“A bank is a place where they lend you an umbrella in fair weather and ask for it back when it begins to rain.”
The financial services industry is largely undifferentiated in customers’ eyes and suffers from low trust levels. According to Forrester’s Consumer Technographics® data, almost half of Canadian, French, and UK online adults who are banking customers think that all banks are the same, and less than half of US banking customers believe large brands such as Bank of America or Capital One are trustworthy. Sustainability offers firms an opportunity to differentiate and attract values-driven customers. Unfortunately, most financial services (finserv) firms don’t see corporate social responsibility (CSR) as a critical business priority and are also less concerned about CSR and climate sustainability risks than other industries.
Corporate Values Can Help Financial Services Firms Differentiate
As part of our sustainable finance research, we looked at how consumers in Europe and North America felt about corporate values in financial services. Our research shows that financial services firms that embrace sustainable business models have an opportunity to win over values-based customers. Finserv executives should be aware that:
- Big banks are usually the least trusted. Across Canada, France, Italy, the UK, and the US, the largest banking brands barely earn the trust of half of banking customers. Some of these banks are trying to have a positive social and environmental impact, but many are also funding big polluters or are still recovering from recent misselling, corruption, or money laundering scandals. Related Forrester research shows why trust is a business imperative and a huge opportunity for those firms that get it right.
- Customers expect their financial services providers to act ethically and honestly. Despite the industry’s history of scandals, most customers still trust their financial services providers to treat them fairly; nearly half want them to contribute to charitable causes. Italian customers have the highest expectations in this respect and UK customers the lowest.
- COVID-19 has brought more focus on corporate values. COVID-19 is influencing consumers’ choice of brands, with consumers more likely to choose companies that help local communities, treat employees well, or are reducing their environmental impact. But it’s not just the Millennials who care about corporate values. In France, for example, older consumers (55–64 years of age) actually care more about sustainability than the younger cohorts.
- Values influence consumers’ choice of financial services provider. Providing employees with fair wages and working conditions and actively supporting environmental causes or local businesses matter most for consumers across the countries that we evaluated. Between a quarter and a third of consumers indicated that these values would influence their choice of a financial services provider. Of course, corporate values on their own are not enough to sway large numbers of customers away from their long-standing providers. Together with great customer experience and advocating for customers, however, they are key to earning customer trust and differentiating from the competition.
You can read our new financial services corporate values infographics for Canada, France, Italy, the UK, and the US to get more regional insights, and be on the lookout for another upcoming Forrester report, which will offer guidance for choosing the right environmental, social, and governance (ESG) reporting and analytics provider to help you on your sustainability journey.