Edinburgh-based Ethical Finance Hub has become the first Scottish-focused financial body to endorse the United Nations Environment Finance Initiative’s (UNEP FI) Principles for Responsible Banking.
A coalition of 49 banks, including Barclays and Santander, have committed to aligning their strategy, portfolio and business practices with the Sustainable Development Goals (SDGs) and the Paris Climate Agreement. The Ethical Finance Hub is amongst the first stakeholders to endorse the Principles that provide a global framework for banks to integrate sustainability across all business areas; from strategic, to portfolio, to transaction level.
In 2015 Scotland was one of the first countries in the world to sign up to adopting the SDGs. With the SDGs now embedded into the country’s National Performance Framework the Scottish Government is leading by example through its focus on wellbeing, and sustainable and inclusive economic growth. The Principles align well with the traditions of the Scottish banking industry which, over the past two centuries, has pioneered movements focused on inclusion, stewardship and governance.
Julian Parrott, Director and Board Member, Ethical Finance Hub “The Ethical Finance Hub aims to create a fairer, more inclusive and socially responsible financial system and we see the Principles for Responsible Banking as an important, and necessary, framework that will support the global banking sector to take a consistent and measurable approach to sustainability. We are committed to promoting the draft Principles for Responsible Banking within our networks and welcome this exciting opportunity to work with UNEP FI and partners to raise awareness and encourage adoption.”
Simone Dettling, head of the Banking team at UNEP FI said: “It is fantastic to see this coalition growing so quickly. The Principles for Responsible Banking are rapidly setting the global standard for what it means to be a responsible bank. We invite banks that haven’t endorsed them yet to join and show their commitment to the sustainable banking system of the future.”
The Principles are currently out for global public consultation until May 2019 and will become available for signature in September 2019, during the UN General Assembly. The transparency and accountability mechanism of the Principles will require signatories to address their most significant impacts, set public targets and report back on progress.
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Ethical Finance Hub
The Ethical Finance Hub (EFH) is a Scottish Government-backed, industry-led initiative launched in 2016. The EFH aims to enhance local connectivity by assisting individuals and organisations interested or active in the ethical finance market via:1) providing a local Hub work base to operate from, 2) capacity building programmes; and 3) enhancing awareness and delivering market focused research. Our vision is: to realise a financial system where integration of environmental, social, governance and faith based values become the norm and not the niche.
Principles for Responsible Banking
- The six Principles for Responsible Banking that banks commit to are:
- Alignment: We will align our business strategy to be consistent with and contribute to individuals’ needs and society’s goals, as expressed in the Sustainable Development Goals, the Paris Climate Agreement and relevant national and regional frameworks. We will focus our efforts where we have the most significant impact.
- Impact: We will continuously increase our positive impacts while reducing the negative impacts on, and managing the risks to, people and environment resulting from our activities, products and services.
- Clients & Customers: We will work responsibly with our clients and our customers to encourage sustainable practices and enable economic activities that create shared prosperity for current and future generations.
- Stakeholders: We will proactively and responsibly consult, engage and partner with relevant stakeholders to achieve society’s goals.
- Governance & Target-setting: We will implement our commitment to these Principles through effective governance and a culture of responsible banking, demonstrating ambition and accountability by setting public targets relating to our most significant impacts.
- Transparency & Accountability: We will periodically review our individual and collective implementation of these Principles and be transparent about and accountable for our positive and negative impacts and our contribution to society’s goals.
For more information about the Principles visit www.unepfi.org/banking/bankingprinciples
- The Principles were launched by the Founding Banks’ CEOs on 26 November 2018 in Paris at the UN Environment Finance Initiative’s biennial Global Roundtable and the 4th Climate Finance Day, under the patronage of the French President Emmanuel Macron.
- The Principles are now in a six-month global public consultation period until 31 May 2019 before they will be signed by banks from around the world. Banks and stakeholders 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.