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Green should be the color of banking

By Andrew Moody (China Daily) Updated: 2014-11-17 10:46

Zadek says that although the concept of green investment (such as funds that only invest in environmentally friendly companies) has been around for at least 30 years and the big multinationals carry corporate social responsibility audits in their annual financial reports, there remains little joined-up thinking on green issues.

"They almost happen in two completely different parts of the brain. People talk about financial market reform completely absent of any discussion about the environment.

"You can read thousands of pages of discussion documents from various institutions about where financial markets could go after the financial crisis without any mention of climate change or rising inequality within nations. Yet these same institutions will have discussions about climate change and environmental degradation completely separately."

Zadek says this would not be so bad if financial systems were not actually creating more damage to the environment and not less.

"The carbon intensity of the world's major stock exchanges - London and New York - far from reducing over the past five to 10 years, continues to increase. This tells us that investors are still continuing to bet on a carbon-intensive economy and are not shifting their capital toward clean technology."

Zadek, who is originally from London but now lives in Amsterdam, began his career as an economic planner for the St Lucia government in the Caribbean.

He became involved with environmental issues in the 1990s when he worked for the New Economics Foundation, a UK think tank that was concerned with the effects on human well being of economic decisions. It used to hold its own annual summit parallel to the then G7 nations.

"My work there involved building a huge program of work focused on corporate accountability and, in particular, social and environmental accountability."

Over the past five years he has held a number of positions focusing on how the financial sector could play a role in sustainable development.

"I reached the view that the last real frontier to bringing sustainability into economic decision making was the financial sector itself," he says.

His work has brought him to China, where the environmental damage caused by economic development is often far too evident.

Zadek believes the high levels of air pollution in Beijing at the beginning of last year marked a major turning point in the Chinese government's own thinking.

"I think it was a moment where the currency of the environment became significant in the political and economic process in a way it had never been before," he says.

Green should be the color of banking

Green should be the color of banking

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