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Triodos Bank AGM: profits or philanthropy is a false choice

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More than 500 investors and savers gathered at the Old Passenger Shed in Bristol earlier this month for Triodos Bank’s annual general meeting (AGM). It was an event that very much broke free from the norm.

Mention ‘banking’ to the layperson and the chances are they’ll mention the scandals: the excessive bonuses, the mis-selling of financial products and the irresponsible investment strategies. The industry’s wrongdoings are often common knowledge.

There is often a palpable sense of greed, unethical decisions and a one-track mind desperately snatching at a quick fix of financial empowerment, accompanied by a blatant ignorance of the impact that investment decisions are having on the real economy, outside of the banking bubble.

I would encourage people of this mindset to look at the alternative options, for they are worlds away from the mainstream.

Triodos Bank’s AGM, held in Bristol on a beautiful Saturday morning in September, saw more than 500 customers congregate to find out how their money was being used; namely for environmental and social good. Sitting in a magnificent building at the heart of Britain’s green capital, I couldn’t help but sense a ray of hope.

Banking doesn’t have to be evil, and there are genuine bankers who care about the societies that they serve.

Charles Middleton, the managing director of Triodos UK, kicked off proceedings by welcoming his fellow “changemakers”; after all, it was their money that was being used to make bring about change within society.

Every person in the room, Middleton said, were united by a single common goal; one that aims to bring about cultural and social changes to the world in which we live.

But is it possible to make profits whilst attending to the needs of society, the planet and its people? The figures suggest so. In 2012, Triodos Group as a whole made international profits of £25.1m, and in the first half of 2013, this figure stands at £15.6m.

Although this might be a drop in the ocean next to some of the mainstream banks, you only have to take one look at the plight of the Co-operative Bank, which recently announced pre-tax losses of £709m, to see that Triodos is putting bread on the table for its customers.

Triodos also has an impressive investment portfolio to match, ranging from Cafe Ode, the UK’s most sustainable restaurant, to Jamie’s Farm, an initiative that aims to get young people on the brink of crime back on track by transforming their lives.

Another of the success stories was a social enterprise backed by Triodos, Bristol Together, which works on rehabilitating ex-prisoners. Among its last round of participants, only one of 40 returned to prison – enough to make G4S and Serco quiver in their boots.

Among the other Triodos speakers were Dan Hird, head of corporate finance, and James Vaccarro, head of marketing and corporate development. Each told how the Triodos visions were brought to life through the projects they fund.

But what struck me more than anything was the mutual respect between the bankers and the customers. All 500 attendees sat in awe of the great things that were happening with their savings. But, if customers can grow their savings with high street banks, why would they bother having to inconvenience themselves by switching?

I was horrified and mortified by what was happening with my money when I used mainstream banks“, said Liz Caulder, a 32-year-old psychology student who has banked with Triodos for three years.

I don’t like the thought of my money funding arms companies and tobacco firms. It shouldn’t be just about money.”

She added, “I feel its important that financial organisations have a beneficial impact on society rather than a detrimental one.”

Every customer I spoke to described the “good feeling of contributing towards something positive“. Sound egotistical? You might call it vanity giving; philanthropy for praise; patting yourself on the back.

Whatever you want to call it, the world would be a worse place without it. If you can have a slice of both cakes, getting good returns on your money and helping to shape a more positive future sounds like a very attractive combination.

The fact is that banking does not need to be disconnected from society – this was a discourse held within every speech – and it is not one that is exclusive to the financial industry. Simon Roberts, head of the Centre for Sustainable Energy, said that the industry had “lost touch with the communities it is serving” but insisted that, as savers, we have the power to change that.

Politicians don’t create change. They listen to the voices, see the action and climb on the wave and ride it“, said Roberts.

By insisting on change, savers can create the political landscape that will see a transition from the disjointed financial system that led to the financial crisis, to one where money breeds positivity, and not greed.

But of course, the greed that was once standard practice within mainstream banking still exists today. Catherine Howarth, CEO of ShareAction, which promotes responsible investment, spoke of the public discontent with the financial sector, or, as she put it, the “banker-beating” which so many people enjoy these days.

She stressed that the behaviour displayed by bankers – excessive bonuses, Libor fixing, the PPI scandal – leads to widespread mistrust of the industry. Bankers faced intense scrutiny by the public, government and the media, but she argued that similar behaviours are apparent in the pension industry. The difference is, she said, the public has not yet learned of the full extent of its irresponsible behaviour.

Slowly but surely, the banking industry is being transformed by Triodos and the realm of other alternative options. Transparency lies at the heart of Triodos’ mission, and it is a key tool which it intends to use on its quest to bring about positive change to society.

You can make profits with a philanthropic goal in mind; Triodos has shown this. Gone are the days where we are faced with a choice between the two. As Dan Hird said, “You can have it all.”

Triodos currently only offers accounts for savers. As such, the majority of customers I spoke to said that their current accounts were with banks such as RBS, Lloyds and Santander. The room therefore broke into applause when it was announced that Triodos is hoping to offer current accounts to customers by 2015; their money will go that little bit further in helping to create a better world to live in.

But will this form of values-based banking ever become mainstream? Can it become the norm?

The most vital link in the banking chain is you – the customer. Without access to finance, the powerful become powerless. Banks do not have a god-given right to do what they want. In order for them to operate, they must have customers. They must have people.

“Why shouldn’t values-based banking become mainstream?” is the wrong question. The real question for all of us should be, “What are you going to do to help values-based banking become mainstream?”

Well?

Further reading:

Number of financial complaints rose by 179% in last three months

Triodos unveils £3m social investment bond to help ex-offenders in Midlands

Small is beautiful: why alternative banks need to step up to the mark

Swimming against the tide: ethical banks as countermovement

The Guide to Sustainable Banking 2012

Economy

Will Self-Driving Cars Be Better for the Environment?

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self-driving cars for green environment
Shutterstock Licensed Photo - By Zapp2Photo | https://www.shutterstock.com/g/zapp2photo

Technologists, engineers, lawmakers, and the general public have been excitedly debating about the merits of self-driving cars for the past several years, as companies like Waymo and Uber race to get the first fully autonomous vehicles on the market. Largely, the concerns have been about safety and ethics; is a self-driving car really capable of eliminating the human errors responsible for the majority of vehicular accidents? And if so, who’s responsible for programming life-or-death decisions, and who’s held liable in the event of an accident?

But while these questions continue being debated, protecting people on an individual level, it’s worth posing a different question: how will self-driving cars impact the environment?

The Big Picture

The Department of Energy attempted to answer this question in clear terms, using scientific research and existing data sets to project the short-term and long-term environmental impact that self-driving vehicles could have. Its findings? The emergence of self-driving vehicles could essentially go either way; it could reduce energy consumption in transportation by as much as 90 percent, or increase it by more than 200 percent.

That’s a margin of error so wide it might as well be a total guess, but there are too many unknown variables to form a solid conclusion. There are many ways autonomous vehicles could influence our energy consumption and environmental impact, and they could go well or poorly, depending on how they’re adopted.

Driver Reduction?

One of the big selling points of autonomous vehicles is their capacity to reduce the total number of vehicles—and human drivers—on the road. If you’re able to carpool to work in a self-driving vehicle, or rely on autonomous public transportation, you’ll spend far less time, money, and energy on your own car. The convenience and efficiency of autonomous vehicles would therefore reduce the total miles driven, and significantly reduce carbon emissions.

There’s a flip side to this argument, however. If autonomous vehicles are far more convenient and less expensive than previous means of travel, it could be an incentive for people to travel more frequently, or drive to more destinations they’d otherwise avoid. In this case, the total miles driven could actually increase with the rise of self-driving cars.

As an added consideration, the increase or decrease in drivers on the road could result in more or fewer vehicle collisions, respectively—especially in the early days of autonomous vehicle adoption, when so many human drivers are still on the road. Car accident injury cases, therefore, would become far more complicated, and the roads could be temporarily less safe.

Deadheading

Deadheading is a term used in trucking and ridesharing to refer to miles driven with an empty load. Assume for a moment that there’s a fleet of self-driving vehicles available to pick people up and carry them to their destinations. It’s a convenient service, but by necessity, these vehicles will spend at least some of their time driving without passengers, whether it’s spent waiting to pick someone up or en route to their location. The increase in miles from deadheading could nullify the potential benefits of people driving fewer total miles, or add to the damage done by their increased mileage.

Make and Model of Car

Much will also depend on the types of cars equipped to be self-driving. For example, Waymo recently launched a wave of self-driving hybrid minivans, capable of getting far better mileage than a gas-only vehicle. If the majority of self-driving cars are electric or hybrids, the environmental impact will be much lower than if they’re converted from existing vehicles. Good emissions ratings are also important here.

On the other hand, the increased demand for autonomous vehicles could put more pressure on factory production, and make older cars obsolete. In that case, the gas mileage savings could be counteracted by the increased environmental impact of factory production.

The Bottom Line

Right now, there are too many unanswered questions to make a confident determination whether self-driving vehicles will help or harm the environment. Will we start driving more, or less? How will they handle dead time? What kind of models are going to be on the road?

Engineers and the general public are in complete control of how this develops in the near future. Hopefully, we’ll be able to see all the safety benefits of having autonomous vehicles on the road, but without any of the extra environmental impact to deal with.

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Economy

New Zealand to Switch to Fully Renewable Energy by 2035

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renewable energy policy
Shutterstock Licensed Photo - By Eviart / https://www.shutterstock.com/g/adrian825

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.

Sources: https://www.bloomberg.com/news/articles/2017-11-06/green-dream-risks-energy-security-as-kiwis-aim-for-zero-carbon

https://www.reuters.com/article/us-france-hydrocarbons/france-plans-to-end-oil-and-gas-production-by-2040-idUSKCN1BH1AQ

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