Sustainability is increasingly monopolising covers, banners, and an important space in the decision-making process of customers, thus forcing companies to incorporate it into their processes, suppliers, materials, marketing campaigns, etc.
However, how is sustainability understood from the world of banking? Which areas can be improved on the environmental or social level? There are many innovations in a field where collaboration between the public and private sector is closer. That is why banking has turned its rather defensive attitude towards this new factor into the transformative element of its business model.
Financial inclusion as part of the sustainability strategy
Sustainability in the banking sector is mainly aimed at contributing to the improvementof society, and financial inclusion plays a key role in this respect. If we have a look at regions like Latin America, we will find out that many banks have decided to bring their services closer to people lacking financial capacity so that they get the chance to have a bank account.
But this access is not enough; people need to be educated to understand the functioning and learn basic knowledge which will allow them to manage all their money, something which does not occur in all countries or social categories. Thus, banking is faced with a major challenge in this field, which is why it will need the support and the collaboration of public and private bodies, walking towards a banking institution belonging to all of us and for all of us.
The boost of banking to sustainable investment
Another point on which banking is likely to have a great impact on sustainability and on the environment is investment management. In this way, they will have the capacity to create spaces which take the sustainability of the different projects into account when it comes to putting them in touch with finance companies. Hence, the bank may become a sort of “Green Hub” which promotes this type of investment. Indeed, there is already an initiative called European Green Deal which is aimed at orientating investments towards ecological and social sustainability to achieve climate neutrality by 2050.
Banking seeks sustainability from within
Internally, regardless of its indirect impact, the financial sector is trying to contribute to objectives like the battle against climate change. In fact, at the COP25 held in Madrid in 2020, over 20 institutions reached an agreement to reduce the carbon footprint on their balance sheets.
ESG criteria are already at the core of entities, which are committed to fair salaries and inclusive teams, and to reducing the use of plastic or paper at their offices. As simple as these gestures might seem, they can make a significant contribution to the environment. Technology also appears to be a great ally in the transition towards sustainability; that is why we try to integrate it into our value proposition for the bank, in which sustainability becomes essential to live up to our customers’ expectations.