Brandee McHale: Changing Hearts and Minds

Jennifer Tescher:
Welcome to EMERGE Everywhere, I’m Jennifer Tescher, journalist turned financial health champion. As founder and CEO of the Financial Health Network, I’ve spent my career connecting forward thinking leaders to the growing fin health movement. Now, I’m sharing these conversations with you. Discover how these visionaries are challenging the status quo and improving financial health for their customers, employees, and communities.

There are few people that understand the vision behind financial health more than my guests today, Brandee McHale. Brandee and I have known each other for over two decades and we’ve conspired on numerous efforts to change hearts and minds by sharing the data and stories behind the financial lives of the financially challenged and excluded. Now, as the Head of Citi Community Investing and Development, and the President of the Citi Foundation, Brandee channels her knack for seeing trends and forming trusted partnerships into positive, measurable change. Brandee, welcome to EMERGE Everywhere.

Brandee McHale:
Thank you. Thank you for having me here today.

Jennifer Tescher:
I want to dive right in. We could talk for hours. We’ve known each other now for, gosh, over 20 years. We’ve collaborated together on a number of projects. You’ve been at Citi in different roles for most of that time, mostly focused on community investment, community engagement. You were at the Ford Foundation for a time where we worked together. Gosh, your commitment to all of the ways that we need to be improving the lives of the underserved, is just sort of woven into who you are. I’ve never known you doing anything but this work. I wonder if you’d be able to talk a little bit about where this passion comes from. Is this a calling you always knew you had?

Brandee McHale:
Thank you so much for the question. I love the opportunity to be able to just talk a little bit, from a personal level, about why this work matters so much. We’ve been friends for a long time. Something that you may not know about me, which is that I left high school. I have a high school equivalency. I went back to school, started taking classes at a local community college, went on to a local university, and through a series of events and connections, I was able to get my life back on track. That incident did not derail me.

What always stuck with me was, what was it about my life that allowed me to not derail and that there were more on ramps back on the path to opportunity than there were off ramps. There are a lot of probable reasons why. I now understand that I had access to social capital, that I didn’t really understand the power of that. I think that there are racial factors that matter. Different influencers, but it’s always driven me. The idea we hear often, everybody is born with potential but not opportunity. I’ve always been committed to seeing how do we level the playing field for everyone.

Jennifer Tescher:
Thank you for sharing that Brandee. The fact that you could recognize, that despite the challenges you might have had, that you still were lucky is, I think, really something, something that I wish more people sort of had that kind of empathy and insight around. Now you and the Citi Foundation have been long advocates of using data to understand the real financial lives of everyday Americans. First, with cosponsoring the Financial Diaries work that we did together, where we followed 200 plus families over the course of a year to understand the decisions and choices they made about the money that flowed in and out of their households, really groundbreaking research. Now as sponsors of the Financial Health Pulse, alongside Principal Financial, we just released the 2021 Financial Health Pulse. Showed that just over a third of Americans are financially healthy. It’s a slight increase on the highest level since we’ve been measuring, which is a little bit counterintuitive given that we’re in a pandemic, but two thirds of Americans still remain financially unhealthy. I wanted you to talk a little bit about why you think this kind of data and insights is so important.

Brandee McHale:
Well, I think that you said something just now that is so important, it’s data and insights. Without the analysis and the work that organizations like the Financial Health Network do to help make sense of all of this information and cut through in a very noisy world, the data is just another set of numbers and information. I also think because we’re living in a time with many competing interests, there is so much discord, such a lack of agreement on things, that we do need the data to bolster our points and to bolster our evidence. Resources are continued to be scarce, but consensus continues to be scarcer.

I think that the data helps to create a ground where people can come together, almost depoliticize the information, and say what actually are the facts. We also know facts alone don’t necessarily drive the outcomes and the behaviors and the choices that we’re looking for. Again, I’m a big believer in both data, and then putting that data in the hands of change agents who can use that information effectively.

Jennifer Tescher:
Right. A little bit hearts and minds, we need the data and we need the stories. Then we need to not just have it sit there, but we’ve got to make sure we’re leveraging it.

Brandee McHale:
Yeah.

Jennifer Tescher:
The Pulse data that we just published, also found that, thanks in large part to government aid and all of the stimulus during the pandemic, black and Latinx individuals saw meaningful improvement in their financial health between 2020 and 2021, but still there are enormous gaps in financial health. While 39% of white individuals are financially healthy, only 21% of black individuals and 24% of Latinx individuals are. Like a lot of other large banks, Citi has made significant commitments in the last year or two towards bridging the racial wealth gap. I know it’s a very big focus of yours in your role today. How do we continue to build on the momentum, which some fears frankly, already waning? The government can just literally print more money and send it to financially strapped Americans. That’s what they did during the pandemic, to good effect. What can Citi and other companies do, to drive real change as it relates to the racial wealth gap?

Brandee McHale:
Well, I think first and foremost, it’s not just about what additional things we can do, but let’s step back and look at what we do day in and day out, and how do we do those things differently? So we’re being very intentional. Maybe this is why I’m not actually in the product development side of the bank, but I sort of come to work every day and think, “We actually probably have every single product out there that anybody could need, but how do we actually change how we distribute products? How do we change how we bridge the trust gap that still exists? How do we take ownership of the fact that there is that trust gap? How do we employ people who can both be representatives for our financial institution, but also build that trust, and again, approach it in a very different way?”

I think we need to start by being intentional and not being afraid to call this out. I think that there is still… At Citi, it’s a topic where we’re learning to be comfortable being uncomfortable. What I’m hoping though, is that that’s not where we get stuck, that we’re actually going to get to a place where we are comfortable calling out these disparities and looking behind to say, “What is our role as an institution, as an industry and what can we do differently?” I do think that, and I’m optimistic, that we’re actually beginning to see some positive outcomes from this increased awareness and intentionality.

I’m hoping that the perception and the sense of more financial health and financial security, is actually related to the fact that we are changing the trajectory in terms of diversity and hiring, that we are looking at closing pay gaps, that we are looking at closing the opportunity gap. I think we’re onto the start of something very big, but we should still recognize it’s a long journey. It will not be a one and done. We need to look at this, again, at our own choices on a long term basis.

Jennifer Tescher:
I appreciate you talking about the process, that in some ways the process here may be even more important than the product, if you will. I wonder if you can talk a little bit about what it’s been like internally, to have those hard conversations and to start to change that culture. Citi isn’t unique in this regard, in terms of being comfortable being uncomfortable. I wonder if you can give a little bit of an inside view of what that looks like, how an enormous firm like yours, a global firm, sort of goes about that.

Brandee McHale:
Yeah. Our CEO, Jane Fraser, right before she became CEO, when we were thinking about how is it that we respond to the events of May 2020 and the murder of George Floyd, we knew instinctively that philanthropy was important, but totally insufficient to respond to the systemic challenges of racial injustice and inequity. Jane said something in a meeting when we were, again, coming up with ideas and trying to figure out what to do. She said, “Brandee, let’s not forget that this is not just a challenge that we need to solve, but an opportunity to be seized.”

If we only take a problem solving mindset to all of this, I believe we’re going to only get so far. Demographics in this country are changing. Consumer preferences continue to change. That’s one of the things that we’ve done, is to say, “This isn’t just being responsive to a crisis or adapting to a regulatory change or a requirement, but really choosing to say, how do we put racially diverse consumers and institutions at the center of our business approach?” That’s been the challenge to also recognize that the same way we’ve done it in the past, is only going to get us the same outcomes.

Jennifer Tescher:
We’ve been talking largely about racial inequities, but as you know, there are inequities around all different forms of our identities. The Pulse data really gets into that, whether that’s around gender, sexual identity, ability, race, ethnicity. I want to talk for a minute about gender because there is a widening gap there. The data shows that only 26% of women are financially healthy, compared to 43% of men. The gap really widened in 2021 because of employment disruptions and childcare responsibilities brought on by the pandemic. Now, Citi has been a leader in disclosing the results of its annual pay gap analysis. I think that’s been happening now for several years, and doing the work then to close that gap for women.

Just the other day, the company announced that it would be the first large bank to undertake a racial equity audit. I wanted to pick up on the comments you were just making a moment ago about Jane and the role of the CEO. From the outside, I think a lot of us wonder, how do actions like these ultimately come about, right? How much of this is about the personality or the passion of the CEO? Is it the board? What will it take to see more companies step up in the way that Citi has in this regard?

Brandee McHale:
Well, this is something I often think about myself at 3:00 AM, how to be an internal change agent, how does this happen, and what are the levers of success. What I will say is that actually, I’ve never really seen it happen overnight. In the work that we’ve done on closing the racial wealth gap, didn’t actually start in May 2020. It started many years before through partnerships in the community, sponsoring research, by really building our own expertise, so that when there was that moment, we had ideas where we could act. We weren’t paralyzed by a crisis. We actually said, “Let’s use this crisis moment, and when we have everyone’s attention, to actually put forward something bold.” It also really helps when you have leadership that is pushing you to be bold.

We are going through an incredible transformation in our company, where questioning the status quo is expected of every leader. I think that’s the transformation we’re going through in our country. That’s what we’re expecting from our elected officials. It’s what we’re expecting from our community leaders. That’s a very interesting trend that I, as a leader in this very large company, I actually feel empowered to be questioning the status quo, to be coming up with bold ideas. That bigger culture shift starts from the top, but it has to permeate throughout the company. I have an externally focused job title, but a hundred percent, I see myself getting up every day and I am here to be an internal change agent. When you have somebody at the top who is empowering you to be bold, even if the answer is, “No we’re not going to do this,” that’s, I think, a really winning combination for success.

Jennifer Tescher:
As a female leader in what has historically been more of a man’s world, let’s just be honest about that, banking and finance, how does it feel now to have a woman at the top? Really the first, very large bank to be led by a woman. Is there something palpable that you can feel, just by having a woman at the helm for the first time?

Brandee McHale:
It’s interesting. It’s such an incredible source of pride for us. I’m so happy to be part of the institution during this moment, but I will just say that there have been so many women who have broken ground in our company over the years, that this feels like another milestone, as opposed to the moment or the milestone. Yeah, I mean it’s funny… I guess it was possible because it never really felt like it was going to be impossible in our company, because as a woman, I really, especially in the past 5, 6, 7, 8, 10 years, have really felt, not only do I have a seat at the table, but the diversity of thought and voice and opinion was really encouraged.

While we are so proud and we see the recognition externally, this type of thing doesn’t necessarily happen overnight. Frankly, I kind of grew up in this company. It never occurred to me that there was nothing I wouldn’t really ever be able to do. Does that mean there were moments where I didn’t feel intimidated or didn’t feel comfortable with my voice and had to find my voice? Absolutely. Is it easier today? Absolutely. Is it less challenging? No.

Jennifer Tescher:
Yeah. Well, I think back to one of your earliest mentors at Citi, the great Janet Thompson, and you’ve really had the privilege of being surrounded by incredibly strong women leaders for much of your career.

Brandee McHale:
Yeah. Yeah. Well following Janet, was Pam Flaherty.

Jennifer Tescher:
Of course.

Brandee McHale:
The thing I would say to people about Pam, is that Pam, well she may not have been the CEO of Citi, she ran the Consumer Bank, for what was then Citicorp. I will never forget, at a time where women didn’t wear pants, literally did not wear pants to work, we wore skirts, we wore dresses. Yeah, a lot of trailblazers over the years.

Jennifer Tescher:
Yeah. In fact, it’s funny now that you say it, when I think about Pam, I think of her headshot with that black turtleneck.

Brandee McHale:
Yes.

Jennifer Tescher:
She was like the Steve Jobs of her time in a way.

Brandee McHale:
Yes, very iconic.

Jennifer Tescher:
Beyond your internal role at Citi, you are regularly engaged with other leaders in both business and philanthropy, broadly speaking, on all of these issues. My gosh, we haven’t even talked about climate change, which I know is also a very big focus for you. There have been lots of commitments made, lots of conversations, and we’ve seen a few early leaders embrace stakeholder capitalism more broadly. I wonder if you could talk for a minute about the connection between business and philanthropy, in solving these challenges that we’ve been talking about. Is philanthropy really still the ones doing the heavy lifting here? Is business doing enough? How do you think about the inner connection, the intersection, between those two things?

Brandee McHale:
I think that philanthropy continues to be the place where you have this space to think, to challenge ideas, to learn, and to really test out, in a safe way, ideas that should be scaled through the private sector. We’re a big believer that our role in driving positive societal impact, we have to lead with our core business capabilities. That is the only way that we will find sustainable scalable efforts. Frankly, that’s really where we can add the most. That’s where we have the capital and the expertise to really make a meaningful difference. Philanthropy is incredibly important because it’s not really the venture capital, it’s the place for venture ideas. We think of it as along a spectrum. I think that we’re meeting more in the middle. Philanthropy’s looking a little bit more like business, which is okay, but I think what’s even better is that business is looking a little bit more like philanthropy.

Jennifer Tescher:
Hmm. That’s interesting. One of your superpowers, Brandee, is your ability to really zoom out and see the big picture. As you declared yourself earlier in our conversation, you’re really an optimist. As we close, I’d really love to get you to reflect on the future. This is a hard time to be a leader, or a citizen for that matter. Even if we’re able to push back successfully against the pandemic, we’re in an era of great challenge on just so many fronts. I’d love to hear more about what you think is the north star as we work to make a difference in the world. What are we aiming for? How do we stay resilient or optimistic on our quest to get there?

Brandee McHale:
Yeah, it’s a great question. A few years ago, we participated in a project together with the Federal Reserve Bank, on a book around financial health, financial inclusion.

Jennifer Tescher:
Right.

Brandee McHale:
I wrote a chapter that, I hope will be my signature tagline, and the chapter was entitled, SO WHAT? The chapter went on to talk about how we’ve been so overly focused on, what is the evidence that shows it’s working? What is the evidence that shows that we actually have ideas that can go to scale? While I believe that that is really important, and more than ever, we’ll go back to where we started a few moments ago, where we said, thinking about winning hearts and minds. I think that continuing to put forward a vision where people believe in the possibility that the things they want to see happen, that they have the ability to make that happen. I don’t want to discount that. I spent many years in this work thinking about very broad systemic change. I’ve now come back a little to personal hope, optimism, self-efficacy, empowerment, actually is just as important.

When we lose hope, we see what happens. We’ve lost hope and faith in our public systems and our political systems and look where we are. I’m a big believer that actually small success stories can have a powerful outcome. I do think that as we move forward, we need to keep raising up stories that show that the impossible is possible. I think we need to also raise up stories that show how when we work collectively, that we actually can accomplish more faster. I don’t know that we’ll ever reach our end goal, but perhaps that’s the point, is to actually keep refueling ourselves so we can keep on this journey because it’s going to always evolve. There is no endpoint. The endpoint is continuous improvement and advancement and mobility. We just need to keep fortifying ourselves with these small wins along the way and continue forward.

Jennifer Tescher:
Brandee, you inspire me every time we talk and we’ve known each other a long time. Thank you. That’s a perfect way to end our conversation and I appreciate you joining me on EMERGE Everywhere.

Brandee McHale:
Thank you.

Jennifer Tescher:
This has been EMERGE Everywhere, a Financial Health Network production. If you like the show, please help spread the financial health message by leaving a review. If you have ideas for future guests or thoughts on the show, please click on the link in the show notes to connect with us. See you next time.