JPMorgan Chase to invest $30 million in Greater Paris

Rue Gabriel Péri, a
pedestrian zone in Saint-Denis, Seine Saint-Denis,
France.
Myrabella/Wikimedia
Commons

• JPMorgan Chase is investing $30 million over the next five
  years in the Greater Paris region of Seine-Saint-Denis.
• The money will be in the form of grants for job training and
  mentorship.
• It is the first investment of the $500 million global
  
  AdvancingCities initiative.
• This article is part of Business Insider’s ongoing series on
  Better
  Capitalism.

JPMorgan Chase announced Monday that starting January it will
begin a five-year, $30 million dollar investment in
Seine-Saint-Denis, a region of France to the northeast of Paris.
It’s an area marked by high unemployment, crime, and
homelessness, and has 28% of its population living below the
poverty line.

It also, however, is on the cusp of two developments that
JPMorgan wants to take advantage of: the 2024 Olympics  —
Seine-Saint-Denis is home to France’s national soccer and rugby
stadium — and the Grand Paris Express rapid transit line that
will connect Greater Paris

As Stephanie Mestrallet, JPMorgan’s vice president of global
philanthropy in Europe, told Business Insider, “OK, we know that
there are these issues, we know that a lot of people are going to
invest in these areas — can we add to this effort that is
currently happening?”

The money will go toward apprenticeship programs for young
people, job retraining programs for older adults, and small
business development.

The investment is a continuation of JPMorgan’s philanthropic
commitment to the region and will be the first made from the $500
million AdvancingCities initiative when it begins in January.
AdvancingCities is itself a five-year program that the bank
developed as an extension of investments into Detroit in 2013,
after CEO Jamie Dimon decided to assist the city after it
declared bankruptcy.

The bank found its Detroit project so successful that it made
similar investments in Chicago, Washington, DC, and the New York
City borough of the Bronx. Advancing Cities is built upon the
lessons learned in these American cities over the last five
years.

The initiative has two components, involving a competition among
cities around the world that want help with kickstarting their
economies, as well as investments outside of the contest.
Seine-Saint-Denis falls into the latter, and Peter Scher,
JPMorgan’s head of corporate responsibility, said that the
150-year anniversary of JPMorgan’s involvement in France (when
JPMorgan’s business partner opened a firm there) this November
was a great occasion to move forward with a project they deemed
ready to go.

JPMorgan had sent 16 employees to the area this past spring to
get familiar with the area and see if there were necessary
conditions for successful investments. They decided there indeed
were. And though the AdvancingCities competition is still
fielding proposals from more than 1,000 cities for the rest of
the month, Scher said, “When we feel like we’re ready and we can
make the investments we do.”

Using lessons from Detroit and London

When Scher explained AdvancingCities to us in September, he said
that one of the key takeaways from their initial work in Detroit
was that the level of partnerships on the ground is contingent on
the success of the investments. That is, the bank’s team has to
rely on business and government leaders in each respective region
to determine where money will be best spent and loaned.

In Seine-Saint-Denis, the French President Emmanuel Macron’s
administration is involved in the project, and the minister of
employment, Muriel Penicaud, will join Dimon on Tuesday in an
announcement press conference at the Les Compagnons du Devoir
(LCD) charity in the region. JPMorgan partnered with the charity
last fall and made a 460,000-euro investment into apprenticeship
programs.

The AdvancingCities initiative as a whole utilizes both low-cost
loans and philanthropic spending, but this upcoming $30 million
investment will be entirely in the form of grants. They will
support more apprenticeship programs like those offered by LCD,
as well as small business accelerators like Impact Partenaire and
Pact PME.

Scher said the JPMorgan will send around 100 employees from its
global offices to assist with these programs over the next five
years, as it has done with its previous city investments.

He said that the Great Paris initiative’s success will be
measured by effects on employment rates and small business
growth, particularly in the poorest sections of the region. The
AdvancingCities team is using its insights from its American
projects, as well as how the bank’s investments in East London
during the 2012 London Summer Olympics affected the city’s
economy, for Seine-Saint-Denis’ benefit.

“I think it demonstrates that not just the challenges are quite
similar wherever you go, but many of the solutions are quite
similar,” Scher said.