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Leadership Banking from a Truth ‘Teller’

by Guest Writter
Daniel K. Walker, CEO and Chairman of the Board, Farmers & Merchants Bank

Keeping your word.

Seems like such a simple statement, a statement that could very well form the foundation of every person’s daily creed. But it doesn’t. We all know many people who make promises but don’t keep them . . .  People who say one thing but mean another. . . . People who take the easy way out, forgetting that keeping their word is the most important thing of all.

 I don’t think anyone is immune to this failing, but it’s most noticeable in the political arena and in the world of business – two areas where failing to keep your word can destroy your reputation. Headlines give us high-profile examples every day. Everyone from the president of the United States to the chairman of the board of a Fortune 500 company can stumble when it comes to keeping their word.

I consider myself a man of my word. But I’m certainly not perfect and I know there are instances when I just haven’t been able to do what I said I was going to do. But mostly, keeping my word is one of my guiding principles. Given the opportunity to write something about character, which goes hand-in-hand with keeping your word, has made me stop and think about how and why people either have character, or don’t. When you think about the people you interact with, it’s fairly simple to put most people into one of two categories: those with integrity and those who fall a few rungs short.

I remember one of my very first influencers, my grandfather Gus Walker. He was the second president of Farmers & Merchants Bank and when I was a young man he made quite an impression on me. He sat me down one day when I was a teller and said, “Dan, I can forgive almost anything you do, but I can’t forgive a lie.” Grandpa understood that people make mistakes, but someone who could look you in the eye and say an outright lie, well, he had no use for that and that really stuck with me.

I made my personal choice to keep my word and tell the truth. And I’ve certainly been tested a number of times, difficult situations when it would have been far easier not to tell the truth, or not to stand up to a tough situation. A time came when a shareholder forced a lawsuit. Our bank, now 107 years old and closely held, has thrived through four generations of Walker family management. But this shareholder faction threatened to undermine the bank’s vision and I, as CEO, became the center of attention. Its times like these that drive character; its when you understand that this event, and how you deal with it, establishes the kind of person you are. It was a highly emotional situation, and it mattered what I said, how I said it and who I said it to.

Looking back, it really wasn’t difficult to maintain my position because there was no reason to waiver, there was no middle ground. I followed the bank’s values of honesty and integrity and just said and did what I needed to say and do. Yes, it was an emotional time, but you can’t let that interfere. Someone asked me if it is a burden to uphold these values on a daily basis. They wanted to know if I felt constrained by this role. The truth is, this is hardly a singular role. I have a small group of trusted advisors, with like values, who share this role with me.

There’s a word people often use today –- transparency. It’s a bit over-used but I think it’s the right word for how we carry out our guiding principles. And it’s something that goes way, way back to C.J. Walker, my great-grandfather, who started the bank in 1907. We try very hard, at all times, to be truthful to everyone we deal with – our employees, our customers, the guy down the street.

Sometimes people don’t like our truthfulness. We say things they don’t want to hear. For example, a few years ago a long-time customer came to see us asking for a very sizeable loan to expand his business. His business already had grown about four-fold but he felt he could go much farther, growing it into a national footprint. Well, we didn’t agree. We liked him and liked his business, but doubted his expansion model. We thought it would lead to his demise, and we told him just that as we rejected his loan application. We could have sugar-coated it, but we wanted him to know the truth, as we saw it. He got pretty upset with us but we did not want him to risk his losing his business or us losing our loan. As it turns out, he was right and we were wrong. Our instincts were incorrect. But fortunately he appreciated our candor and to this day he remains a good customer with personal accounts.

Employees are another area where character counts. We all have opinions. We don’t have to agree, we can agree to disagree. We have quite a few employees who have been with us for several decades, Our CFO is celebrating his 50th year with us this year – and he’s one of my trusted advisors. Our employees are empowered, given the opportunity to have opinions and make decisions. They know they won’t be fired just for having a different opinion or perhaps making a decision that is later proven in error. But just like my grandfather Gus told me, if they don’t tell the truth, the relationship is broken. And they are gone.

The battle for character isn’t really a battle at all. If you have to stop and think about whether or not to keep your word, and fight the urge to stretch the truth a bit, there’s little chance for leadership with integrity. And whether it’s in the political backroom, the corporate suite or just someone’s family room at home, keeping your word can be the single most important action taken.


About the Author

Daniel K. Walker serves as Chairman of the Board and Chief Executive Officer of Farmers & Merchants Bank based in Long Beach, Calif., and also holds the positions of Chairman of the Board and President of Farmers and Merchants Trust Company. Walker is the fourth generation Walker to serve at the helm of F&M Bank. Founded in 1907, F&M Bank today is considered one of the strongest banks in California and is among the top 150 banks in the nation. Walker has been part of F&M Bank for more than three decades and has held nearly every position in the company. From his first job as an elevator operator at the age of 14, to the executive titles he now holds, his dedication to growing and strengthening the F&M organization is unsurpassed.

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