money Choices, Income and Careers , and Planning and Money Management. At first I started out doing it for an assignment and ended up doing it for fun.
The first world within the program was about Responsible Money Choices. When I was about 10 or 11 years old, I started a savings account. I would earn the money and go to the bank to deliver it straight into my savings account. I stopped after a while as I yearned to go the mall or movies with my friends. I ended up almost using all my money except for the money in my savings account. When I started the Responsible Money Choices lesson on EVERFI, I started feeling guilty and ended up putting money in my savings account again. I keep a little money in my wallet for things I really need but the rest of my money goes in the savings account. I learned that having a savings account is an important thing and money isn’t meant to be wasted. I should also save my money now so that I can have it for the future. Such as college, or maybe even my career. I hope I never use all my money up again for silly things.
When I was done with the first world I was excited to see what was next. It ended up being the Income and Careers lesson. At first I didn’t know what income was, but as I continued through that activity’s lessons I learned that it is hard earned money through a career. A career is usually a passion that is turned into something that will be happening for the rest of a life. I first started out bored and confused but ended up learning that income is very important and is not just about making money. It is about making money and having fun doing it.
In the third lesson, Planning and Money Management, I learned so much. I have a very big structured brain, which means that I am very organized. Planning is a big part of your future. With my organized brain I am sure that I can take my knowledge to the next level. I can think about my money. I learned that it is the best time when you are around my age to start saving up and stop spending. That is why I started a savings account. It helps my organized brain think. I also learned that it can be so confusing to do taxes and checks. As I got deeper into Vault, I learned that can be quite simple.
EVERFI is such an amazing and really helpful tool. It helped me through some tough times. I hope everyone around the world uses EVERFI’s Vault. It may start out as an assignment, but will for sure turn out as a thing to do for fun. It brings learning up a notch and is very helpful for teachers. EVERFI is a life changer.
At EVERFI, we know our best STEM advocates are our educators.
Today we’re featuring Ms. Scarfogliero, a science teacher at PS/IS 109 Glenwood Academy of Science and Technology in New York.
How do you implement EVERFI’s resources in your classroom?
I implement EVERFI’s resources in my classroom through the Future Goals – Hockey Scholar program. This is my second year using the program in my 8th grade science classes. Before Hockey Scholar, most of my students were unfamiliar with the game of hockey, and the entire program was a new experience for them. My students loved it! They obtain a great deal of STEM knowledge in each module and love competing to win trophies.
Why do you use EVERFI’s resources?
I continue to use EVERFI’s resources to increase student motivation and engagement. Students are exposed to real life experiences and observe first hand the connection between science and sports. My students are always motivated to use the program to learn new content. I like the ease of use EVERFI’s programs and differentiation the program adds to my classroom. Hockey Scholar is easily accessible to all types of learners.
How do you think technology will change education over the next 10 years?
I feel technology is the largest area for growth in education today. Students are always on their phones or computers; we should harness that level of engagement and interaction into academic success. EVERFI’s partnership has offered both a beneficial technology and additional interactive STEM component to my science classroom. This partnership has also made a positive impact on my pedagogy. Technology fuels student excitement and successfully differentiates instruction. Using the program to explore science, technology, engineering and math topics has helped my students to think critically, design, collaborate, problem solve, use the scientific method and learn about the engineering process. I am motivated everyday to see my students explore new concepts and be passionate about science.
What impact have these programs had on your classroom?
Over the past two years using the program, I have seen improvement in student motivation and understanding of many topics, including physical science topics such as force and motion. The program has also exposed my students to different fields of science and sports as well as possible future career paths. Thank you for offering such a beneficial teaching tool!
Thank YOU, Ms. Scarfogliero!
PS/IS 109 Glenwood Academy of Science and Technology
Today we’re featuring a guest post from student Miranda who shares her experience with EverFi – Financial Literacy and how she believes the program has helped her better prepare for life after high school. Congrats to Miranda for being one of our scholarship recipients!
Teacher: Mr. Keller
School: Oliver Wendell Holmes High School
Sponsor: MassMutual Foundation
There is no such thing as being 100 percent prepared for anything in life. In school we are taught how to write better, solve math problems quicker, and memorize scientific and historical facts longer, but we are never directly taught how to do important fundamentals of life. Often times I have heard stories from my friends who wish they would have known this or didn’t find out until it was too late, and it has made me wonder why aren’t students informed sooner? I believe the reason people are unsuccessful in their finances is not because they failed to prepare themselves for future circumstances, but rather they simply were not given the tools to know for themselves. EVERFI is the tool that can and does help numerous students transition securely into their new financial circumstances. The three topics I believe will help me directly after high school are higher education, credit scores, and investing. By understanding these three topics better, I feel more prepared and assured in myself to increase my financial stability for the future.
Learning about higher education, credit scores, and investing through EVERFI has settled some of my financial worries by exposing me to various paths and helping me to choose the best ones for me. The higher education portion of the module has made me feel better prepared on how to pay for college. Understanding how my FAFSA provides a personalized limit on money I can use toward college, how filing for subsidized loans is a better choice, and how to get more grant and scholarship opportunities has benefited me in organizing a suitable way to pay for college. This section taught me how to handle my payments and debts for college in a way so that once I graduate, I will not feel overwhelmed or stressed like many other graduates often do.
Before using the module I didn’t know the advantages and disadvantages of having a credit card nor how it could effect my credit scores. I will now be encouraged to pay my future credit bills on time so that credit lenders will know I am dependable; furthermore, making me eligible to receive loans in the future. The investment section taught me how it’s better to prepare for situations that are years ahead rather than months away. I’ve learned that bonds are loans to business and are safer choices than stocks where the profit I earn fluctuates along with success of that particular business. I now know undoubtedly by saving more today I can enjoy the benefits tomorrow .
I appreciate this module for teaching myself, alongside many other users, how to not be afraid of our future responsibilities. I believe that the reason so many people stress over their finances is because they don’t know what to expect. This module may not take care of all of the financial burdens people face, but it does help to educate and prepare them for when situations arise.
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