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Banking

Crédit Agricole plan flaunts modern mutualism

Medium-term plan targets same efficiency and little ROE increase, but client growth and new social motto please mutualists and Macron.

There are hard political reasons why Crédit Agricole formally set out the rationale for its existence – for the first time, it said – in its new medium-term plan on Thursday. 

Not least is president Emmanuel Macron’s new law, passed through parliament in April, which cuts the obligations of smaller businesses towards their employees, while encouraging bigger businesses to officially acknowledge their duties to a wider set of social and environmental stakeholders, as well as to their employees: and not just to the stock market.

“Working every day in the interest of our customers and society” is the bank’s new motto.

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Philippe Brassac

This relegation of financial investors, however, might come relatively naturally to Crédit Agricole, whose clients already own the group’s backbone. 

Indeed, a similar reaffirmation of the group’s mutualist ethics of socially conscious liberalism lies behind Philippe Brassac’s campaigns, since 2008, to bring the governance and business of the listed central vehicle he now runs – Crédit Agricole SA (CASA) – back into the fold of the group’s 39 regional cooperative banks, which own the majority of CASA.

Brassac’s new plan will serve to “amplify our mutualism commitment” to social and client goals, in a context of “growing societal expectations” on businesses. Before the crisis, after all, CASA and the regional banks had separate strategic plans. Now the entire group must strive to be “the European leader in responsible investment”. 

That means more investment in enterprises in the so-called social and solidarity economy, arranging more social bonds, and strengthening the Grameen Crédit Agricole Foundation.

Usefulness

Fundamentally, the plan reaffirms a strategy of selling a wide array of products to millions of customers – firstly at the regional banks – as the basis of what Brassac calls its “usefulness", and its “unique relationship model”.

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