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Co-op Bank says ethics are in its constitution – but should we believe it?



We will “[continue] to have regard for the highest standards of ethical principles”, the Co-operative Bank stated in an advert on Monday. This is despite being 70% owned by outside investors, two of which – Silver Point Capital and Aurelius* – led the charge for external ownership.

Appearing in national titles such as the Guardian, the Financial Times, the Daily Telegraph and the Sun, along with a number of trade publications, the advert says the Co-op’s ethics have “stayed the same” during its recent rocky period.

Whether that’s the commitments we’ve made to our customers’ values over the years to do things differently, or our refusal to bank with businesses we don’t believe meet our values. We now believe that we must go even further than before to ensure that those beliefs are set in stone, both for our customers, and for us”, it adds.

Its flagship ethical code, which in the past led to it being lauded as the high street’s leading ethical player, has apparently been written into the Co-op’s legally-binding constitution. Meanwhile, a new independent values and ethics committee is to be set up to help protect this culture. The BBC’s business editor Robert Peston added, “Co-op Group will have the right to strip the bank of the ‘Co-op’ moniker if it starts lending money to clubbers of seal pups or in any other way doesn’t behave as its customers would want.”

Click here to read The Guide to Sustainable Banking 2013

The Co-op advert, signed by group CEO Euan Sutherland and bank CEO Niall Booker, concludes, “Over the years, our ethical policy has made the Co-operative Bank special for millions of people. By continuing to have regard for the highest standards of ethical principles we are more committed than ever to ensuring that the Co-operative Bank remains just as special for years to come.”

While it may be encouraging for Co-op customers to see such steadfastness over the ethical policies that attracted many of them to open accounts in the first place, the advert comes alongside news that at least 15% of the bank’s branches will close as part of its £1.5 billion recapitalisation plan. You don’t have to have the keenest sense of smell in the world to get the scent of marketing spin.

Indeed, Andre Spicer, professor of organisational behaviour at Cass Business School, said, “Cutting 1,000 jobs at the same time as you launch an ethics policy is quite a contradiction. It is likely to alienate many of the bank’s customers. The result could be customers leaving.

Fortunately for the Co-op Bank, most bank customers are lazy – only changing banks every couple of decades. Maintaining the bank’s ethical culture in the face of job cuts and public vilification is going to be hard. It is likely many staff will feel disheartened and ask themselves if this is what they signed up for.”

Despite this, the Co-op’s pledge has been largely welcomed – even if its initial decision to allow hedge funds to invest was met with derision. Laura Willoughby, chief executive of Move Your Money, described its ethical commitment as “great news for customers and excellent news for the banking sector”.

She added, “We know that customers want a bank that is better and if Co-op keeps its pledge, it still makes it an ethical alternative to the big four banks who still don’t care at all.”

Meanwhile Ed Mayo, secretary-general of trade body Co-operatives UK, said, “We have seen the announcement of the recapitalisation plan for the Co-operative Bank and will conduct a full technical analysis of the constitution once it has been released. We are of course welcoming of the bank’s continued commitment to adopt an ethical stance.”

Some are slightly more sceptical, though. Shaun Fensom from the Save Our Bank campaign said, “Today’s announcement from the Co-operative Bank contains some welcome pledges. However, we are missing the cast-iron commitment that the bank’s ethical policy will be set in stone, not some ambiguous ethical code. We need an independent audit and warts and all reporting.”

Fensom outlined that the Save Our Bank campaign, which was set up in October to seek to preserve the Co-op’s ethical principles, wanted “both real guarantees on ethics and a plan to return to mutual ownership.”

Save Our Bank, alongside a range of other charities and NGOs that banked with the Co-op, recently wrote to the bank to urge it to maintain its ethics.

John Sauven, executive director of Greenpeace UK, said, “A major reason Greenpeace banked with the Co-operative Bank is that it was one of the few to have grasped the need for our society to wean itself off fossil fuels. It’s important to Greenpeace and our supporters that such farsighted commitments continue.”

For some individuals, the Co-op’s recent turmoil has led them to consider more ethical and responsible alternatives. Their exits were aided with the introduction of the new seven-day switching scheme in September.

One former customer, Jo Owen, wrote about her reasons for ditching the Co-op in favour of Nationwide on Blue & Green Tomorrow in August. Speaking about Monday’s announcement, she said, “I’m pleased to see that their commitment to ethical banking has been enshrined in their articles of association.

However, the fact remains that a large portion of the bank is now in the hands of a hedge fund, and today’s announcement on branch closures does not reassure me. I wonder whether the Co-operative Bank has any future at all, and all the ethical commitments in the world may not be enough to save it.”

Meanwhile, a current Co-op customer, Paul Gibson, summed the bank’s sorry state up on Twitter, saying it was “surreal when [a bank] has to confirm that it’s ethical in adverts”.

While it is clearly encouraging to hear the Co-op’s reassurances over its ethical policies, only time will tell whether it is seriously committed. Having ethics as a bank does not just mean lending and investing responsibly, though. It means valuing your customers and caring for local communities.

As a Co-op customer myself, I have received nothing but bank statements, product flyers and account change notifications through the post since April, when this whole charade came to light. As well as (or instead of) adverts in all the national papers, perhaps personalised letters to its customers – many of whom have accounts with the bank because of what it stands, or stood, for rather than its interest rates – would have been more appropriate (though admittedly more expensive).

If the Co-op fails to stand by Monday’s firm pledges, retribution will be swift as socially-orientated consumers and businesses decide enough is enough, and begin to look elsewhere.

* Silverpoint Capital is a Connecticut-based hedge fund that holds or has held stakes in casino brand Herbst Gaming and doughnut maker Krispy Kreme. New York-based hedge fund Aurelius Capital Management is involved in the current attempt to force the Argentinian government to pay $1.3 billion following the country’s 2010 debt default.

Further reading:

Co-op Bank to close 15% of branches, as hedge funds take control

We will stand by our ethical principles, Co-op Bank boss assures charity customers

Ethics, mutuals and the Co-operative Bank’s unclear future

Co-op Bank can no longer be ethical, says ex-CEO

The Guide to Sustainable Banking 2013


New Zealand to Switch to Fully Renewable Energy by 2035



renewable energy policy
Shutterstock Licensed Photo - By Eviart /

New Zealand’s prime minister-elect Jacinda Ardern is already taking steps towards reducing the country’s carbon footprint. She signed a coalition deal with NZ First in October, aiming to generate 100% of the country’s energy from renewable sources by 2035.

New Zealand is already one of the greenest countries in the world, sourcing over 80% of its energy for its 4.7 million people from renewable resources like hydroelectric, geothermal and wind. The majority of its electricity comes from hydro-power, which generated 60% of the country’s energy in 2016. Last winter, renewable generation peaked at 93%.

Now, Ardern is taking on the challenge of eliminating New Zealand’s remaining use of fossil fuels. One of the biggest obstacles will be filling in the gap left by hydropower sources during dry conditions. When lake levels drop, the country relies on gas and coal to provide energy. Eliminating fossil fuels will require finding an alternative source to avoid spikes in energy costs during droughts.

Business NZ’s executive director John Carnegie told Bloomberg he believes Ardern needs to balance her goals with affordability, stating, “It’s completely appropriate to have a focus on reducing carbon emissions, but there needs to be an open and transparent public conversation about the policies and how they are delivered.”

The coalition deal outlined a few steps towards achieving this, including investing more in solar, which currently only provides 0.1% of the country’s energy. Ardern’s plans also include switching the electricity grid to renewable energy, investing more funds into rail transport, and switching all government vehicles to green fuel within a decade.

Zero net emissions by 2050

Beyond powering the country’s electricity grid with 100% green energy, Ardern also wants to reach zero net emissions by 2050. This ambitious goal is very much in line with her focus on climate change throughout the course of her campaign. Environmental issues were one of her top priorities from the start, which increased her appeal with young voters and helped her become one of the youngest world leaders at only 37.

Reaching zero net emissions would require overcoming challenging issues like eliminating fossil fuels in vehicles. Ardern hasn’t outlined a plan for reaching this goal, but has suggested creating an independent commission to aid in the transition to a lower carbon economy.

She also set a goal of doubling the number of trees the country plants per year to 100 million, a goal she says is “absolutely achievable” using land that is marginal for farming animals.

Greenpeace New Zealand climate and energy campaigner Amanda Larsson believes that phasing out fossil fuels should be a priority for the new prime minister. She says that in order to reach zero net emissions, Ardern “must prioritize closing down coal, putting a moratorium on new fossil fuel plants, building more wind infrastructure, and opening the playing field for household and community solar.”

A worldwide shift to renewable energy

Addressing climate change is becoming more of a priority around the world and many governments are assessing how they can reduce their reliance on fossil fuels and switch to environmentally-friendly energy sources. Sustainable energy is becoming an increasingly profitable industry, giving companies more of an incentive to invest.

Ardern isn’t alone in her climate concerns, as other prominent world leaders like Justin Trudeau and Emmanuel Macron have made renewable energy a focus of their campaigns. She isn’t the first to set ambitious goals, either. Sweden and Norway share New Zealand’s goal of net zero emissions by 2045 and 2030, respectively.

Scotland already sources more than half of its electricity from renewable sources and aims to fully transition by 2020, while France announced plans in September to stop fossil fuel production by 2040. This would make it the first country to do so, and the first to end the sale of gasoline and diesel vehicles.

Many parts of the world still rely heavily on coal, but if these countries are successful in phasing out fossil fuels and transitioning to renewable resources, it could serve as a turning point. As other world leaders see that switching to sustainable energy is possible – and profitable – it could be the start of a worldwide shift towards environmentally-friendly energy.


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How Going Green Can Save A Company Money



going green can save company money
Shutterstock Licensed Photot - By GOLFX

What is going green?

Going green means to live life in a way that is environmentally friendly for an entire population. It is the conservation of energy, water, and air. Going green means using products and resources that will not contaminate or pollute the air. It means being educated and well informed about the surroundings, and how to best protect them. It means recycling products that may not be biodegradable. Companies, as well as people, that adhere to going green can help to ensure a safer life for humanity.

The first step in going green

There are actually no step by step instructions for going green. The only requirement needed is making the decision to become environmentally conscious. It takes a caring attitude, and a willingness to make the change. It has been found that companies have improved their profit margins by going green. They have saved money on many of the frivolous things they they thought were a necessity. Besides saving money, companies are operating more efficiently than before going green. Companies have become aware of their ecological responsibility by pursuing the knowledge needed to make decisions that would change lifestyles and help sustain the earth’s natural resources for present and future generations.

Making needed changes within the company

After making the decision to go green, there are several things that can be changed in the workplace. A good place to start would be conserving energy used by electrical appliances. First, turning off the computer will save over the long run. Just letting it sleep still uses energy overnight. Turn off all other appliances like coffee maker, or anything that plugs in. Pull the socket from the outlet to stop unnecessary energy loss. Appliances continue to use electricity although they are switched off, and not unplugged. Get in the habit of turning off the lights whenever you leave a room. Change to fluorescent light bulbs, and lighting throughout the building. Have any leaks sealed on the premises to avoid the escape of heat or air.

Reducing the common paper waste

paper waste

Shutterstock Licensed Photo – By Yury Zap

Modern technologies and state of the art equipment, and tools have almost eliminated the use of paper in the office. Instead of sending out newsletters, brochures, written memos and reminders, you can now do all of these and more by technology while saving on the use of paper. Send out digital documents and emails to communicate with staff and other employees. By using this virtual bookkeeping technique, you will save a bundle on paper. When it is necessary to use paper for printing purposes or other services, choose the already recycled paper. It is smartly labeled and easy to find in any office supply store. It is called the Post Consumer Waste paper, or PCW paper. This will show that your company is dedicated to the preservation of natural resources. By using PCW paper, everyone helps to save the trees which provides and emits many important nutrients into the atmosphere.

Make money by spreading the word

Companies realize that consumers like to buy, or invest in whatever the latest trend may be. They also cater to companies that are doing great things for the quality of life of all people. People want to know that the companies that they cater to are doing their part for the environment and ecology. By going green, you can tell consumers of your experiences with helping them and communities be eco-friendly. This is a sound public relations technique to bring revenue to your brand. Boost the impact that your company makes on the environment. Go green, save and make money while essentially preserving what is normally taken for granted. The benefits of having a green company are enormous for consumers as well as the companies that engage in the process.

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