Today at its Global Roundtable in Paris, UN Environment Finance Initiative (UNEP FI) and 28 banks from around the world are launching the Principles for Responsible Banking for public consultation. Together the banks represent over USD 17 trillion in combined assets, and CEOs from 10 of the banks are attending the launch. ING and Triodos Bank are among the founding banks.
The Principles will define the banking industry’s role and responsibilities in shaping a sustainable future. By committing to the new framework, banks will be aligning their business with the objectives of the Sustainable Development Goals (SDGs) and the Paris Climate Agreement.
The Principles set the global standard for what it means to be a responsible bank and will ensure that banks create value for both their shareholders and society. They provide the first global framework that guides the integration of sustainability across all business areas of a bank, from strategic to portfolio to transaction level. By signing the Principles for Responsible Banking when they are launched in September 2019, banks will commit to being publicly accountable for their significant positive and negative social, environmental and economic impacts. They agree to set public targets on addressing their most significant negative impacts and scaling up their positive impacts to align with and contribute to national and international sustainable development and climate targets.
By developing the set of principles, the 28 founding banks set out a clear purpose for the banking industry itself, and also enable investors, policy makers and regulators, clients and civil society to compare banks and hold them accountable for their environmental, social and economic impacts and their contribution to society’s goals. Signing the Principles will be a serious commitment: banks that continuously fail to meet transparency requirements, set adequate targets and demonstrate progress will face removal from the list of signatories.
Signing the Principles for Responsible Banking is something that all banks that are genuinely committed to sustainability should consider, regardless of their starting point. With differentiated requirements for starter, intermediate and advanced banks on sustainability integration and detailed implementation guidance they provide an entry point for early stage banks while creating a race to the top among those most advanced.
The Principles are now entering a six-month global public consultation period before they will be signed by banks from around the world at the United Nations General Assembly in New York in September 2019. Banks and stakeholders around the world are invited to provide feedback and input to guide their further development, and to signal their support by becoming Endorsers of the Principles for Responsible Banking.
Satya Tripathi, UN Assistant Secretary-General, UN Environnment said, “The global banking industry is stepping up to the sustainability challenge. I’m optimistic we’ll see a realignment of business practice – one that embraces the fact that green and socially responsible business is the best business.”
Christiana Figueres, convener Mission 2020 and former Executive Secretary of the United Nations Framework Convention on Climate Change (UNFCCC), urges banks to join the initiative, stating: “The Principles for Responsible Banking align the banking industry with the Paris Agreement and with the Sustainable Development Goals, they are frankly long overdue, and they demonstrate a clear commitment from the banking industry to assume its defining role in creating a sustainable future. The only future that is acceptable, and profitable for everyone. Every bank should become a signatory, and all regulators, investors, policy makers and civil society should support the banking industry as it adopts and implements the Principles for Responsible Banking”.
Daniel Wild, Co-CEO of RobecoSAM said: “The Principles for Responsible Banking will drive the banking industry’s alignment with the Paris Climate Agreement and the United Nations’ Sustainable Development Goals. We are integrating part of the requirements of these Principles in the RobecoSAM Corporate Sustainability Assessment (CSA), the leading annual survey of companies seeking to benchmark their sustainability performance and competing for membership in the Dow Jones Sustainability Indices (DJSI). Banks that want to be best in class in the CSA and members of the DJSI should therefore seek to align with this new global standard”.
Martin Skancke, Association Board director Chair of the Principles for Responsible Investment (PRI) said: “The PRI have helped drive the integration of environmental, social and governance considerations into investor decision-making. It is now time for the banking sector to step up in both assessing the risks they are exposed to, and the impacts of their financing activities in realising the Sustainable Development Goals”.
The 28 founding banks developing the Principles for Responsible Banking are from five continents and over 20 countries:
Access Bank (Nigeria), Arab African International Bank (AAIB) (Egypt), Banco Pichincha (Ecuador), Banorte (Mexico), Barclays (United Kingdom), BBVA (Spain), BNP Paribas (France), Bradesco (Brazil), Commercial International Bank (CIB) (Egypt), CIMB Bank (Malaysia), First Rand (South Africa), Garanti Bank (Turkey), Golomt Bank (Mongolia), Hana Financial Group (South Korea), Industrial and Commercial Bank of China (ICBC) (China), ING (Netherlands), Kenya Commercial Bank (KCB) Group (Kenya), Land Bank (South Africa), National Australia Bank (NAB) (Australia), Nordea (Sweden), Piraeus Bank (Greece), Santander (Spain), Shinhan Financial Group (South Korea), Societe Generale (France), Standard Bank (South Africa), Triodos Bank (Netherlands), Westpac (Australia), YES Bank (India)
To find out how you can take part in the global public consultation, click here.
