“Green Buildings”Wells Fargo’s Commitment to the Environment
By Jessica Melendy, Student
2 May 2013
Abstract: This study seeks to explore how successful Wells Fargo is at carrying out their CSR and Sustainability initiatives. It is particularly interested in Wells Fargo’s “green building” campaign and their Wells Fargo Regional Foundation. In conducting this research, it becomes clear that Wells Fargo is attaining their goals with regard to the construction of LEED buildings; however they are struggling to maintain a positive public image with their Wells Fargo Regional Foundation because of the nature of its exclusivity.
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Introduction
Wells Fargo’s “green building” campaign has been a very successful CSR and
sustainability program for their organization. The purpose of this campaign is to “lead by
example through [their] own operations. [It] is critically important [for them] to ‘walk the talk’
and do [their] part to help protect our environment” (Wells Fargo, 2013). They are currently in
the process of achieving LEED recognition for all of their retail banking stores, representing
about 6,000 buildings or approximately 30 million square feet. Already, nineteen of their office
buildings meet LEED standards or are ENERGY STAR 2010 rated. Wells Fargo is also a
participant in the U.S. Green Building Council’s LEED for Volume program. Their Duke Energy
Center is the first and tallest office tower to have ever received the highest level of certification
under LEED. They have installed and activated solar panels on 11 banking stores in the Metro
Denver area. Those systems have helped Colorado avoid 296 metric tons of greenhouse gas
emissions. In addition, they have reduced their greenhouse gas emissions by 12%. Wells Fargo’s
“green building” program has made it possible for them to have received a 2011 leadership
award from the U.S. Green Building Council for their commitment to environmentally
responsible building design, construction and operation. By 2020, they hope to have achieved a
40% increase in energy efficiency, a 65% waste diversion rate, a 35% reduction in absolute
greenhouse gas emissions and 35% of their buildings will have achieved LEED certification.
The Wells Fargo Regional Foundation was established in 1998 and aims to help low
income communities in Eastern Pennsylvania, Delaware and New Jersey plan and implement
community building programs. The Foundation has invested hundreds of thousands of dollars
into the revitalization of desperate communities in need. There are seven guiding principles that
Wells Fargo follows when making grantmaking decisions include: compelling, comprehensive,
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accountable, sustainable, collaborative, replicable and inclusive. If an application meets these
requirements, the board will then make a decision based on how well the applicant has met these
criteria. The Foundation has been under scrutiny, however, because of the fact that Wells Fargo
is a multi-billion dollar corporation but the amount of funds that they are allocating to a
relatively small region in the United States is quite low. This study seeks to explore the ways
with which Wells Fargo executes these CSR and Sustainability initiatives and the overall
outcomes of these endeavors, to date.
Background
Founded in 1852, Wells Fargo is a national bank, with global operations, and is one of
the highest rated banks in the country. Wells Fargo prides itself on being a community-driven
bank, despite its growing size. Headquartered in San Francisco, they service one in three
households while providing over 9,000 banks and 12,000 ATM’s nationwide. They claim to be
devoted to customer service by offering the best online banking experience. According to their
website, they proudly serve 70 million customers in over 130 countries across the globe (Wells
Fargo Website, 2013). Their key stakeholders include: their staff, employees, maintainers,
customers, competitors, investors and the various communities to which they belong.
Wells Fargo’s competencies include their ability to benefit local communities by offering
educational programs, funding neighborhood enrichment projects, small businesses and non-
profits. The execution of their “green building” campaign is a positive way that the organization
has been able to show that sustainability is one of its top priorities. Some of their core
competencies include the fact that they have managed to stay superior and relevant during the
economic crash of 2008 while holding a better credit rating than all of their competitors. The
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strategy in their vision that “we want to satisfy all our customers’ financial needs and help them
succeed financially” has been quite a prominent feature in their slogan (Wells Fargo Vision,
2013). They fulfill this promise by offering unique loan packages and education tutorials with
their community driven structure.
Wells Fargo has a sufficient following on Twitter, Facebook and successfully uses RSS
feeds. These pages allow their stakeholders the opportunity to voice their opinions and develop
feelings of intimacy with them. Wells Fargo uses these technologies to discuss a variety of
topics. One of their twitter pages is entirely devoted to responding to posts regarding customer
satisfaction or dissatisfaction. They address each client specifically with a promise to follow up.
Their other twitter page offers links to blogs, topical stories and tips on retirement. Wells Fargo’s
Facebook page is not as elaborative as their Twitter page but still allows their stakeholders
access to their newsfeed. Their RSS feeds are more informative and are a helpful ways for
customers to gain knowledge about the corporation. Unfortunately, Wells Fargo is lacking a CSR
blog, an active Pinterest account and has a weak presence on Facebook.
Wells Fargo’s five primary values include: seeing their team members as a competitive
advantage, ethics, doing what’s right for their customers, diversity/inclusion and leadership.
They understand that retaining hardworking, honorable employees is crucial because customers
count on the competency of those in charge. They prefer to call their employees ‘team members’
because of the friendly nature of the term. This also allows them to highlight their investment in
“team work”. They believe that a business should be judged by what they do, not by what they
say. In doing what’s right for their customers, Wells Fargo is able to sustain itself by continuing
to provide a trustworthy banking experience. The focus on diversity and inclusion has also
allowed Wells Fargo to preserve itself as they service more demographics by acting responsibly.
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Wells Fargo believes in leadership and feels as though it is their obligation to develop and help
the communities with which they serve, while ensuring customer ease by emitting confidence,
responsibility and strength.
Corporate Social Responsibility is a relevant factor because of the “five identifiable
trends” that make it absolutely necessary for an organization to succeed in today’s market,
including: growing affluence, ecological sustainability, globalization, the free flow of
information and brands (Werther & Chandler, 2011). Wells Fargo is aware of these trends and is
focused on trying to keep up for the sake of success. They understand how growing affluence
affects the competitiveness of the financial industry. They strive to earn customer loyalty and
trust by offering programs geared toward educating them on responsible financial spending.
They strive for ecological sustainability by lessening their paper waste and by promoting their
“green building” campaign. They have globalized their company and are now servicing “over
130 countries worldwide” (Wells Fargo Website, 2013). The “free flow” of information is
readily available on their site with links to documents and reports. They are also using their
Twitter feeds as a way to communicate freely with their audience. Wells Fargo has branded itself
by being “a community-based, diversified financial services company.” (Wells Fargo's Who are
We Page, 2013).
There are several different types of arguments for CSR and sustainability and Wells
Fargo realizes this. The moral argument implies that an organization is obligated to “repay the
debt it owes society for its continued business success” (Werther & Chandler, 2011). It is the
organization’s duty to perform at a responsible level that is beneficial to society. This applies to
sustainability because an organization’s understanding of societal responsibilities is directly
correlative with their ability to sustain a business in the environment with which they thrive.
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Wells Fargo calls itself a community based bank and contributes to neighborhood enhancement
projects. In addition, Wells Fargo’s “green building” operation is crucial in their commitment to
CSR and sustainability on a moral level. The rational argument for CSR suggests that if an
organization fails to act in accordance with societal expectations, they will no longer be able to
sustain themselves and may flounder economically. Wells Fargo continues to devote their energy
to ensure that this does not happen. The economic argument for CSR combines the moral and
rational arguments and concludes that adherence to both arguments is directly related to
economic prosperity and sustainability, as is evident with Wells Fargo’s corporate standing
today.
The five environmental forces propelling a greater interest in CSR include: growing
affluence, ecological sustainability, globalization, communications technologies and brands.
Growing affluence is an environmental force propelling business interest in CSR because most
CSR attentive businesses are located in developed countries. Wells Fargo is a global bank;
however they are headquartered in San Francisco. Wells Fargo is concerned about the
environment as part of their sustainability program because of their moral obligation to society.
They strive to reduce their paper waste. Wells Fargo has a global presence and is using social
media to take advantage of the internet in order to reach target audiences and key demographics.
Findings
Within this discussion of Corporate Social Responsibility and Sustainability I have
researched Wells Fargo in an effort to better understand their approach to sustainability and the
strategy that they have used with regard to CSR. Wells Fargo has a reputation for being one of
the nation’s most reliable, eco-friendly banks. Their “green building” campaign is consistently
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praised as altruistic and groundbreaking. Yet, Wells Fargo still faces scrutiny over their
foreclosure rate and the fact that their corporate giving is insignificant in comparison with their
net worth.
The Wells Fargo Regional Foundation funds neighborhood projects in low income
communities in the areas of Delaware, New Jersey and Pennsylvania. In doing this, Wells Fargo
is able to support their “community based bank” slogan by essentially rebuilding troubled areas.
However, because Wells Fargo has a net worth of over a trillion dollars and they are only
contributing a minute fraction of that amount to these projects, they have come under attack for
trying to use this initiative as a way to gain positive CSR publicity.
Wells Fargo prides itself on being an advocate for low-income communities. However,
according to Marnie Tisot (2013), “giving a community what [Wells Fargo] thinks it needs
[despite good intentions], [it is] positioning the community as a beneficiary rather than a
stakeholder” (3). The fact that Wells Fargo is only giving up a fraction of their net worth to these
struggling communities, in a relatively small region of the United States, it is appearing as
though the bank is not genuinely interested in the outcome.
Wells Fargo is also making negative press by its foreclosure rate. According to Andrea
Torres (2013), “Wells Fargo Bank wants to foreclose on an old 180-unit low-income rental
community that has been getting government aid for nearly two decades to keep prices low in
Homestead” (p.1). There have been protests across the country at various Wells Fargo locations
because of these foreclosures. Unfortunately, there is not much that Wells Fargo can do about
this because it is essential for a financial institution to ensure that it stays above water and acts
accordingly to unpaid loans.
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Another initiative that Wells Fargo is invested in is the installment and funding of “green
buildings”. Wells Fargo has taken this campaign very seriously in an effort to help preserve the
environment at all costs. Wells Fargo “announced it will plunk down $30 billion in loans and
investments aimed at building a greener economy” (Kho, 2012). The bank has already “received
a leadership award from the U.S. Green Building Council for its commitment to environmentally
responsible building design, construction and operation.” (The Charlotte Business Journal, 2011,
p.1). By all accounts, Wells Fargo is a pioneer at constructing a greener corporate world one
building at a time.
Wells Fargo is not alone in its effort to conserve the economy. More and more
organizations are interested in “going green”. Nestle is another corporation that is committed to a
greener future. Leon Kaye (2013) writes that “Nestlé has publicly committed for the first time to
make “forward-looking commitments” to social and environmental sustainability.” (p.1). Like
Wells Fargo, Nestle is invested in launching a new CSR/Sustainability campaign. Wells Fargo
and Nestle are both focusing on short-term goals that are tangible and easily attained. Like Wells
Fargo, they are investing millions of dollars in responsible environmental tutorage, as far as
consumption and production are concerned. They also have an established timeline, like Wells
Fargo, with 2020 as the year that they hope to have achieved their goals. Among their many
initiatives, they are going to be reducing greenhouse emissions by 35%.
Another environmental investment that Wells Fargo is committed to is a non-profit
organization called Imagine H20. According to a press release distributed by WaterWorld.com
(2013), “Since its inception in 2008, Imagine H2O has: attracted over 200 water startups from
more than 15 countries to its competition program, provided over $1 million of in-kind services
and cash awards to more than 25 new businesses, helped its portfolio companies attract over $15
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million in investment from angel investors, venture capital funds and project finance funds and
offered campus water entrepreneurship workshops to over 1,000 students” (p.1). Wells Fargo has
been a supporter of this organization since 2009.
Strengths Wells Fargo is effectively producing
Green Buildings and reducing their
carbon footprint through Ecological
Sustainability.
Wells Fargo is still one of the
nation’s most reliable banks.
They have shared their CSR report
with stakeholders and have
maintained transparency through a
free flow of information.
They are essentially corporate
activists in the production of LEED
buildings.
Weaknesses
They have come under scrutiny for
the Wells Fargo Regional
Foundation.
Wells Fargo has recently made news
for their increasing number of
foreclosures.
They have a weak Facebook
presence and a lack of fresh social
media dedicated specifically to CSR
and sustainability.
High Foreclosure Rate
Opportunities In continuing to partner with
environmental non-profit
organizations, like ImagineH20,
Wells Fargo can continue to gain
popularity within the eco-friendly
circle.
Wells Fargo needs to dedicate social
media to their sustainability
initiatives because they are doing a
lot more good environmentally.
Threats The increasing number of
foreclosures is diminishing Wells
Fargo’s public image while
strengthening that of their
competitors.
A lack of up to date social media is
corporate suicide.
Unfavorable public perception
because of recent bad press with
regard to the Facebook scandal.
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They also need to expand their
outreach globally.
Wells Fargo has had little involvement with social activism in the past. In actuality, they
have gone out of their way to remove themselves from as much social turmoil as possible. For
example, they do not have a public relationship with Idle No More and Keysotone XL, which are
two of the major current social issues today. The bank tries to remain silent on these topics
unless they are forced into action. For instance, when activists from Occupy Wall Street desired
a meeting, Wells Fargo graciously allowed them into their offices and heard them out. Dick Price
(2013) reports that “Wells Fargo executives met with six key activists involved in various
Occupy movement forces in Los Angeles. [They] expressed satisfaction that their concerns had
been heard by leaders of the banking giant, but frustration that little concrete action had been
taken and no promises made for future steps.” (p.1). Wells Fargo offered hope that they would
do whatever they could to accommodate the cause, however hardly seemed invested in that
promise. Recently, they had to block several Facebook users from posting on their page in
resistance to home foreclosures happening across the country. Wells Fargo does not have a very
good Facebook page or Twitter account, as far as their CSR and Sustainability efforts are
concerned. Much of their social media presence is informative and self-centered.
In addition to studying the specific corporate social responsibility and sustainability
efforts of this firm, I have also researched what similar firms in this industry are doing in this
area. Like Wells Fargo, FleetBoston is investing in environmentalism. In 2001, it was the first
bank in the world to endorse both the CERES principles and the United Nations Environment
Programme Statement by Financial Institutions as part of its environmental management
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program. ING has been measuring, tracking and monitoring its performance in the ethical, social
and environmental field since 1995 and is considered to be one of the leading fortune 500
companies. Also, Union Bank pledges to follow "Green" building protocols, like Wells Fargo. In
addition, Bank of America supports green businesses by purchasing energy efficient office
equipment and by financing green organizations.
The findings of this research project hope to shed light on the argument as to whether or
not CSR and sustainability are equally meshed in the company culture. The question of where
CSR falls with regard to public relations and to business practices, and how sustainability
correlates, is also being addressed.
Conclusion
This case study examined Wells Fargo’s sustainability and CSR initiatives, particularly
that of their Green Buildings and the Wells Fargo Regional Foundation. Their Green Buildings
campaign has been very successful with regard to the fact that they received a leadership award
from the U.S. Green Building Council and have already converted 19 of their offices to meet
LEED standards or are ENERGY STAR 2010 rated. Their future goals are achievable and
altruistic. However, The Wells Fargo Regional Foundation is facing scrutiny because of the fact
that they are only contributing a minute fraction of their finances on the limited communities that
they are serving. What does this mean for the Wells Fargo Regional Foundation? Should they
incorporate a broader region into their focus? Wells Fargo needs to expand their level of
outreach while simultaneous elevating their budget if they want to truly make a difference and
not seem as though the project is simply for show. Are their Green Buildings enough to keep
their public perception positive? It will only benefit Wells Fargo to continue to pursue this
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campaign with the mindset of truly making a difference on the environment, as future studies
will be able to better illustrate.
References
Charlotte Business Journal. (2011, October 7). “Wells Fargo earns Green Building Council’s leadership award”. Charlotte Business Journal. Retrieved April 9, 2013 from http://www.bizjournals.com/charlotte/news/2011/10/07/wells-fargo-earns-green-building.html
Guevarra, L. (2011, September 26). “Wells Fargo, Bloomberg, Malkin Named Green Building Leaders”. GreenBiz.com. Retrieved Aril 10, 2013 from http://www.greenbiz.com/news/2011/09/26/wells-fargo-malkin-bloomberg-named-green-building-leaders
Kho, J. (2012, April 23). “Wells Fargo to invest $30B in environmental financing”. GreenBiz.com. Retrieved April 9, 2013 from
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http://www.greenbiz.com/blog/2012/04/23/wells-fargo-commits-30b-sustainability-investments
Price, D. (2012). “Wells Fargo Meets Occupy: Where There’s Smoke There’s Smoke?”. LA Progressive. Retrieved April 9, 2013 from http://www.laprogressive.com/wells-fargo-meets-occupy/
Tisot, M. (2013, February 11). “Community relations: much more than CSR”. Quiblo. Retrieved March 27, 2013 from http://professionalservicesolutions.net/blog/view/1631/community_relations__much_more_than_csr
Torres, A. (2013, April 9). “Wells Fargo Bank wants to foreclose on Homestead affordable-housing complex”. The Miami Herald. Retrieved April 8, 2013 from http://www.miamiherald.com/2013/04/09/3332496/bank-wants-to-foreclose-on-homestead.html
TriplePundit. (2013, March 17). Nestlé Promises More Shared Value on Nutrition, Water & Rural Development. http://ow.ly/iRtK2 (Twitter post). Retrieved from https://twitter.com/triplepundit/status/313780626933284864
Water World.com. (2013, February 28) “Wells Fargo invests in leading water innovation accelerator, Imagine H2O”. Waterworld.com. Retrieved April 9, 2013 from http://www.waterworld.com/articles/2013/02/wells-fargo-invests-in-leading-water-innovation-accelerator--ima.html
Wells Fargo Website “https://www.wellsfargo.com/”
Werther, W. & Chandler, D. (2011). Strategic Corporate Social Responsibility. Washington DC: Sage.
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