What Could Sustainable Banking Look Like?

I am delighted to share some insights from our latest in-depth case study on our Global Research Project 'In Search of Sustainable Business'...

Triodos Bank: More Green, Less Greed.

Triodos Bank is one of the world’s leading sustainable banks. Although not as large as some of the mainstream banks yet, Triodos now has a balance sheet worth €4.3 Billion, and is one of the largest investors in renewable energy in Europe.

Sustainability is at the heart of the Bank’s mission, to make money work for positive social, environmental and cultural change. The Triodos business model is based on lending to, and investing only in organisations that benefit people, society, and the environment.

As such, Triodos helps its customers to deliver sustainable outcomes. For example, Triodos-financed renewable energy projects in 2011 generated enough power to meet the needs of nearly 1.5 million households in Europe, saving over 2 million tonnes of CO₂ emissions.

The Triodos case study doesn’t consider how an organisation was driven by sustainability to change as such, as these principles have always been at the very heart of what Triodos is about. It is more an exploration of what a company, operating within financial services, can look and operate like, if sustainability is truly integrated into its DNA – strategically and operationally.

The Triodos story also provides another interesting example of how sustainability and profitability are not mutually exclusive concepts, even in the world of financial services.  As well as driving towards, and influencing a more sustainable world, Triodos delivers consistent and growing returns.  The Bank generated a net profit of €17.3 million in 2011, up by nearly 50% on the previous year.

Triodos Bank truly walks-the-talk, integrating sustainability principles within its own operations. This includes carbon neutral banking, through energy reduction and efficiency measures, eco-efficiency buildings, allied to appropriate offsets. The Bank also has a good focus on sustainable resources.

Triodos Bank also shows us how alternative ownership models can work. All Triodos Bank’s shares are held in trust, and are traded via a ‘matched-bargain’ market. This approach protects the integrity and independence of the business and helps maintain its long-term focus.

The quality of sustainability reporting is also very strong, demonstrating visibility and transparency. It is also the first bank to publish 100% of the loans it makes.

While there are many lessons in eco-efficiency and ethics, this case study also provokes much thought on the development of sustainable business models and strategies in support of the transition to a more sustainable economy – if a financial services company can do it, then anyone can.

Follow this link to download and read the full in-depth case study.