Meet the bank CEO who’s still embracing social impact

Hello and welcome to Modern CEO! I’m Stephanie Mehta, CEO and chief content officer of Mansueto Ventures. Each week, this newsletter explores inclusive approaches to leadership drawn from conversations with executives and entrepreneurs, and from the pages of Inc. and Fast Company. If you received this newsletter from a friend, you can sign up to get it yourself every Monday morning.

In recent years, under pressure from the Trump administration, activist shareholders such as Robby Starbuck, and the 2023 U.S. Supreme Court ruling that struck down affirmative action in college admission policies, many corporations have rolled back their environmental, sustainability, and governance (ESG) and diversity, equity, and inclusion (DEI) initiatives.

While others appear to retreat, Priscilla Sims Brown, president and CEO of Amalgamated Bank, remains committed not only to social impact—Amalgamated is a certified B Corp and says its mission is to be “America’s socially responsible bank”—but to building a big part of the financial institution’s business around it as well. Some 40% of the bank’s lending is climate-related, and one signature program helps low- and moderate-income homeowners finance heat pumps, better roofing, and energy-efficient appliances through their property taxes, often without upfront costs.

“Our leadership has a shared conviction that you can do well by doing good,” she says.

Progressive bank, progressive customers

Under Brown, Amalgamated’s balance sheet has climbed to $9.2 billion from about $6.6 billion when she joined the bank in 2021. The stock price of Amalgamated Financial, the bank’s parent company, has more than doubled, and it’s up 25% this year, outperforming the financial services sector and the S&P 500.

“Under her leadership, the bank [has] achieved remarkable growth while remaining steadfastly committed to its mission,” says Janice Ellig, CEO of Ellig Group, the executive search firm that helped recruit Brown, adding that Brown has struck “a rare and commendable balance.”

Amalgamated’s progressive approach is bolstered by its customers and investors: Founded in 1923 by the Amalgamated Clothing Workers of America, the bank still counts labor unions as clients, along with climate groups, foundations, and advocacy groups. “They like where their money sleeps at night,” Brown says.

Recognizing the risk

Still, Amalgamated understands that its mission puts it at odds with the current climate, and it even spells out the risks in its annual report, which reads: “Our social responsibility positions may have a material adverse effect on our business, financial condition or results of operations,” noting that its positions to “support economic, social, racial and environmental justice,” while consistent with law, may make it a target of government and public scrutiny. Brown concedes that the bank, like many other companies, has revamped the way it talks about topics such as diversity.

“We’ve taken some words off our website, but I wouldn’t say we’ve changed,” she says. “What we’ve done is clarified.” The bank doesn’t have hiring quotas, she emphasizes, but encourages interviewers to include candidates with backgrounds different from that of the hiring manager. “I’m a Black woman,” she says. “I’ve interviewed a lot of people who don’t look like me. And I expect other people to do the same thing.”

Staying quiet vs. speaking out

I asked how she feels about CEOs who have gone quiet on issues of social impact in recent years. She contends that whether they speak out or not, CEOs still need to acknowledge the persisting issues of racial discrimination, income inequality, and climate change.

“It is unrealistic, and a little bit Pollyanna-ish, to think that your business, your employees, the economy, your neighbors, your children are not affected by these matters,” she says. The good news? Companies can actually contribute to solutions. “We believe in the power of financial institutions and their impact on society,” she says. “We believe addressing income inequality will close the wealth gap, and we believe we can do something good about that.”

Where do you take a stand?

Has your company bucked the prevailing trend to stand up for its values? I’d like to hear about how leaders swim against the tide to stand up for their beliefs. Send me your thoughts at [email protected].