Our view: Union Bank puts money into social equity effort
There is no doubt that the killing of George Floyd and subsequent events have prompted the biggest discussion in decades about social equity and justice in America.
One of the biggest debates in Corporate America today is how far the current discussion will lead. And one of the biggest problems in getting some perspective on that debate is the fact that there are relatively few black corporate leaders in California and on the Central Coast.
One of the most influential of them is Julius Robinson, head of corporate social responsibility for the Americas at MUFG Union Bank. After initially announcing a $3 million initiative to help with COVID-19, Union Bank rethought its plans in the wake of the George Floyd protests.
On June 18, CEO Steve Cummings announced an expanded $10 million effort, with $5 million devoted to fostering innovation and entrepreneurship, $3 million for workforce training and an additional $2 million for safety net programs and financial education. The expanded program acknowledges that “racial injustice and economic exclusion are deeply intertwined,” Cummings said in a statement.
In a phone conversation, Robinson said that Union Bank learned a lot about helping communities in distress when the Fresno area was hard hit after the 2008 financial crisis. He said those lessons, involving chambers of commerce, nonprofits and programs like SCORE, will be put to use in the new effort.
But he said the current social debate is like nothing he’s seen for decades in the United States and it could have a long-term impact. “This is a systemic change,” he said, comparing it to the way that Nelson Mandela’s work transformed South Africa in the 1990s.
But economically, he said, times are going to be tough for small businesses. In some minority communities, he added, some 40 percent of companies “are not coming back.”
For Union Bank, part of the expansion from $3 million to $10 million will be funded by repurposing fees the bank will earn for administering the PPP lending program set up under the CARES Act.
In Fresno, Union Bank found that as it got its efforts rolling, other banks and community institutions joined in a bigger economic development effort. We suspect that Union Bank will find plenty of partners as it works to strengthen minority entrepreneurship and rebuild our communities.
GOOD FOR BUSINESSES
Ventura County has found a way to provide a small amount of emergency funding to smaller companies and nonprofits.
Coming on top of PPP funding and emergency SBA loans, the $5,000 grants can be the difference between scraping through and folding for a number of firms. This is an innovative effort and Santa Barbara County should take note.
Speaking of innovation, the city of Santa Barbara’s move to close a portion of State Street is working and garnering lots of attention in the media. The city is proposing a modest expansion and some new rules to allow for more density.
These are positive and pro-business developments.