Banks. We all love banks, don’t we? They’re an essential part of modern living for most of us. They keep our money nice and safe for us (probably), make it (mostly) easy for us to access it, and generally give us a more favourable interest rate than we’d get stashing our notes under the mattress. Plus they’re less prone to burglars – although they do on occasion suffer from bankers.
Generally speaking, once a bank has got hold of our money, they don’t just stick it under their own mattresses until we ask for it back. They tend to do things with it, like investing it to make more, and that mostly means we have to trust that while they’ve got it, they’re not going to use it to fund anything too warlike, drug-cartelish or environmentally damaging.
Until quite recently, banks have always tended to do their own thing with the money they control, and most people (myself included) have tended to let them get on with it without looking too closely. But in recent years, the global financial crisis has led to the increased scrutiny of banks by governments, regulators and customers alike, and this has has started to expose some of the… I’m feeling charitable, so let’s call them “issues”. Banks are being nudged towards improving their ethical policies. But, as tempting as it is to simply follow the media-presented line that Banks Are Evil, actually identifying bad practices and ensuring ethic… eth… ethicability? (Is that a word?) … isn’t as easy as we might suppose. Sure, whether or not you’re laundering money or lending funds to drugs gangs should be a pretty clear-cut issue; and if you are, don’t. Easy. But ‘unethical’ doesn’t necessarily equate to ‘illegal’, so treading the line can get complex.
For example, by far the greater part of the global arms trade is composed of entirely legitimate businesses. Strictly speaking, no-one involved in those companies is doing anything illegal. Nor are those businesses concerned with mineral prospecting, oil or nuclear power. Yet these are all industries which, to some extent, many people prefer not to support, and wouldn’t want to think of their savings as funding those activities, legal though they may be.
In addition to these concerns, many people find themselves facing a religious dilemma when it comes to banking. Some religions – notably Judaism and Islam – have strict rules regarding loans, investments and interest. Islam in particular forbids earning “money from money”. In other words, a Muslim isn’t supposed to gain interest just by having money in an account: it’s money s/he hasn’t earned. An entire sector of sharia-compliant banks exists to cater to this restriction, and many non-Muslims have also found these an appealing alternative to the more conventional high-street banks.
There are an increasing number of banks offering more robust ethical policies, ensuring that they are not supporting morally questionable practices. Most of the high street banks now sport rather more sparkly environmental policies, although we suppose this doesn’t necessarily indicate that they’re being lived up to: many policies throughout the commercial sector include the words “working towards”, which doesn’t provide any quantifiable information.
If you’re concerned about these issues and are thinking about moving your money as a result, well, we’re not financial advisors, so we’re not going to tell you what to do. You can get into a world of trouble that way. But, Good News, Everyone! There is a website which is not nearly so reticent, called Ethical Consumer, and they’re happy to offer suggestions. Apart from referring to us as ‘consumers’ (cows are consumers), it does offer a handy tool in the shape of a dynamically updated list of banks it recommends based on your ethical concerns.
Visit the site HERE and use the sliders to set your level of concern over specific issues, and watch the list of accounts to see who comes out on top. Hint: it’s the Coventry Building Society, who seem to score highly on everything. But check the list anyway – it’s genius.
Right, I’m off to see the bank. No, I really am: it’s the strangest coincidence.
Your gingerbread house may be repossessed if you do not keep up repayments to the sweetie shop for all the sugary goodness they provided you on account. Next time use bricks like any normal person, sheesh.
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