A new report from the Global Alliance for Banking on Values (GABV), co-funded by the Rockefeller Foundation, makes a powerful business case for sustainable banking.
The performance of sustainable banks, which base their decisions first and foremost on the needs of people and the environment, were compared to 29 of the world’s largest and most influential financial institutions. In a number of key areas, including return on assets, growth in loans and deposits, and capital strength, the sustainable banks outperformed their mainstream contemporaries – sometimes substantially.
‘This report shows that doing good benefits the banks,’ says Luis-Felipe Derteano, Chairman of Grupo ACP, the parent company of Mibanco, a Peruvian microfinance institution and one of the co-founders of the GABV. ‘And not just in a theoretical and ethical sense. These banks are doing well when measured against conventional benchmarks such as the financial bottom line.’
Derteano continues: ‘The report’s findings are crucial for a global banking industry which has tremendous potential to affect positive change through its ability to lend money to finance entrepreneurs and stimulate local economies. Most importantly, it shows that a sustainable approach to banking offers all of us the prospect of a stable, prosperous future.’
The GABV, which now has a total of fifteen members but is continually growing, believes the new report highlights sustainable banking’s growing relevance.
‘Clearly, there is growing demand worldwide for values-based banks that have a triple bottom line approach to banking, balancing people, the planet and prosperity,’ says Tamara Vrooman, CEO of Vancity, Canada’s largest community credit union and GABV member. ‘Our challenge now is to meet this growing need for lending and other bank services among people traditionally unserved or underserved by the big banks.’
Read more, including a summary and full version of the Strong, Straightforward and Sustainable Banking report here.