Good morning,
“CFOs and finance professionals sometimes get typecast as solely focused on debits and credits or the numbers. Maybe it was warranted at a point in time. But I think CFOs today are more strategic business partners to the CEO.”
That’s what John Rainey, CFO and EVP of global customer operations at PayPal, told me in a recent conversation.
The financial health of his own employees is one place PayPal has vowed to do more, as discussed in the fintech company’s recent 2020 Global Impact report. A key metric? NDI, or net disposable income, i.e. the money left after paying taxes and living expenses. Many entry-level and hourly employees had an NDI of 4-6% when PayPal CEO Dan Schulman decided in 2019 to set a goal to increase employees’ NDI to 20%. PayPal has reached 18%.
This movement at PayPal was sparked by a visit to a food bank, says Rainey.
“A few years ago, when a group of PayPal employees were volunteering at a food bank in Arizona, we were made aware that some of our employees were actually going to use that food bank,” Rainey says. “We talked so much about financial inclusion, and we realized we had work to do in our own house.”
PayPal began its employee financial wellness initiative. The company set out to address the needs of workers through approaches such as pay increases, giving every employee equity in the company, and addressing the cost of medical insurance, says Rainey.
Leadership agreed there was a good probability of getting this done without the company bearing any additional costs, he says.
How? PayPal combated costly employee attrition with the enhanced financial benefits.
“People in our call centers were leaving for other jobs simply because they were higher paying,” says Rainey. “If we could reduce that attrition, then we could actually reduce the training costs for new employees. So, we were rigorous in measuring that. And it actually panned out as we suggested.”
The company’s earnings hit a record $1.1 billion in the first quarter of 2021 compared to $84 million in the first quarter of 2020.
“Profit and purpose are not mutually exclusive,” says Rainey.
See you tomorrow.
Sheryl Estrada
sheryl.estrada@fortune.com
Big deal
A Gallup report released May 17 continues research on remote-worker trends. A component of the report focuses on four occupational categories in which the majority of employees continue to work from home amid the coronavirus pandemic.
Going deeper
A new study by the Association of Certified Anti-Money Laundering Specialists (ACAMS) and Oliver Wyman examines key steps needed to improve anti-financial crime (AFC) compliance culture from the perspective of industry professionals including chief compliance officers. About 58% of survey respondents said the most needed improvement is a greater investment in AFC technology. The study also pointed to four components of a strong AFC culture: strategy and risk appetite; tone from the top; accountability and incentives; and training and communication.
Leaderboard
Shawn Guertin was named EVP and CFO at CVS Health, effective May 28, 2021. Guertin worked at Aetna for eight years, where he was EVP, CFO, and chief enterprise risk officer.
Irena Melnikova, Ph.D., was named CFO at Umoja Biopharma, a biotechnology company. Melnikova joins Umoja from SVB Leerink, an investment bank, where she served as a managing director in investment banking.
Steve Priest was named CFO at eBay Inc., a global commerce company. Priest will join the company on June 21, 2021. He most recently served as CFO at JetBlue.
Overheard
“We want people well-matched to their skills and experience. That’s what helps the economy run better.”
—Heidi Shierholz, a senior economist at the Economic Policy Institute, on workers finding jobs amid the coronavirus pandemic that are better suited to their abilities, as told to the Associated Press.
