Speaking Out for CUs

In an era of changing financial landscapes, political advocacy is part of a credit union board’s strategic responsibility. Unfortunately, too many credit unions aren’t involved in local, state, or national policy-making—and don’t even know where to begin. In fact, many board members don’t understand the importance of effective advocacy.

CUES Director member Carroll Beach, immediate past chairman of $1.4 billion, 110,000-member Elevations Credit Union, Boulder, Colo., can attest to advocacy’s effectiveness. In his 42-year career as a CEO/chief operating officer, president of the Colorado Credit Union League, and board chair for Elevations CU, he’s made political advocacy a top priority.

This focus has given him several career successes. For instance, when local banks introduced a bill to prevent government-associated individuals from serving on credit union boards, Colorado credit unions defeated the measure.

“The way we did that,” he says, “was to have a lot of individuals who were on boards of directors and volunteers and members converge on the legislature and make sure that they knew that the people of Colorado were interested in preserving the rights of credit union members.”

Beach places special emphasis on the importance of volunteers, including board chairs, in advocacy. “From day one,” he says, “I think advocacy on the part of volunteers has been the cornerstone of the successes of getting legislation passed.”

Helping directors be effective advocates means following some or all of the following steps.

1. Know the issues.

Effective advocacy starts with knowing what credit unions and their members need from lawmakers and policy makers. Beach puts the responsibility for this education on management’s shoulders.

“It’s very difficult for a volunteer to know all the different regulations out there,” he says. So management should stay on top of the nitty-gritty details, informing board members of the most pressing issues in legislation and regulation.

Once informed of the most pressing issues, the chair leads the way, according to Beach.

2. Focus on relationships.

At its heart, political advocacy is about building relationships. “You don’t wait until you need [a politician’s ear] to turn on the switch,” says Les Wallace, Ph.D., president of Signature Resources, Aurora, Colo. “Start the relationship before you need it.”

In this light, advocacy is as simple as small talk. When board members see an elected representative or staffer around town, they can shake hands, introduce themselves and their credit union, and strike up a conversation. The goal here isn’t to give a full-blown advocacy presentation. The goal is simply to “[remind] the elected official that credit unions exist, we’re in your backyard, and we showed up,” says Wallace.

It’s this kind of neighborliness that builds a foundational relationship for advocacy with individual representatives. This kind of visibility, even with small-town local officials, can pay off big in the long run. “All the national leaders . . .” says Beach, “generally come from the state level, and the state level generally comes from the local level. So it’s important for [credit unions] to be involved at the local level and make relationships that last 20 or 30 years.”

More intentional relationship-building is also essential. CUES Director member Ron Seaman has prioritized relationships with local politicians during his 27-year tenure as a board member for $2.1 billion SAFE Credit Union, North Highlands, Calif. For decades, he has attended political fundraisers for everyone from sheriff’s candidates on up the political ladder, cultivating relationships that have lasted many years. SAFE CU also hosts community events, which draw in local and state politicians, further deepening these connections.

Beach agrees that participating in fundraising and campaigning is essential. When a local politician shows support for credit unions, credit unions should support that politician. Boards can give financially, if possible, or simply devote manpower to the politician’s campaign. “[Politicians] do want those relationships. And there aren’t that many people that get involved in campaigns, so when you do, they notice that,” says Beach.

Establishing relationships with politicians’ staffers is also essential. “The staff are really very key people in terms of how the Congressman’s going to vote,” says Beach, “They provide all of the narratives and provide the information to the congressman or state legislator so they know which way they should vote.”

Credit unions should also seek to build relationships with regulators, which will give a voice on compliance. The strategies here are similar, but Wallace recommends an additional strategy state-chartered CUs can use with local regulators: inviting the head state regulator to present to your board once a year, perhaps at your annual strategic planning retreat. This gives regulators “a forum so that you get to know them, they get to know you, they feel respected,” he says, thus making them more open to hearing concerns about potentially harmful regulations in the future.

The key to successful relationship-building with local, state, and even national politicians is to remember that it’s a long game. The point of connection-building isn’t to get all elected officials on the side of credit unions. With many politicians supported by big banks, and banks and CUs in opposition on many issues, this is simply not a reachable goal.

Instead, boards should remember they’re building a foundation so that when a legislative or regulatory issue comes up, their credit union will have a voice. “You get to know these folks,” says Seaman, “and... you can communicate easier with them. They trust you, and they know where you’re coming from. Sometimes, maybe, they don’t agree with your position on a credit union thing, but they listen to you.”

3. Know your message.

Local advocacy thrives on handshakes and friendly conversations, but this is just the beginning. To effectively advocate for a credit union’s position, boards need to understand their message and how to deliver it.

To start, the entire board should have an “elevator speech” ready to go. That’s a 30-second run-down of what credit unions are and why they’re an essential part of the community. When credit union CEOs and board members encounter politicians, Lynette Smith notes, “[politicians] want to hear what’s going on . . . We have a good opportunity to explain to them how credit unions operate, why we exist, and how we should never, ever go away because we’re helping people.” A CUES member, Smith is president/CEO of Washington Gas Light Federal Credit Union in Springfield, Va.

Beach agrees. “[At Elevations], we feel that every board member here is an ambassador of the credit union. So wherever you are, you should be able to promote [your credit union], but you should also be able to promote the credit union idea.”

Presentations and formal conversations about particular issues, however, take more than an elevator speech. Smith, who worked with the National Association of Federal Credit Unions to present congressional testimonies in 2011, 2012, and 2013, says that when it comes to particular issues, elected officials really want to hear how the legislation is impacting your credit union and your community.

“You bring to light the hindrance some of the policies are,” she says. “You can never go wrong in any advocacy presentation telling them your story.”

Just because board members can present from experience, though, doesn’t mean there’s no homework involved. One of the most important pieces of crafting an advocacy message, Wallace says, is understanding the audience.

“So whoever you’re going to try to influence,” Wallace says, “know where they stand on the issue and who supports them in that. You’ve got to align the message to what’s in it for the politician . . . Be able to answer the question, ‘Why is it valuable for you, Madam or Sir, to support this, and why will it play well back home?”

Because official presentations require this kind of “spin,” Wallace suggests that a credit union’s CEO and board chair carefully choose their credit union’s official political advocates.

“Not all board members are capable or willing to be good advocates,” he says, “It does take a little discipline and sophistication. When it’s crunch time for a message, you want your most articulate voices to be part of that message.”

4. Leverage available resources.

There are, however, a few simple actions that all board members should take, whether or not they’re interested in Hike the Hill, political fundraising, or Congressional panel presentations. NAFCU, the Credit Union National Association, and state credit union leagues offer resources to help board members painlessly participate in the advocacy process.

For instance, the California Credit Union League offers its Connect for the Cause website. The site briefs board members on the issues at hand, and it offers form letters members can send to their local representatives to get their voices heard. “You can select who you want to send [the letter] to,” says Seaman, whose board members are all connected to this site. “You can use what the league has put together, or you can write your own letter.” Resources like these make advocacy easy, even for less politically minded board members.

Smith has recently seen advocacy success on national issues because of NAFCU’s regulatory comment letters. A third of the 6,000-plus credit unions in the United States responded to NAFCU’s May 2014 comment letter about the agency’s first risk-based capital proposed rule.

“The regulators heard us,” Smith says. “To me, that was one of the major accomplishments [of 2014] in the industry, that NCUA did respond.”

Of course, there are always local, state, and national events that allow board members to involve themselves in advocacy. CUNA’s Governmental Affairs Conference and NAFCU’s Congressional Caucus present opportunities to learn more about advocacy and current issues, while talking directly to members of Congress and their staffers. State leagues often host similar events for reaching out to state and local representatives.

Even with these straight-from-the-box resources, political advocacy may seem overwhelming to a credit union’s board, particularly in a smaller organization. Boards can start small, using form letters and building connections with local representatives who are their friends, neighbors and Rotary Club co-members. However, directors simply cannot afford to outright ignore advocacy issues, especially in today’s questionable climate.

“The next few years,” says Beach, “are going to be really challenging for credit unions in terms of preserving the tax-exempt status... so it’s more important now than ever for us to advocate in a very positive and forceful manner to the Congress.” With simple steps like these, any board or chairperson can get started with political advocacy.

Abby Hayes is a freelance writer based in Indianapolis.