Energybank
The flow of money can fuel the energy revolution. However, not all banks are capable of turning it on. Energybank partners with hyper local communities and renewable energy companies to make it happen.
The flow of money can fuel the energy revolution. However, not all banks are capable of turning it on. Energybank partners with hyper local communities and renewable energy companies to make it happen.
In the years after the Royal Commission into banking, trust in Australian banks has remained low, particularly in rural areas. In an attempt to rebuild trust, Melbourne-based bank EZN decides to divert their in-house innovation unit and refashion it into an independent bank with a mandate to micro-finance innovative, energy-positive community loans in rural communities.
You work in the now-defunct innovation unit within EZN bank. You are charged with leading the transformative project through a prototype to test whether the concept is viable. You and your team will need to relocate to rural Victoria and launch the first bank office in a remote town. You’re tasked with integrating the business into the community and assessing whether the process can be replicated and at what scale. At the same time, the media are circling and rumours are already flying about big banks once again targeting rural communities.
You’ll need to steer your team through a major career transition, uprooting and moving to the country, working within a hostile town, and managing a delicate media situation while balancing the interests of the bank, the innovation branch, and the community.
Trust in the major Australian banks is at a low. After a series of scandals in 2017, the Turnbull government was forced by an alliance across Labor, LNP, Greens, and Nationals to announce the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry. The Royal Commission was established on 14 December 2017, headed by Kenneth Hayne, and intended to look into what Commonwealth Bank Australia whistleblower Jeff Morris called “systemic bad behaviour” within the Australian banking industry.
The final report covered 496 pages, seven themes, and 76 recommend-ations. Some recommendations that have been implemented in the intervening years include:
Some recommendations that are still to be implemented include:
Some recommendations that have been abandoned:
In 2018, during the Royal Commission, a Deloitte survey found only 21% of Australians believed banks had their best interests at heart and only 26% believed that banks will keep their promises. A 2019 study by the University of Melbourne asked “Which of the following do you feel is stopping you from improving your household/your financial situation?” to which the most common answer (27.7% of respondents) was “I do not trust financial institutions or advisors”.
Today, the situation is not much better. Although the government has legislated some of the recommendations made during the Royal Commission, there has been a drift back to previous practices.
The Royal Commission also highlighted the disconnect between agricultural interests and financial products. Some injustices uncovered by the Royal Commission include unqualified valuations of farms, such as a case wherein a farm was valued at AUD1.2 million based on an estimated size of 896 hectares when it was only 72 hectares. A Bankwest rural bank manager, who later resigned, earned a bonus of AUD35,000 in 2011 for selling a loan based on that inaccurate assessment.
As noted in this article in The Conversation: “Higher values enable farmers to borrow more money for farm improvements, and the local lending branch manager to earn higher commissions”.
In more recent years, Australian farmers have been made extremely vulnerable as COVID-19 disrupts both international supply chains and the obligated seasonal workforce (visa subclass 417).
At the same time, other forces begin to converge and implicate banks. Among other causes, the US election and COVID-19 led to a disappointing outcome at the 2021 COP26 conference on climate change, especially in terms of driving new environmentally-geared financial initiatives.
In the weeks after COP26, the Morrison government overrode several states’ participation in a greenhouse emission reduction scheme, global Under 2. This move felt at odds with the direction the Australian public is leaning. According to a 2021 Lowy Institute poll:
In September of 2021, Murdoch-owned News Corp pledged it would end its long-standing editorial hostility towards carbon reduction policies.
Running in parallel to the decline of trust in big Aussie banks and the rise of climate concerns, disruptive new blockchain technology is broadening the mainstream definition of economics to force a more global perspective. Many countries have been slow to legislate protections or formalise opportunities around cryptocurrency, NFTs, and borderless financial instruments.
Low trust in banks. An emerging landscape for financial innovation. Consumer desire for climate-friendly tech. The mood is right for a change within traditional banking and financial initiatives.
EnergyBank was born from EZN’s internal design and innovation unit, set up in 2018. In the intervening years, the unit worked on an internal client-based model, responding to initiatives in specialist units. But now the design unit is being pulled out as an independent entity to construct EnergyBank, and heralds a reshuffle in the EZN organisational structure.
EnergyBank is tasked with building a small-scale, energy-focused bank based on blockchain with a bias towards lending at low cost for home-based sustainable energy as well as major tech investment in renewables. That said, EnergyBank is still a subsidiary of EZN bank.
McKensie wants EnergyBank to tap into micro-finance, crypto, and blockchain with a social and climate-focused conscience. Several major banks have begun to introduce similar functions to appeal to a younger audience and keep up.
The design research and development proposal for EnergyBank was prepared by an EZN Executive with input from the Bank’s design and innovation unit (this is where you come in - more in on that in a moment).
The proposal outlines the following as key pillars of EnergyBank:EZN Bank, established in the 1960s, has traditionally been a rural bank and was implicated in the Royal Commission. EZN bank employs 5,600 employees across 280 branches. EnergyBank is a new unit authorised by EZN CEO Jackie McKensie, designed to counter criticism from the Royal Commission findings. Jackie wanted to introduce ethical banking initiatives across the entirety of EZN bank but realised this was too ambitious in the first instance. EnergyBank will be the first in several initiatives aimed at improving trust in EZN. McKenzie has assigned Victoria Hussey, the former founder and CEO of solar startup Brighte, as CEO of EnergyBank. Victoria has been tasked with developing ethical banking at the core of this EnergyBank. The EZN board will monitor this as it rolls out.
You are a human-centred designer and you work in the EZN design and innovation unit. You are asked to lead the implementation of a contained proof of concept. McKensie and Hussey decide the proof of concept should involve your team embedding within a rural community, building back trust, and micro-financing socially-conscious energy-focused initiatives.
You were involved in the design of the plan but you never expected to be chosen to implement it. You’re a little out of your depth.
You are a 38-year-old human-centred designer. You live with your partner and two young kids (ages 5 and 8) in Hawthorn.
You graduated university with an accounting degree before deciding (after an agonising year in the most boring job imaginable), that it wasn’t for you. You then made the hard choice to pivot to innovation and design, completing a masters at RMIT. You decided to make use of your bachelor degree and work as a HCD in the finance space.
You spent two years with a start-up as a generalist experience designer developing an app that uses the blockchain to create secure transactional contracts between mistrustful parties. When this role became too small for you, you quit and spent four years as a user experience designer at ANZ.
You got the job at EnergyBank two years ago, after an intense series of interviews and tests. Ultimately, you won the position because of your background in fintech and conventional banking. After a year, you were promoted to head of your team.
You’ve also done consulting work for apps and finance instruments, including Afterpay and Nimble.
The first task you’re given is to set up a board of advisors for yourself. Both McKensie and Hussey agree this is a huge undertaking and you’ll need a support group around to advise you. You will choose four advisors from a set of existing personal and professional connections to guide you in this project and in your career.
“You are responsible for creating your own job title and carving out a successful career. You are also the primary decision maker in your professional life. This is why it is helpful to think of yourself as your own business with you at the helm as CEO,” said Arpad Szakal, an executive recruiter in a LinkedIn article.
A personal board of advisors is a modern concept. The current and incoming generation of workers change careers and jobs more often than previous generations. A 2016 Gallup report found millennials (people born between 1980 and 1996) are increasingly seeking purposeful work over job satisfaction and found they “move freely from company to company, more so than any other generation”. 21% of millennials have changed jobs within the last year, three times more than non-millennials. A personal board will help to guide you in your new role and provide resources and experience you can lean on.
“Your PBOD exists to act as a sounding board, to advise you and to provide you with feedback on your life decisions, opportunities and challenges. They provide you with unfiltered feedback that you can’t necessarily get from colleagues or friends. A personal board of directors doesn’t necessarily meet as a whole, and it’s your choice as to whether you formally identify individuals as a member of your PBOD,” said Lisa Barrington, in a Forbes article.
As the leader of the team, you’ll also need to discover new ways of working that align with the EnergyBank agenda.
Choose three people to join your board from the following:
You can use the advisory group to find new ways of working and designing. New ways of working could include convening a series of expertise seminars or workshops around the knowledge that you know will help including systems-led design, co-design in finance, high-performance teams. etc. The design team is self-managed and will establish its charter of accountability and continual improvement.
EZN bank was implicated by the Royal Commission for overvaluing land and overextending loans for farmers. While bigger banks bore the brunt of the media, EZN doesn’t want to invite comparison or rehash the accusations.
Even though EZN bank is a small bank, one of the most compelling RC cases uncovered by journalists was linked to EZN and spent a long time ricochetting around the news cycle.
A young farmer and his family lost their organic dairy farm due to an unscrupulous EZN loan manager who egregiously overvalued their land. The farmer’s land, on the outskirts of Byron, was a community hub and supported a shop for local produce, a popular cafe, and a Men’s Shed.
The farmer himself is well-spoken and environmentally minded, his partner has a law degree, and they did the rounds of morning TV and radio shows. They are still advocating for their case and others through Facebook groups, podcasts, and local events. The tight-knit local community also rallied around the family and was vocal in admonishing EZN during the Royal Commission through whatever channels were available to them. Trust levels for banks in their community is zero.
After weeks of research, Hussey and McKensie select the town of Mirboo North in Gippsland to establish EnergyBank prototype branch. Mirboo North is a small farming town a two to three-hour drive from Melbourne, with a population of around 1600. The farms in the region grow 80% of Victorias brushed potatoes for six months of the year.
As ethical banking is at the centre of the EnergyBank modus operandi, it feels appropriate to test with a rural audience who have previously had bank experiences with big banks.
Before the EnergyBank reveal and launch, the EZN innovation unit consisted of 32 people - a mix of HCD, graphic designers, creatives, developers, and managers. After the schism, only 8 will be left in the EZN bank innovation unit and the rest moved over to EnergyBank. EnergyBank has a different set of conditions, expectations, and roles than EZN. To achieve the aims, the work culture will also need to change - this isn’t a corporate banking setup anymore.
Of the 24 people who are flagged to move over to EnergyBank, four choose to leave. You, and the managers, believe you’re over the worst of the churn. However, once it’s announced that the prototype will roll out in rural Victoria and future EnergyBank endeavours will focus on regional clients, many more of your colleagues grow concerned.
Your inboxes are filled with worried messages from people who now feel insecure in their jobs. The reality is their day-to-day work will be focused on rural communities and some of the team will need to relocate. Working in a rural-focussed startup is a far cry from the finance job many of your team originally accepted. You will need to consider how to manage this transition, negotiate new working and salary conditions, decide who in your team will need to relocate and, if so, how to incentivise relocation, all the while remembering EnergyBank’s ethical banking ethos.
Is there such a thing as an ethical micro-loan? You’re about to find out. Hussey and McKenzie have a conversation with you, informing you of the grand plan to use Mirboo North as the testing grounds for EnergyBank’s new offering - environmentally-friendly, community-focused micro-loans.
Mirboo North was chosen because of its tourist appeal. Micro-financing in Mirboo aims to capitalise on unique features of the town and build its fiscal profile while also addressing social problems. A 2016 survey of Gippsland residents by the Gippslandia publication painted the following picture:
“After a bit of digging, we uncovered some validating and somewhat troubling statistics. In Gippsland, 75% of adults are overweight or obese (1). In the Latrobe Valley 8.4% of our residents are unemployed (2), and 25.5% of our youth are disengaged from study, training or employment (3). The Latrobe Valley is home to a number of ‘food deserts’, which means that fresh and healthy food is not accessible to many members of the community. For every 1 fresh food outlet, there is an average of 3.7 takeaway food outlets (4).”
Examples of ethical micro-financing in Mirboo North could include:
Journalist
(Imogen Baker)
Energybank Project Manager
(Matt Kurowski)
Find the Royal Commission documents here
“In my case, and in a lot of other cases in the community that I'm involved in, they're actually behaving worse because they haven't been scrutinised by the commission," said Lena Anderson, a consumer advocate, in a recent ABC article.
For example, the Hepburn Wind Community Solar Farm, run by Hepburn Community Wind Park Co-operative, is the first Victorian hybrid wind and solar park. It aims to greatly contribute to the shire's zero-net energy target by 2025 and zero-net emissions by 2030 and share the benefits of the park back to the community. More examples of Victorian energy intiatiaves can be found here.
Guiding principles
After you’ve formed your team, one of the first tasks you must complete is to co-design a set of guiding principles for the team to refer to throughout this long-term engagement. Guiding principles are a way to call out inconsistencies between an organisations stated aims and what it does. The act of developing principles either for the top-level or the instance is a valuable exercise for the team.
Guiding principles work at two levels. The first is as a framework for a values-based culture to develop across the organisation. The second is in specific design situations, such as designing a service or product.
At the top-level the principles are set so that any action within the organisation (such as writing a policy or recruiting a new staff member) references the principles. For example, when a policy is developed around environmental sustainability, it should also reference the accessibility issues as outlined in the principles.
With a product or service, principles become more focussed on the service or product itself. They will reference the top-level principles as well as what guides the specific design. For example: a design principle might be to rely on input from someone with lived experience. The principle would be to respectfully engage with a person with lived experience, with attention to the power relations and ethics in the situation.
Some examples of guiding principles include: Speak out loudListen intentionallyWork out loud, Be transparent at all timesLean-in to ethical practices, call-out ‘ethical-fading’ internally and externallyA bias towards care: self, team, project, partnersLearning in constant reflection and through documentation Seek to innovateWork smart
Questions to help you manage your teamWhat are the resources that the team will use to organise itself? These could include studies, current practices, or your experiences.How will you optimise the talent in your team? You may choose to do an analysis or 360s. Or you may choose to let the talent and dynamic surface organically. It depends on who is in your team.Is there someone at work or on your board who could be valuable in helping you form the team or help the team form themselves? How would you involve them? For example, you could bring them in as a workshop facilitator.What are the responsibilities and accountabilities for each team member? Who is covering what tasks, outputs, deadlines, alerts, communications?Will your team change over time as the project moves through different stages? If so, how will this be managed? Who initiates the changes, what types of handovers will there be?
A conversation with Hussey and McKenzie
Victoria Hussey grabs you on your way to lunch and asks if you can jump onto a video call with Jackie McKenzie, the CEO of EZN. You’re not saying no to the CEO of EZN so your ham sandwich is forgotten.
During the call, the two of them are very aligned. It feels like they are collectively talking to you, managing you, so you have your back up a bit. Why do they feel you have to be managed? Have you done something wrong already?
They talk at length about the intent of the Mirboo project. They tell you it will run, as a pilot for a year, with a view to unlocking the blueprint to access other regions around Victoria and even NSW.
They talk a little bit about blockchain, incorporating blockchain into the processes. No one is more enthusiastic about new tech adoption than you but it does feel unnecessary. Like adding voice-activated security to a banana - why on earth would you?
Towards the end of the conversation, you ask about how they intend to manage the transition of the team to Mirboo North. Hussey has an answer for you - only half the team need to transfer regionally and they’ll be compensated fairly with relocation packages, comped accomodation and flexible work arrangements. You wonder if there might not be better ways to compensate your team.
Early days
The relocation doesn’t go as smoothly as you might have hoped. At least half your team still travel back to Melbourne on weekends as they struggled to relocate their families. One team member quits. You trial flexible work hours and working from home to accomodate the team’s needs and in the process, realise that the expensive office you’re renting isn’t getting much use.
You decide to find a new space to set up a coworking space for your team and the community at large. Unfortunately, coworking is bit of a new concept in Mirboo and you face some communication challenges when you explain it to locals.
The PR team at EZN bank love the co-working idea and arrange to send a journalist out to photograph the space and interview you about EnergyBank. The content is slated to appear in a national publication in a (paid) feature as well as the EZN newsletter and social media.
It doesn’t take long to find a nice property with frontage onto the main street of Mirboo. It’ll need a few renovations to convert it from what it was (a bookshop) to a slick open-plan office. The timing of the incoming journalist and the renovation is tight so for a week or so, all you can think about is logistics. You don’t notice the grumbling around town.
Not happy, Jan
One of your team grab you on the way into the (nearly finished) new office the week before the journalist is due to visit. They tell you someone in the community approached them the night before at the local pizza shop and had an angry conversation.
Team member: I hate to be the bearer of bad news, but it seems there’s of a problem with this office.
You: Oh, really? What’s the problem?
Team member: I was picking up dinner at Gino’s last night and ran into Katrina, you might remember we had a chat with her a few weeks ago at the coffee shop? Red jumper lady?
You: Vaguely…
Team member: Well, she works at the old folk’s home. And she told me that everyone is pissed off that we’ve chosen this office to lease--
You: Why? Wasn’t it available?!
Team member: No, no it technically was. It’s all above board legally. But apparently there’s an old couple, Brian and Lynn, who ran the bookshop that used to be here. They’ve run it since … I don’t know, decades. Anyway. During COVID, Lynn was diagnosed with breast cancer and is going through chemo. They decided to shut down the shop for obvious reasons, while she recovered. It was assumed that their building would be rented back to them when they were ready.
You: Is Lynn okay, do they want their premises back?
Team member: I think so, not that they want the building back, but Lynn is recovering well apparently. I have no idea if they want it back, they’re old enough to retire but…
You: Might be something they want to do for the love of it. Shit.
Team member: Yeah. I think the community was hopeful the bookshop would reopen.
You: Why did the real estate let us lease it?
Team member: I don’t know. Maybe they didn’t know, they’re not from around here.
You turn and look at the all-but-finished renovations and wonder what the heck you should do now.
