The Bank of Tomorrow, at the Core of Environmental and Social Issues

On Wednesday July 4^th, I, together with many experts in the field, had the pleasure of participating in a thematic round table discussion on “The Bank of Tomorrow” at the Press Club. What will the role of banking be going forward and what will it have to embrace down the line? How do we go about such a transformation? We tried to answer these very questions and below, you can discover some of the answers for yourself.

At this present time, banks are bracing themselves for the future, primarily through technological innovation: artificial intelligence, blockchain, new channels, etc. The uses and offers of the “classic method” remain valid. The largest part of the transformation focuses on customer and employee relations and does not necessarily involve reinventing the banking business.

Faced with new societal and environmental challenges, this observation raises several questions: what will the new business models of banks be like? How can we strike a balance between the long term and what is required today? What new role can banks play in their own ecosystem?

The energy transition: a must for France, and for all activity sectors

According to Matthieu Auzanneau, economic journalist and director of ‘The Shift Project’, France has a key role to play in the energy transition. The current government says it is ready to take a leadership role on this issue. The Paris agreements were a first step in this direction in an effort to do away with our dependence on fossil fuels within a generation.

However, the challenge is daunting: with the exception of times of severe recession or war, fossil fuel consumption has never declined. This is a real challenge that all stakeholders must consider collectively in order for it to be properly addressed.

Everyone must integrate the energy transition into their business plans, and, far from being a hindrance, consider it as a real strategic opportunity.

A Challenge Linked to French People’s Expectations of Banking

According to Laurence Bedeau, Associate Director of the research firm Elabe, the survey that was conducted in collaboration with Wavestone supports this need to turn to questions of relevance and of contributing to the greater good. 87% of the French respondents to this survey are convinced that banks must act more to improve society.

When it comes to issues such as financial transparency, dependency, illness, energy transition etc. French people’s expectations are high. Furthermore, banking, as a central institution of society, enjoys a certain legitimacy in terms of responding to these expectations. The key to a successful banking relationship will most likely lie in a combination of efficiency and openness.

The Role of Banks in Relation to Regions

Regions will be what emerge as the fruit of globalization. It is therefore crucial that banks consider them when designing their approach. According to Jean-Paul Mazoyer, Chief Executive Officer of Crédit Agricole Pyrenees Gascogne, banks have a role to play with regard to regions and their populations. By virtue of their position, banks will be the most important players when it comes to preparing the future of regional economic actors, particularly when it comes to accompanying them through the various transitions that they face: evidently the energy transition, but also the transition to digital technology, the food transition…

Supporting them in this manner involves proposing new offers and banking products, as well as considering the proximity of advisors within local agencies, and the representation of local authorities in the governance of banks. The transition of banking itself must also be taken into account.

An Increasing Sensitivity of Banks to Social and Ecological Issues

Regardless of a bank’s profiles or organizations, we can see today that there is a convergence of strategic plans taking place in banking, the vast majority of which are set for 2020. These promote aspects such as digitization and operational efficiency, safety, compliance… The matter of proper commitment is only tentatively discussed. However, some meek signals are noticeable. We are witnessing the entry of CSR into the COMEX, an increasingly strong support from leaders for environmental and societal issues as well as for the acceleration of SRI (Socially Responsible Investment).

With a view of moving towards broader action, the challenge for banks will be to involve all stakeholders in the process, which also presents a unique opportunity to align their expectations with those of citizens, of customers and of associates. We are thus witnessing a convergence of the interests of the bank’s various stakeholders both internally and externally.

Redefining Companies’ Missions

Olivier Aubert, President of Temsens, proposes an exploration method to determine banks’ new missions. Bankers must ask themselves: how can we conceive the future with a renewed perspective? What will the banking value system of tomorrow look like?

To answer this question, according to Aubert, four avenues of inquiry can be explored:

• The physical environment- understanding it is essential to visualizing the world of tomorrow.
• The evolution of new technologies and their impact on our environment.
• The evolution of our economic, social and cultural life.
• An anthropological reflection: what is desirable for the individual, for society?

Such an exploratory approach will make it possible to shift the outlook of banks in terms of understanding the challenges and opportunities that may arise for future generations. In doing so, they must rethink their own rationale by realigning it as closely as possible with societal and environmental issues.