How might "value-based banking" contribute to strengthening overall banking in the face of continued worldwide turbulence following Covid-19?
Now more than ever, banks are eager to join the movement. Our focus on value and doing good has resonated with more and more people. And when people save the planet, the planet is safe. We are not only working with banks, but we are also working with many other financial companies that basically want to do good. At the time of covid-19, and after that, our relationship has improved not only with other banks but also with all of our clients and customers. If it can maintain its current state, it will strengthen the whole banking sector.
What role do you think environmental, social, and governance (ESG) challenges will have in the future of business?
If ESG issues are supported by principles and aim, they can be highly helpful. Otherwise, ESG becomes more about process than impact.
Big words like ‘social impact,' ‘climate action,' and ‘sustainable' have quickly entered the banking businesses lexicon. These words won't be actually transformational unless they are in line with the company's core beliefs. ESG, for instance, will only be effective if senior leadership has a thorough understanding of and agreement on the social and environmental impact it aims to achieve through the business.
Could you tell us about the achievements of values-based banking since the foundation of the GABV?
The GABV, made up of 70+ pioneering banks, credit unions and microfinance institutions from across the world, advocates for banks to take a pivotal role in shaping the economy, society and the environment.
Values-based banks have the ambition to put people and the planet at the center of decision-making. With strong diversity in terms of size, business model, cultural contexts or markets they operate in, they have a goal in common; to use finance to meet their communities needs and create a positive impact.
Leading by example; every day proving another approach to banking is possible
Strengthening the members of the GABV through programmes like PCAF (Partnership for Carbon Accounting Financials) or the leadership academy, equipping the leaders of a future fairer, greener and more inclusive banking sector
Members of the GABV have pioneered and helped expand initiatives like the Partnership for Carbon Accounting Financials (PCAF), a harmonized, open-source tool to measure and disclose the greenhouse gas emissions (GHG) of financial institutions' loans and investments.
The GABV has been recently recognised as a Climate Leader by the Finance for the Future Awards and will take part in COP27 as an Observer NGO.
Why is it important to work in a global alliance like the GABV?
Sunrise Banks' perspective - could include access to innovative approaches, to inspire rather than imitate. Also, some direct commercial benefits as some members have invested in others.
CEO of Sunrise Banks, USA David ReilingEgypt is currently hosting the COP27 Conference on Climate Change. What steps should banks take, in your opinion, to address the climate change crisis? Do you have a special message for November 9th, Finance Day?
Banks should commit to something and follow through. Speaking is easier than acting, but it's obvious that the world needs both audacious goals and the guts to pursue them.
Take advantage of the chance that the climate emergency is giving us. This is a truly once-in-a-lifetime chance to tackle the most pressing issue of our time. Banks can lead the way in promoting positive change that will benefit our children and their children's children by doing this.
At the occasion of the COP27 ‘Finance Day', the GABV urges the financial sector, including values-based banks, to live up to its commitments.
At last year's COP26 Conference in Glasgow, UK, mainstream financial institutions issued welcome public commitments and declarations designed to tackle climate change and help facilitate the move towards net zero.
One year later, many of them continue financing the fossil fuel industry at an industrial scale. A recent report by Finance Watch estimates that 60 of the largest global banks still have around $1.35 trillion of exposure to fossil fuel assets.
The GABV is also celebrating its annual Banking on Values Day with the theme: Real Impact Behind the BIG Words during the Dhaka meeting. Why do you say that, exactly?
On the eve of the COP27 Climate Change Conference in Egypt (November 6 to 18), a leading global network of values-based banks calls upon the financial sector to back up its rhetoric with actions.
The Global Alliance for Banking on Values (GABV) will mark Banking on Values Day on November 10 by reaffirming the crucial role that banks have to play in tackling the root causes of climate change.
Banking is never neutral - institutions make decisions about what they finance and invest in, and these have major impacts on the shape of our collective future. Over recent years, mainstream banks have increasingly positioned themselves around their social purpose and environmental goals. Now, this rhetoric must be backed up by real commitments and action.
For Banking on Values Day 2022, the GABV and its members call out the increasing use of the ‘greenwashing' vocabulary in the financial industry.
With the theme ‘Real Impact Behind the BIG Words', the campaign focuses on how values-based banks mean what they say and deliver real impact. A global virtual panel discussion will take place on November 10 with leaders from the Banking on Values movement about the risks of greenwashing and what it means to aim for real impact.
