US Bancorp CEO Richard Davis (center)
David GoldmaN • Associated Press,
Davis chatted with theater artist Ericka Dennis during an opening reception for the new Twin Cities Habitat for Humanity headquarters building at 1954 W. University Av. in St. Paul on May 6.
jerry holt • firstname.lastname@example.org,
May 25: U.S. Bank CEO Richard Davis: 'Banker body, preacher soul'
- Article by: Adam Belz
- Star Tribune
- May 30, 2014 - 3:58 PM
He is a native of Southern California, a buttoned-down banker with no roots in Minnesota, and he looks like he could be directing a church choir.
So what was Richard Davis doing in Atlanta last week, leading the all-out and ultimately successful campaign to persuade the NFL to stage a Super Bowl in Minneapolis during the deep freeze of February?
These days, if it’s a high-stakes moment for Minnesota, the chief executive of U.S. Bank is almost always in the middle of it.
In his time away from commanding a corporate empire with 60,000 employees that churned out $5.8 billion in profit last year, Davis has emerged as a force and occasional flash point in his determination to shape the civic life of his adopted state.
He was in the thick of the long and bitter labor fight that consumed the Minnesota Orchestra. He was a key behind-the-scenes broker of the deal that led to the construction of the new billion-dollar Vikings stadium. He presides over local United Way fundraising drives, advocates for early childhood education, chairs the group that represents Minnesota’s CEOs and is a regular on the local early-evening speaking circuit.
“Banker body, preacher soul,” said Doug Baker, the CEO of Ecolab, a friend who has worked with Davis on many projects.
Davis, 56, frames his civic mission in simple terms: “People somehow think in for-profit business, the only job you have is to come in and make profit for the shareholders” he said. “We’re bankers, and it’s our role to get in the community and give, and give back.”
But big banks are hardly beloved, especially in the wake of the nation’s financial crisis and the toll it took on Main Street.
Under Davis’ direction, U.S. Bank avoided many of the missteps that plagued other large banks during the financial crisis, but the company drew criticism for its foreclosure practices. Protesters marched outside Davis’ house in Minneapolis in 2012.
He says he realizes that the only way to restore his industry’s reputation is one banker, one community at a time.
“It’ll be many years until banks as an industry are perceived as we wish they were and as they used to be, as the do-gooders making a difference in lives and helping America move forward,” Davis said. “We’re going to get there, if it’s the last thing I help with, but it’s going to take awhile.”
A painful lockout
Several of Minnesota’s largest companies are run by people who studiously avoid the spotlight and the controversies it can bring. Not Davis.
He makes a habit of stepping into the most contentious and complex issues in the state, such as the recent Minnesota Orchestra dispute. His role in that fight speaks to his civic priorities and his polite but unwavering style.
Davis was on the orchestra’s board at the time and presided over the contract talks with musicians that disintegrated into a 16-month lockout. The orchestra had been on a long hot streak, including a performance at Carnegie Hall in 2010 in which the New Yorker magazine’s music critic said the Minnesotans sounded like “the greatest orchestra in the world.”
When the board’s negotiating team proposed an average musician pay cut of 30 percent to balance the orchestra’s budget, talks imploded. Conductor Osmo Vänskä had threatened to resign in the fall of 2013, and Gov. Mark Dayton called board leaders to the governor’s mansion.
Dayton wanted the dispute settled — immediately.
The governor “laid into Richard,” said Doug Kelley, a board member who was present. As Dayton and Davis sat across a table from each other, the governor said he didn’t want to see any more inflammatory ads in the newspaper — from either side. He pointed his finger at Davis.
As Kelley recalls it, when the governor finished, Davis moved his glass of water to one side, leaned forward, and put his elbows on the table. Davis remembers saying something to the effect of, “Mark, do you believe everything you read? You know better than that.”
The two men parted amicably, Davis said. Kelley, a high-profile Minneapolis attorney, remembers it as a startling moment because Davis, known for being relentlessly gracious in person, had held firm.
“Here’s kind, sweet, warm, understanding, polite Richard Davis, and he just sat up, leaned right across the table and gave it right back to the governor,” Kelley said.
As the dispute wore on, the musicians, and then a cluster of legislators, demanded that Davis resign. At least two groups wrote letters demanding that he withdraw from the board of the Minneapolis Institute of Arts because of the problems at the orchestra.
One letter was written by Javier Morillo-Alicea, president of the SEIU Local 26, a labor union that represented the janitors at the Art Institute. Morillo-Alicea believed the banking industry had brought down the economy and that Davis had no right to “lecture” anyone on financial responsibility.
“The fact that bankers were so directly involved in a labor dispute, it’s not coincidental,” Morillo-Alicea said. “This is the way the economy is run. It’s just usually not this direct.”
A deal with musicians was ultimately reached with Davis’ blessing but not his direct participation, and he resigned from the board. Through a spokesman, the musicians declined to comment on him.
“I still love the orchestra, and I regret how painful and tortured that was,” Davis said. “But do I feel bad that I was trying to create a moment to sustain the financial wherewithal of a 100-year-old institution? Not at all.”
During the depths of the lockout, the student group Young Musicians of Minnesota played a protest concert outside U.S. Bancorp headquarters. Davis came down from the 23rd floor, stood to the side and watched the performance. He said he enjoyed it.
The students did not clearly advertise the reason for the concert, and U.S. Bank employees passing on the sidewalk mistakenly assumed that Davis had arranged for the performance. They thanked him. Always one to make lemonade from lemons, he said, he did not correct them.
“I didn’t mind turning it into a positive,” he said with a laugh.
A natural performer
A thin man in glasses with graying brown hair, Davis has been comfortable in front of a crowd since childhood.
He grew up the son of a truck driver and a receptionist in Hacienda Heights, a middle-class suburb on the east side of Los Angeles, and would often tag along to auditions with his sister, an aspiring actress.
When he was 7, she was trying out for a part as a munchkin in the Wizard of Oz. Someone asked if he was there to audition. He hadn’t been, but then he said he was. On the spot, he sang a few bars and did a soft-shoe dance.
He got signed as a member of the Lollipop Guild, a job that paid $2,000 a week. His mother was thrilled. She wanted him to get an agent and join the Screen Actors Guild like his sister.
But the prospect of performing every night and spending all his free time with “old people” didn’t appeal to the young Davis. He protested to his father — a “man’s man” who looked so much like Archie Bunker that he was asked for autographs — who intervened on his behalf.
Davis focused on school and sports — he ran track and played point guard on his high school basketball team — and dreamed of going to the Air Force Academy to train as a pilot.
He was accepted into the academy, but then was deferred after Congress passed a bill permitting women to attend the institution. Among already-admitted males, “I must have been last in, first out,” Davis said. “I hated finding that out.”
He calls that the biggest disappointment of his life. But he couldn’t wait a year for a deferred opening. He had no money, he said, and knew that his parents would not be able to support him.
He worked at Toys ‘R’ Us until he turned 18, and then took a job as a teller at Security Pacific National Bank. He attended night school at California State University, Fullerton, where it took him eight years to get a degree in economics.
At the bank, Davis quickly developed a strong reputation. Darell Choate had just joined Security Pacific in 1980 as a regional vice president. “There were seven regional VPs in those days,” Choate said. “Each of them came to me individually and said, ‘Keep an eye on this guy. He’s the guy.’ ”
Davis was 22.
By 1988 he was a 30-year-old senior executive at one of the country’s largest banks. In 1993, he followed his boss Jerry Grundhofer to Cincinnati’s Star Banc, which grew westward in the 1990s and bought U.S. Bank in Minneapolis in 2001. The new company kept the name and the Minneapolis headquarters. Davis, his wife Theresa and three children moved here from Cincinnati, and he has been CEO since 2006.
Davis says he felt almost anonymous in Los Angeles early in his career. But in Cincinnati, he realized he had the influence and connections to try to improve a community.
He says the Twin Cities, with the power and civic clout of so many Fortune 500 companies, “was like the perfect ingredient for me.”
Soon after he arrived, Davis took a call from R.T. Rybak, who was then the mayor of Minneapolis.
Rybak was trying to start a program that would give white-collar summer jobs to disadvantaged teenagers, and he needed companies to hire the kids. Davis wound up co-chairing Step-Up, which has since given 18,000 teenagers their first summer job.
Miles Swammi met Davis after a summer internship at Thrivent Financial, when both of them spoke at an event promoting Step-Up, where Davis still conducts mock interviews of students. Davis gave the high schooler his business card and asked him to get in touch. Over the years — as Swammi went through college and then business school and then a job — the two have become friends.
“He does believe that a component of his success was definitely hard work, but another component of it was luck,” said Swammi, who is a financial analyst at General Mills. “He takes a very clear stance on that. It’s a factor of grace, and he feels very fortunate.”
Davis also serves on the boards of several of the state’s most recognizable nonprofits. Many people he’s worked with say he takes a personal, active interest in the causes he puts his name behind.
On a visit in 2011 to the Catholic Charities Opportunity Center, a facility and program devoted to pulling people out of homelessness, Davis noticed that French toast was on the menu. Volunteers serve breakfast at the center every morning, and generally the meals are nutritious but not fancy, said Tim Marx, the CEO of Catholic Charities.
When Davis saw how much everyone enjoyed the French toast, and learned that for cost reasons it was a rarity, he committed U.S. Bank to pay for a hot breakfast every Friday and to provide volunteers to serve the food. “French Toast Fridays” is in its third year.
“It was Richard’s idea,” Marx said.
A few days before he flew to Atlanta for the Super Bowl pitch, Davis stood next to a window that looked out over the giant crater that will be the new Vikings stadium. Cranes swung, workers in neon yellow bibs scrambled all over, backhoes clawed at the dirt.
Davis was busy telling the reporters and TV cameras in the room how excited he was about a Super Bowl — and bluntly defending the divisive stadium project.
“I want to make this pretty bold statement. Whether you like the idea that we’re going to build a new stadium — get over it. We are. It’s an amazing thing. Look out the window,” Davis said. “The stadium is a great catalyst for this community, and now that we have the stadium, let’s leverage it.”
Davis was an early supporter of the stadium deal. He had personal experience of cities losing NFL teams. He left California just before the Rams moved from Los Angeles to St. Louis and arrived in Ohio just before Art Modell moved the Cleveland Browns to Baltimore.
“We know how this story ends,” he said in 2012. “If we don’t keep the Vikings, they move away. We build another stadium anyway, we get another team anyway, and we pay handsomely more for that.”
Davis and other CEOs started a nonprofit called the Minnesota Competitiveness Fund, hired Minnesota Wild Vice Chairman Jac Sperling as a lobbyist and threw themselves into building support for public funding. Davis kept in contact with the governor, Vikings ownership, the NFL’s front office and key legislators.
Critics of the stadium deal, even those who otherwise consider Davis a force for good in the Twin Cities, found the corporate advocacy troubling. Art Rolnick, the former research director at the Minneapolis Federal Reserve Bank, said he has privately challenged Davis on the new stadium, arguing that the benefit doesn’t justify the $498 million being supplied for it by taxpayers.
“I think from their point of view, they really believe this makes for a better community,” Rolnick said. “That’s the only way I can rationalize it. I’ve got a lot of respect for them, but we clearly agree to disagree on this one.”
And the line between corporate and community interests is blurry. Naming rights have not been announced. Nor has the lender whose help the team’s owners, the Wilf family, will need to finance their portion of the stadium’s construction cost. U.S. Bank could be a natural fit for both.
Davis declined to say whether the bank is pursuing either opportunity.
Landing a Super Bowl
Ten days ago, Davis was asked in a press conference if he was prepared to face “the biggest sharks in the shark tank,” the NFL owners.
Davis runs a company that turns enough profit to buy five NFL teams every year.
“We could do it right now,” he said. “We just want to make sure it’s choreographed.”
Davis and former Carlson Cos. board chairwoman Marilyn Carlson Nelson — another deeply engaged corporate leader — honed the choreography in an Atlanta hotel ballroom last Monday. The next day as they waited to give the presentation, they sang “We Are the Champions.” Then they stepped to the stage to give their 15-minute pitch.
When NFL Commissioner Roger Goodell appeared on a TV screen to announce the result of the vote, they leaped from their chairs. It was a victory for the state, for stadium supporters and for Davis. He jumped up and down, shouted and embraced Carlson Nelson.
Davis had just resigned from the orchestra board in January when Dayton, who faced off with him last fall, called to ask his help leading the Super Bowl bid. Davis said yes — “he’s my governor,” he said — and quickly helped raise $30 million in pledges from companies around the Twin Cities.
“He’s just come off what has to be a horrible experience with the orchestra, but right away he says, ‘I’ll do it,’ ” Dayton said. “It does say something very impressive about him that after going through all that, he was immediately willing to step in.”
Adam Belz • 612-673-4405 • @adambelz
© 2015 Star Tribune