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1996
Banking, the Environment and Sustainable Development

At the 1992 Earth Summit, the United Nations Environment Programme (UNEP) brokered the Statement by Banks on the Environment and Sustainable Development. Three years later, with UNEP’s support, the Green Alliance carried out a survey of the banking sector to see how its activities had changed since the signing of the Statement. Their findings were a key input to this Consultation.

By 1995, there was already evidence of a building values shift in Europe, with the public and media reactions to Shell’s activities in the North Sea and Nigeria. Controversies such as these tended to show a particular pattern: they would hit industry first and then, later, their ripple effects would start to impact the service sector, often starting with the insurance industry.

The Foundation’s Fifth Consultation, run by the Green Alliance, took place against a rapidly evolving political context, in which major business institutions were under growing public pressure. It provided a timely opportunity to test the preliminary results of the banking sector survey and allowed in-depth discussion between banking professionals and other commentators on some of the key questions raised. The results made an important contribution to the Green Alliance Report, Banking on the Future, which provides practical guidance to banks and pointers to future priority issues.

Banks must think longer-term

Among the key conclusions:

• The sustainable development challenges facing the banking sector are increasingly long-term, which often makes them harder to anticipate and manage.
• There are important – and often unrecognised – links between the sustainable development agenda and the nature and level of risk assessment carried out by banks.
• Most banks still need to establish effective environmental management systems.
• There is a growing need for appropriate indicators/performance measures, for use right across the banking sector.

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