Sustainable development and CSR practices by Greece’s banks

Alpha Bank has become the fifth Greek bank to enter the United Nations Environmental Program-Financial Initiative (UNEP-FI), the international project for sustainable development and corporate social responsibility (CSR). Alpha has followed Emporiki Bank, EFG Eurobank, Bank of Cyprus and Interamerican. «We are very happy about this and we are expecting to welcome Piraeus Bank, too, in the UNEP-FI family,» said Paul Clements-Hunt, the head of the initiative, during a one-day event it held in Athens, sponsored by Alpha Bank. The importance of this enlargement of Greek participation focuses on the expansion of the initiative to the broader region of Central and Eastern Europe. In 2008 it is expected to expand to all Balkan states. Speaking to Kathimerini, Clements-Hunt suggested the Greek progress is a dynamic momentum, «as the influence of Greek financial institutions both in the Balkans and in the Middle East increases the chances for a positive impact on those regions as well if they adopt policies, practices and products which promote sustainable development,» he said. UNEP-FI was set up in 1992 and today has 160 banks and insurers as members internationally, who have adopted the idea that their «economic development and prosperity must take into account the social and environmental parameters for the avoidance of risks and for the growth of the economy.» Sustainable development is now a condition for the development of trust and good reputation inside and around any corporation. In their internal environment, credit corporations can have immediate results by reducing their use of energy, paper and water. More far-reaching benefits may come from decisions to issue loans and make investments determined by social and environmental criteria: In both cases the financial impact on corporations themselves will be positive. Survey across Greece The first survey in Greece on the extent of the application of practices for the UNEP-FI targets at the banking and insurance sectors was presented at the event, but the results were not very encouraging. Despite the great significance that local banks say they attribute to sustainable development issues, the survey shows that «contrary to international developments, they only focus on internal environmental management, on CSR campaigns and the selected offering of ‘green’ products, not on sustainable lending and investment practices.» Twelve out of the 13 corporations which took part in the survey acknowledged that environmental issues will be a criterion of choice for future customers and investors of a bank. Eleven banks also stated that they should have to give a social account showing the significance every corporation has given to the environment and to sustainable development. Another finding seems very promising, as 10 out of 13 companies said that within five years the corporate social responsibility policies will play an important role in banks’ business, while demand for special banking products such as loans for environmental projects in addition to environmental leasing has reached 80 percent of all products concerning the environment.