Green Banking
Green Banking means promoting environmental-friendly practices and reducing carbon footprint from the banking activities. It is also called ethical or sustainable banking. For banking professionals green banking involves the vision of sustainability, ethical lending, conservation and energy efficiency.
A green bank is controlled by same authorities as what a conventional bank does, but it holds some distinctive characteristics over conventional banking practices. In conventional banking practices, it 's been unclear where the money depositors or investors put into a bank actually goes- doesn’t go for a good cause. But a green bank gives the reassurance of knowing where investor’s money is - and isn 't - going to when they go to deposit their cash. A green bank checks all the factors before lending a loan, whether the project is environment friendly and has any implications in the future; they will award a loan only when the project follows all the environmental and safety standards.
The Banking Regulation and Policy Department (BRPD) of Bangladesh Bank in its “Policy Guidelines for Green Banking” has termed Green Banking as a component of the global initiative by a group of stakeholders to save environment. From this policy guideline it is clear that the Banking Watchdog would like to see that the banks would act under Green Banking guidelines and green banks do not only improve their own standards but also affect socially responsible behavior of other business.
Benefits of Ethical/Green Banking
• Basically Ethical banking avoids as much as paper work, we get ‘go green’ credit cards, ‘go green’ mortgages and also all the transactions done through online.
• Creating awareness to business people about environmental and social responsibility enabling them to do an environmental friendly business practice.
• They follow environmental standards for lending, which is really a good idea and it will make business owners to change their business to
A green bank is controlled by same authorities as what a conventional bank does, but it holds some distinctive characteristics over conventional banking practices. In conventional banking practices, it 's been unclear where the money depositors or investors put into a bank actually goes- doesn’t go for a good cause. But a green bank gives the reassurance of knowing where investor’s money is - and isn 't - going to when they go to deposit their cash. A green bank checks all the factors before lending a loan, whether the project is environment friendly and has any implications in the future; they will award a loan only when the project follows all the environmental and safety standards.
The Banking Regulation and Policy Department (BRPD) of Bangladesh Bank in its “Policy Guidelines for Green Banking” has termed Green Banking as a component of the global initiative by a group of stakeholders to save environment. From this policy guideline it is clear that the Banking Watchdog would like to see that the banks would act under Green Banking guidelines and green banks do not only improve their own standards but also affect socially responsible behavior of other business.
Benefits of Ethical/Green Banking
• Basically Ethical banking avoids as much as paper work, we get ‘go green’ credit cards, ‘go green’ mortgages and also all the transactions done through online.
• Creating awareness to business people about environmental and social responsibility enabling them to do an environmental friendly business practice.
• They follow environmental standards for lending, which is really a good idea and it will make business owners to change their business to
References: ^ Jeucken, M. "Banking and sustainability—slow Starters are Gaining Pace." Ethical Corporation Magazine 11 (2002): 44–48. ^ Jeucken, M. H., and J. J. Bouma. "The Changing Environment of Banks." GREENER MANAGEMENT INTERNATIONAL (1999): 21–35. ^ Bangladesh Bank, “Environmental Risk Management Guidelines for Banks and Financial Institutions in Bangladesh”, Dhaka, January 2011. ^ Bangladesh Bank, The Banking Regulation and Policy Department (BRPD), “Policy Guidelines for Green Banking”, Dhaka, December 2010. ^ Bangladesh Bank, “A comprehensive guideline on Corporate Social Responsibility (CSR)”, Dhaka, 2010.