How to improve your credit union’s advocacy

Why it’s time to change your approach to annual reporting and impact measurement.

The new year is upon us and, as ever, it presents both challenges and opportunities for credit unions. Chief among these is the process of annual reporting, which, although at times a daunting task, should be top of mind as we head into 2023 with the industry once again—rightly—facing increased pressure to quantify and prove its value to the communities it serves.

Last March, in the middle of CUNA’s Governmental Affairs Conference, a memo sent by the American Bankers Association (ABA) called on Congress to review credit unions’ tax-exempt status and recent changes to field of membership regulations. In particular, the document laments the lack of an “actual requirement that credit unions serve consumers that are most in need,” and claims many institutions no longer “fulfill their intended purpose.”

Of the six specific questions they urged lawmakers to consider and put to credit union representatives, number one on the list read:

How do you track and quantify your success in meeting the needs of your community? How can the public get access to this information?

These are all fair points, and ones that credit unions should both be aware of and prepared to answer moving forward. It was also a shrewd move by the ABA, homing in as it did on a source of difficulty for many institutions—the inability to accurately measure their true impact on members.

The main reason for this reporting deficit is simply that most credit unions lack the financial resources to even attempt to track such metrics. However, another, more fundamental reason is that, far too often, the industry has sought to measure success in ways that don’t align with a credit union’s primary mission—to provide benefits to members.

How credit unions can respond

In addition to serving as an industry-wide wake-up call, the ABA memo further presents a golden opportunity to begin tracking these metrics and ultimately prove the bankers wrong. To do so, credit unions must turn their focus toward advocating for their continued interests and directly address the concerns cited in the memo by tracking the following:

  • The extra money your lawmakers’ constituents have in their pockets by virtue of your credit union’s mere existence;
  • Your credit union’s record of serving your lawmakers’ constituents, especially those residing in rural or economically distressed areas, and additionally how well you are serving their constituents at every income and credit tier;
  • Whether you serve a disproportionately high percentage of racially and/or ethnically diverse populations and, if so, how this diversity fortifies your community.
  • The number of jobs your credit union created or sustained in a particular lawmakers’ district(s);
  • The amount your credit union has contributed to your community’s GDP.

Takeaway: Establishing a new measure of success

Analyzing and benchmarking this data will not only help prove your value to those you serve—it will additionally provide a more accurate overview of your institution’s holistic performance. Through understanding the real impact on members and communities, your credit union will further be much better positioned to facilitate development initiatives, improve DEI efforts, and produce more comprehensive and insightful board reports.

There is no denying this is a delicate moment for credit unions as they are faced with questions concerning their very existence. However, if the ABA has shone light on anything, it is not that credit unions are failing to live up to their purpose, but merely that they have yet to quantify this in statistical terms.

This is why the time is now for credit unions of all sizes to change the way they approach impact measurement and reporting by shifting the focus back to where their missions truly lie—providing benefits to the member.

Sam Brownell

Sam Brownell

Sam has worked in the credit union industry for over ten years. He thinks every American should be a member of a credit union. In 2014, he founded CUCollaborate with ... Web: Details