MEMORANDUM
Subject: CSR Program Proposal for Columbia Bank
This memorandum proposes a corporate social responsibility program for Columbia Bank with a focus on student loan debt in our community. This CSR program could be implemented in addition to the community and customer events currently arranged on the branch level. Columbia Bank, and the local communities we serve, would greatly benefit from offering a CSR program that focuses on educating high school students, college students, parents and any potential borrower on the long-term implications of excessive student loan debt.
Student Loan Debt and Our Community
The first sentence of our mission statement reads, “We will increase shareholder value and enrich the communities we serve by creating financial success together with our customers and career success together with our employees.” One of the greatest hurdles individuals face in reaching financial success in our country, and particularly in the Washington D.C area, is student loan debt. According to an article in the Washington Business Journal written by Jeff Clabaugh (2013), “Credit monitoring firm Credit Karma Inc. says the average student loan debt among borrowers in D.C. in August was $42,873, almost 50 percent higher than the national average. Maryland ranks second-highest for student loan debt, with an average balance of $31,791 (para. 1-2).” This debt prevents many college graduates from buying a home, saving for retirement, and investing.
Student Loan Debt and its Financial Impact
According to comments cited in an article by the Consumer Financial Protection Bureau (2013), “The current generation of first-time homebuyers is inhibited by a heavy student debt burden that may hurt their ability to qualify fo...
... middle of paper ...
...ing an in-state college, saving for college before attending, and working while in college. We will provide a budgeting and financial planning worksheet. We will also discuss and distribute a brochure that describes the student banking and other services Columbia Bank offers.
Next Steps in the Process
Through this CSR program, Columbia Bank has an opportunity to help the citizens of our community make better financial decisions that could have a positive impact for the rest of their lives. Please join me on Tuesday, November 26 at 4:30 p.m. for a detailed presentation followed by a question and answer session to learn more about the program. I will also provide a checklist for implementing the program by January 1, 2014.
Please contact me at ashley.baker@columbiabank.com with any questions and to confirm your attendance at the presentation on November 12.
Martin and Lehren’s article “A Generation Hobbled by the Soaring Cost of College” addresses the issue faced by current and former college students dealing with large amounts of debts due to student loans. The article presents the reader with stories of former college students who have either graduated or dropped out, and their struggle to pay off their student loans. The article also talks about issues such as students not being informed about high amounts of student loans and why student debts have increased. Martin and Lehren also make the issue of student debt more intimidating by giving examples
A majority of mortgage defaults that Americans used were on subprime mortgage loans, which were high-interest-rate loans lent to people with high risk credit rates (Brue). Despite knowing the risks, the Federal government encouraged major banks to lend out these loans to buyers, in hopes, of broadening ho...
Carneval, director of Georgetown University’s Center on Education and the Workforce agrees that going into debt until you’ll be earning more money is the way to pay for your education. “The only thing worse than borrowing is not borrowing and not going to college at all,” stated Patrick M. Callahan, president of the National Center for the Public Policy and Higher Education. Lauren J. Asher, President of the Project on Student Debt group, states that the financial risk has increased. Ms. Asher points out that more students graduate with at least $40k in student-loan debt, “People lose control of their finances, and sometimes they make choices you wish they hadn’t made.” Darla M. Horn, an organizer of the student-loan-debt art show in Long Island City, NY realized she hadn’t been aware of how much money she had borrowed while in college. Referring to herself as financially illiterate, she found herself “just signing the documents and faxing them
...hew , and Debbie Cochrane. "Student Debt and the Class of 2012." Institute For College Access and Success. December (2013 ): n. page. Web. 12 Dec. 2013.
To understand the student debt crisis, one must first understand what caused it and what results from it. College undergraduates use student loans to finance the cost of tuition, room, board, transportation, and personal expenses while attending (Gage and Lorin). Student loans are different from other forms of debt because basic consumer rights like bankruptcy protection don’t apply to students who default on their loans. As a result, students are virtually locked into their debt, offering them little to no ability to refinance it. Solutions to debt problems like consolidation are available to students but that process doesn’t involve shopping for a better deal from competing lenders like it does in other debt areas. Therefore, interest rates often remain high and the loans remain with the original lender (Vanegeren). As Kayla Webley expl...
Most people today accept the debt that comes from college. Students consider student loan debt as a “good debt.” They see other students make this mistake but follow their path anyway. Nearly 80% of college-bound students have not projected the total amount of money they will need to graduate college.
Children of the twenty first century spend nearly 13 years in school, preparing for what is college, one of the only ways to achieve the so-called “American Dream”. College is the best way to start an advanced career and go further than one possibly could if college degrees were not available, allowing people to achieve their view of the American Dream; whether it be large houses, shiny cars, multiple kids, or financial comfort, college is the stepping stone to achieve the American Dream. But all great things come with a price, college dragging along debt. Students who attend college struggle to find ways to pay for it, leading to applying for student loans. These loans a great short term, paying for the schooling at the moment but eventually the money adds up
As of 2016, American students have accrued a massive 1.3 trillion in student loan debt. Just 10 years ago, the nation’s balance was only $447 billion (Clements). This ever-present cumulative burden has caused many post graduate Americans to delay important life events such as marriage, homeownership and children because of this substantial encumbrance (Clements). The debt will only continue to grow with neglect, so the most effective action to take would be eliminating the cost altogether.
In the context of how the system works, the only conclusion to accurately draw is that the odds are effectively stacked up against the college student of average means, especially considering the rise of lending organizations like Sallie Mae and the fall of Consumer protections (Collinge 4-5). Since the advent of the GI Bill and the understanding of the common virtue of education in the post-WWII era of the U.S. the message behind the collegiate experience has gone full circle. Since the 1970’s, with the continual amendments to the Higher Education act, lending companies have only become more powerful, enacting “draconian collection” strategies while simultaneously subtracting seemingly all consumer protections including bankruptcy protections, statues of limitations and refinancing rights (Collinge 4.) All of these factors make the modern student loan complex “an inescapable and profitable...
Today in the United States two thirds of graduating students leave colleges and universities with student debt. The Institute for College Access and Success began an initiative called “the Project on Student Debt” to estimate just how much student debt has been accumulating over the years. What they found was that the average student will graduate with $26,000 in debt and in more extreme cases, over $100,000 dollars in unpaid loans. These numbers have serious underlying implications, not only for student borrowers and their lenders but rather the entire national economy. With more than a quarter million graduating students every year, the national student debt has amassed to over $1.2 trillion dollars – or about 6 percent of the country’s total debt, and twice the size from 2007. While Americans already struggle to pay credit card and auto loan debts, the national student loan debt is larger than both, second only to mortgage loan debt. Those burdened by unpaid loans aren’t the only ones affected however, business owners, corporations and employees alike will be touched by the stresses a huge debt can put on an economy. As unpaid balances accumulate people will spend less money where they can. Consumer spending drives the economy; without it businesses will profit less, employee wages will be cut and loans will continue to go unpaid.
“New Data Confirm Troubling Student Loan Default Problems.” Project on Student Debt: Home. N.p., n.d. Web. 29 Oct. 2013. .
With the ever-increasing tuition and ever-tighten federal student aid, the number of students relying on student loan to fund a college education hits a historical peak. According to a survey conducted by an independent and nonprofit organization, two-thirds of college seniors graduated with loans in 2010, and each of them carried an average of $25,250 in debt. (Reed et. al., par. 2). My research question will focus on the profound effect of education debt on American college graduates’ lives, and my thesis statement will concentrate on the view that the education policymakers should improve financial aid programs and minimize the risks and adverse consequences of student loan borrowing.
An organization’s Corporate Social Responsibility (CSR) drives them to look out for the different interests of society. Most business corporations undertake responsibility for the impact of their organizational pursuits and various activities on their customers, employees, shareholders, communities and the environment. With the high volume of general competition between different companies and organizations in varied fields, CSR has become a morally imperative commitment, more than one enforced by the law. Most organizations in the modern world willingly try to improve the general well-being of not only their employees, but also their families and the society as a whole.
A corporations CSR should be shaped in order to fit the goals of the corporation, although every corporation’s CSR should differ, since most have different goals and different communities behind them. The CSR should be molded into fitting the corporation’s goals in order to make it easier on the corporation in giving back to the community while achieving its goals. For example, a corporation located in a desert wishes to be more efficient, by reducing water usage it is not only creating lower costs, which result in higher revenue, but also helps the community by not taking up so much water. Taking this into consideration, it is critical that the corporation goals and values are established and clear throughout the corporation, they should be developed by the board or directors and CEO, and the highest managerial level should stress their importance to the rest of the corporation. By making the goals and values at the top branch of the corporate hierarchy, it will be simpler for the corporates community to develop in order to nurture those goals and values. Therefore, a corporation can reach the “shared-value,” a value for both its shareholders and community in a simpler manner that can result benefiting the corporation in the end as well. Throughout the article many examples are given of actual corporations that have benefited and changed their CSR in order to fit their goals, therefore, providing solid proof that these methods work. Nevertheless, as acknowledged by the author’s themselves, most of the corporations taken into consideration where one’s that Harvard CSR students were employed
...oncerns to the forefront of businesses. In this paper I have suggested that business can improve both socially and economically by incorporating and integrating a CSR program, guided by God’s love, into their strategic planning. Strategic planning of CSR creates a mutual beneficial relationship between a community and a business organization. The community wins by having a business that is sensitive to their needs and responsive to their concerns, and the business wins by developing competitive advantage in the market that leads to long-term profitability. A business needs to incorporate God’s love when developing CSR policies in order to maintain the trust and the integrity of the relationship with the community. With solid strategic planning coupled with CSR, businesses can set the direction that provides the greatest benefit to themselves and communities.