The meaning and importance of ethical banking for companies under ESG scrutiny
Ethical banking: what is it, and why is it mentioned more and more often? Ethical banking is an approach in which banks pursue practices or initiatives that reflect their social responsibility (CSR) into account, both through investment and lending policies, as well as the possible social and environmental impacts. The meaning of the term, although quite broad, describes those financial institutions that operate according to principles and ideals used to govern the way they interact in particular with their stakeholders, customers, communities served, companies, and the rest of the world.
The European strategy linked to ethical banking and sustainable finance plays a fundamental role in the mobilization of private resources to support the Next Generation EU plan which is entrusted with the task of relaunching the European economy after the serious economic crisis deriving from the pandemic.
This article by ESG360, tells one everything you need to know about ethical banking, covering the general meaning of the term, the differences between ethical and traditional banks, as well as the link between ESG and ethical banking.