An interview with Marc Hock, President and CEO of Pinnacle Bank, 2017 Integrity Award Winner, and Business Ethics Alliance Trustee
By Robert Jin and Tyler Shields, Creighton University MBA Students
Pinnacle Bank began as a local community bank. It was started during the Great Depression in Palmer, NE (a town that now has a population of 474 residents) in response to many of the banks in the area closing their doors. Their business was centered on their community, and this same value is apparent in their current banks and staff. From a small town bank in Palmer, NE to a bank that now has 149 locations in eight states, Pinnacle has never forgotten its humble beginnings and small town Midwest values. They still attempt to service small towns that fit the customer base they are looking for around the Midwest. The sole focus of Pinnacle is to give back to the community in which they are located.
Marc was born in Lexington, NE and lived there until he went away to college at the University of Nebraska-Kearney. Marc has spent his whole professional career with Pinnacle Bank, a nod to his small town background. He began his rise in 1995 when he entered into the Pinnacle management training program. Marc found his way into senior management by the time he was 28 and often found himself driving around Nebraska with the founder of the company, learning about the business and the ethics that come with it. That relationship is still alive, as the 91 year old founder still exchanges phone calls with Marc, helping establish the consistency in culture that Pinnacle Bank is known for. Marc worked his way up in the business through hard-work and loyalty to his current position as President and CEO and remains involved both in his company and the surrounding area, keeping that community bank atmosphere alive with its commitment to its customers, employees, and the locals. As Marc said, “If operations are not done in an ethical manner, there won’t be success in the long run”.
Marc credits a lot of his personal ethic to his upbringing in the middle of Nebraska. In multiple instances, he referenced how his background in a western Nebraska town has shaped how he views ethical situations. He described his childhood as “I would get up, go to work, do the right thing, go to church on Sundays, and repeat.” His life was centered on doing what was right; it was never a question of what is right and wrong. If it was wrong, you knew it. Marc was able to sum up his views on ethics in one simple anecdote, ethics is “Doing what you say and saying what you do.” This ethic came out many times throughout the interview. He praised Pinnacle’s involvement in the communities in which they are located in and the management’s involvement in different community programs. Almost everyone in senior management at Pinnacle (including Marc) serve on some sort of civil board or community engagement group. This ethic is what has propelled him in both his business and personal life, as he sees no difference in ethics between his work at Pinnacle and his personal life. He had mentioned that initially, there was some disconnect between professional and personal work ethics. Eventually, however, these values intertwined and his associates and coworkers became friends and colleagues.
At Pinnacle there is currently no formal ethics program, but the ethics of the organization start from the top. They foster a culture that revolves around what Marc calls, “eating your own cooking.” They treat their customers and their business partners in the same way that they would want them to deal with them. Nowadays, people are too good at hiding behind the fine print and attorneys, so Pinnacle takes a more traditional but forgotten approach: be honest and open about every transaction. Although they may not win every deal, they have built a steadfast reputation as a firm, treating each individual transaction objectively and honestly. This not only allows them to sleep soundly at night, but it also gives them the opportunity to foster a long-term relationship with many of their customers. In order to help maintain this culture of honesty as an organization, Pinnacle finds that it is easier to promote from within their organization. When they embed culture into new hires early in their careers, culture becomes entrenched from the bottom to the top and vice versa over time. If the right culture is present in their management level, they are more likely to hire employees who share the same ethical outlooks. The company looks for a defined core set of values in their employees which include community (first and foremost), education and innovation. How does Pinnacle actually translate these values? “Community means being dedicated to where you work. Education is giving people tools to take advantages of future opportunities. Innovation is providing modern financial services in a traditional and more personal manner.” Marc summed up the ethical culture of the company very well with one line, “We want to hire people who leave their job place and the community it is in better.”
Marc was able to describe an easy ethical situation in which he found himself involved. There was a time when there was a loan that a customer applied for, and they brought in an appraiser to get a value of the land, but the appraiser wanted to value the property higher than it should have been. He offered to split the extra profit with the employee at Pinnacle Bank. They chose to not over-value the property because they knew that it would hurt the customer which would in turn, hurt potential future business with the customer. This would have been a situation where the company could have profited in the near-term, but their customers might have suffered later on and since their customers are their main priority, they passed. They chose to not lose the trust of their community for the possibility of a quick dollar. Marc was unable to come up with a hard ethical situation that he encountered, but in his words this, “may not be such a bad thing.” The fact that he is not able to remember a tough situation shows two important factors. First, Marc and Pinnacle are both well-grounded in his ethics. Ethical dilemmas and issues become very easy due to the tone the company sets from the get go, evident in the culture that’s been rooted through years of success. Second, it shows the integrity of Pinnacle is well known around the communities in which they are located. Other organizations do not even attempt to test the ethics of Pinnacle or its employees because they know the attempt is frugal.
Marc views punishments in two separate groups. First, if there is an employee who causes a full breach of confidence (embezzlement or harassment), they’re terminated on the spot, no questions asked. If there is only a partial breach of confidence, there is an opportunity for that employee to gain a second chance and will forgive as long as it becomes a learning experience for the employee. He envisions business ethics as a road map, and sometimes employees waver and drive on the shoulder or in the margins, but they quickly steer back on track. Everyone makes mistakes, learn from it and grow. Among learning experiences that Marc offered, he gave this warning. Young professionals today have a quest for easy money, and this can be a big issue for them. Social media causes a greater desire for quick money, as this generation of young professionals see what their peers are able to accomplish. Social media can also elevate the wrongs and unethical behaviors displayed by young professionals and the organizations they represent. He referenced the Wells Fargo debacle in which fake accounts were made to reach quotas implemented by upper management. Although there were not too many fake accounts, social media magnified the impact of these fraudulent accounts, tarnishing Wells Fargo’s reputation for the foreseeable future. Nevertheless, the idea of staying with one company for a long time rarely happens anymore in today’s day and age. Today’s generation’s tendencies to jump between industries frequently can cause ethical quandaries, and coupled with the desire for more cash, ends up breaking traditional ethics.
Marc embodies the idea of a traditional ethicist. He values hard-work and strong values. He is not afraid to tell someone when what they are doing is wrong, but he also cares enough about people to direct them towards what is right. Marc truly values the community he is involved in and the people he works with. Marc and Pinnacle Bank are the perfect examples of these “Midwest values.”