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Real Economy – Real Returns

The Business Case for Sustainability Focused Banking

In 2013 banks with business models based on the Principles of Sustainable Banking have once again demonstrated higher financial returns than the largest banks in the world. These sustainability focused banks, with a social, environmental and economic triple bottom line at the core of their business models, deliver these results while continuing to be focused on meeting the needs of their clients through lending and deposit products.

Executive Summary

A sustainable real economy requires enterprises that deliver economic resiliency, environmental preservation and social empowerment to the communities in which they operate. These enterprises need not only direct investment capital but also access to financial services including lending, deposit and cash management products typically delivered by banking institutions. Without these banking services these enterprises will not be successful. Banking institutions that focus on meeting the banking services needs of these enterprises must in turn deliver adequate financial returns to attract the capital required from investors to support their growth.

Since the financial crisis that became evident with the collapse of Lehman Brothers in 2008, a group of sustainability focused banks, all members of the Global Alliance for Banking on Values (GABV), have demonstrated through their focus on the real economy, their strong capital positions, and their steady financial returns that banking models based on the Principles of Sustainable Banking provide viable and needed alternatives adding strength to a diverse financial ecosystem.

In 2013 these banks continue to show that lending to the real economy delivers better financial returns when compared with the largest banks in the world. This conclusion is supported by recent research on returns delivered by banks focusing on shared value. Furthermore these banks address a very real need of enterprises for banking services, especially credit, as identified through independent research.

Read the full report here.