Nine new banks are backing the UN’s Principles for Responsible Banking – an initiative launched last month to “align the banking industry with society’s goals as expressed in the Sustainable Development Goals and the Paris Climate Agreement”.
Standard Chartered, KBC Group, KB Financial Group, DGB Financial Group, Natixis, GLS Bank, Landsbankinn, Zenith Bank and Keystone Bank have joined the original 28 founding members, bringing the total of supporting banks to 37.
In addition, the body has been endorsed by the European Banking Federation, the Natural Capital Coalition, SITAWI Finance for Good, the Spanish Banking Association, the European Association of Co-operative Banks, the BBVA Microfinance Foundation, the Spanish Confederation of Savings Banks and the Dutch Banking Association.
The principles have been out for public consultation since the end of last month, and will be finalised and ready for signatories next September. In the meantime, the UN Environment Programme’s Finance Initiative (UNEP FI) is calling for banks to become supporters of the efforts. Simone Dettling, UNEP FI’s head of banking, described them in a statement as providing “an actionable framework for banks of any size and at any starting point to align their business strategies with society’s goals”.Currently, the Principles have six pillars:
1. Align with the Paris Agreement and the SDGs
2. Increase positive impact in banking activities
3. “Work responsibly with clients and our customers to encourage sustainable practices”
4. Engage with relevant stakeholders to ensure sustainable outcomes
5. Set public targets around achieving impact on sustainability, and implement a responsible banking culture internally.
6. Annually review and disclose progress
If these are codified after the consultation process, it will make them a more ambitious counterpart to the UN-backed Principles for Responsible Investment – the cornerstone of the ESG market for the past decade. Also comprising six principles, the PRI was created before the Paris Agreement and the SDGs, so instead focuses on less concrete ambitions, such as “incorporating ESG issues into investment analysis and decision-making processes”, promoting disclosure and pushing the principles themselves as part of the commitment.
The Principles for Responsible Banking are open for feedback until May. UNEP FI will host webinars every six weeks with supporting banks, to discuss expectations and developments.