Traditional banking is changing, from one driven by risk and return, to one driven by risk, financial return and social impact. And leading the charge is Beneficial State Bank, based in Oakland, California.
Beneficial State Bank’s Model
The bank is as unique as the outlook of one its founders, Kat Taylor, who started the bank in 2007, right before the Great Recession. Unlike big banks, Beneficial State Bank is certified as a B-corp, an emerging industry measurement and certification for impacting for-profit enterprises. It is also structured as an economic enterprise whose rights are owned and held by Beneficial Foundation, a non-profit.
And 75% of its loan portfolio is aimed towards what its founder calls change-makers: entrepreneurs and enterprises who are servicing affordable housing, renewable energy, sustainable food, or are minorities, women or come from low-income communities. The bank prides itself with disclosing who and how it invests its loans transparently, as well as the how its portfolios are impacting communities.
Kat Taylor, and her husband Tom Steyer, already billionaires when they founded Beneficial State Bank in 2007, also focus their time and energy on climate change and food systems. Instead of donating grants and money as other foundations do, they are creating businesses to influence industry disruption in uniquely impactful ways.
Knowledge@Wharton’s Katherine Klein did a terrific interview of Kat Taylor in December, as did Conscious Company Magazine over the summer in July.
Sources: Knowledge@Wharton, Conscious Capital Magazine
