Green Standards and Policies for Banks
A brief overview
Presentation at
Briefing International Rivers
Beijing, April 19 2011
Johan Frijns, coord@banktrack.org
提纲 Outline
1. About BankTrack （银行监察组织的简介)
2. Why do we need Green Finance? (society, banks)
3. Where to start? Standards and guidance for banks
-> Next sessions at GP training – what NGOs can do to push banks
forward
Global NGO network: 36 members and partners
银行监察组织是由全球36个民间机构组成的网络
Each with specific focus
关注多种多样的议题
Dams
大坝
Corruption 贪污腐败
Cluster bombs
Large mines
集束炸弹
大规模采矿
Nuclear power
核电站
Human rights
人权
Targeting the bank behind the problem is smart strategy
把倡导目标指向问题背后的银行是一个聪明、有力的策略
How do we impact on banks? “4T Approach”
Track
Trouble
Talk
Tell
We are facing a huge challenge
其挑战很大….
…things are not so well lately..
并且最近的情况不是很好….
Banks operate in a world facing multiple, interconnected crises
water crisis 水资源欠缺
climate change
globally organised
crime, drug wars
气候变化
vanishing
species
vanishing forests
森林破坏
生物的灭种
Overfishing 过度捕鱼 Pollution污染
conflict and war
hunger, poverty
粮食缺乏
population
growth, mass
migration
exploding cities
大规模的城市
人口增长
Land shortages
土地冲突
“Banking; a clean, high tech service industry
minimal environmental and social impact”
“银行业看似是一个干净、高科技产业，其环境和社会影响较低”
Banks DO have a choice; be part of the problem..
Or mobilise capital for real solutions to the crises
With real win win benefits for banks
•
New Business
Opportunities
Do no harm is not good enough, do well
Better Risk
management
Strong Reputation
•
Bank as responsible part
of society
Transparency,
accountability
Profit through long
term Value creation
Strong Bonds
with clients
There is value is doing well
Savings through
efficient operations
• Doing well must be organised
Proud employees
“Okay okay, we are convinced; now what?”
Formulate
Ethics and Values
Develop
Business Strategy
伦理与价值观
商业策略
Rethink
Risk vs Opportunity
风险与机会
Design and adopt
appropriate
policies that fit
mission
Good policies:
1. Start from explicit mission and vision of bank on role in society
2. Provide criteria for which clients to do business with, and which not..
3. Provide criteria on what business to engage in, and what not..
4. provide stringent criteria on client conduct in operations to be financed
5. Spell out responsibilities of banks themselves
6. grant rights to, and respect rights of, other stakeholders, genuine
influence in process
7. Seek transparency of process
8. Include guarantees for accountability, external review
9. Contain arrangements for dealing with grievances and problems
10.Seek societal benefits next to bank / client benefits
Tools available – no need to start from scratch
1. International laws and treaties
2. UN/OECD led initiatives
3. National law – best practices
4. Civil society / business joint initiatives & standards
5. Bank / Business initiatives
6. Bank policies – best practices
1. International Law and Treaties
UNFCCC / Kyoto /
Durban…
Convention on
Biodiversity
UNDRIP
Convention on
Chemical and
Biological weapons
• government obligations, but banks, like everybody, need
to work towards fullfillment of treaties
• human rights norms for non state actors, business
Protect, Respect and
Remedy framework
• universally accepted norms, not Northern standards
2. UN/OECD led initiatives
• Initiatives of UN agencies or OECD
• part cooperative efforts with business
• ‘Standards’ on labour, human rights, environment
OECD Guidelines for
• ‘Soft law’ or voluntary commitment, but evolving
Multinational
• Mixed impact on activities business and banks
enterprises
• For NGOs reference in campaign work
UN Principles for
UNEP finance initiative
Global Compact
全球契约
Responsible Investment
3. National laws and best practices
China - Green
Credit policy
Belgium - law on
investments cluster
munition
Netherlands –
banking code on
bonus payments
• National laws setting standards on
investments and bank performance
Norway – human
rights regulation
national
petroleum
(pension) fund
• Example for banks designing policies for their
own investments
4. Civil society / business joint initiatives & standards
• Multi stakeholder initiatives
• Often started by civil society groups
• Standards for sectors or on issues
• Certification schemes
• Possible criteria for investors/lending
5. Bank / business initiatives
• Initiatives of banks on specific challenges
• Industry associations develop standards for sectors
• often response to civil society but no involvement
• guidance for investments and project design
• yardstick for campaigners
6. Individual Bank policies
Where it is all ending up
• All standards and norms need translation on bank level
to have any impact on lending and investments
• Some banks already set standard, best practice
• other banks can follow practice, or adopt as group
No financing
• NGOs can push banks towards better policies
of tar sand oil projects
Partial retreat from coal
power plants
Stringent human rights
policy
Ban on investments
arms
5. Will it taste good?
• Not without the Soul Within (mission, ethical vision)
• Not when just following the recipy (tick box mentality)
• Not when using poor ingredients (poor implementation)
• Not when recipy is kept secret (no transparency)
• Not when eaten alone (no stakeholder involvement)
• Not when eaten outside in sand storm (crisis, regulation)
How to get banks there?
To discuss further during finance training tomorrow…
Thank you!
www.banktrack.org
Johan Frijns <coord@banktrack.org>