In 1992, the Bank became the first in the UK to have a customer-led ethical policy, which has since been shaped by more than 320,000 customers.
In 2013 the ethical policy was embedded into the Bank’s constitution and a year later the board appointed Laura Carstensen as independent chair of its new values and ethics committee.
The committee met six times during 2015 and the ethical policy was amended following a consultation with 74,000 customers, colleagues and stakeholders. Around 84% of those surveyed said the Bank’s ethical policy was the main reason for banking there.
That year, the Bank had a total community investment of £1.4m. It also committed £92m to business and commercial lending, up from £58m in 2014.
The Bank is now a living wage employer and last year its staff volunteered 4,352 hours in their local communities.
In October, the Bank announced the Hive, a three-year £1m partnership with Co-operatives UK to support the development and growth of the co-operative and social enterprise sector.
The Bank – which still has the Co-op Group as its largest single shareholder with a 20% stake in the business – expects that nearly 7,000 businesses will be able to access funding for online business advice and guidance, one-to-one support, peer mentoring and group training sessions.
According to the report, the Bank has declined £1bn worth of banking services to businesses that did not meet its ethical banking criteria.
In 2015, the Co-operative Bank added new categories of lending restrictions. Exclusions include finance for the extraction and production of fossil fuels, the manufacture or transfer of arms to oppressive regimes, and animal testing for cosmetic and household purposes.
There are three new areas included in the restriction of banking services – to businesses involved in irresponsible gambling and payday lending, and those that do not take a responsible approach to the payment of tax in the UK or elsewhere.
The Bank has reviewed 304 potential new customers, two of which were declined for failure to comply with its ethical policy.
The report highlights that the Bank’s core business focus is on retail consumers, small and medium sized businesses (SMEs), credit unions, social enterprises, charities and co-ops. In 2015 the Co-operative Bank provided banking facilities for 293 credit union members, or around 55% of the UK credit union sector.
Customers supported nine good causes in 2015 through the Bank’s charity credit cards, raising a total of £961,000 for WaterAid, RSPB, Greenpeace, Save the Children, Oxfam, Woodland Trust, Amnesty International, Christian Aid and Tear Fund.
In terms of the environment, the Bank sourced 99% of its energy from renewable sources. It has also reused or recycled 88% of waste it produced during 2015 (up from 70% in 2014).
The year also marked the launch of new products. After research into how customers use overdrafts, the Bank is offering new overdraft and credit card propositions to ensure customers pay less in fees. According to the report, customer satisfaction has increased from 71% in 2014 to 79% in 2015.
We remain the only high street bank in the UK to have a customer-led ethical policy
The Bank also partnered with Refuge, a national domestic violence charity, to better understand the extent of financial abuse and raise awareness of the issue. The research commissioned by the bank showed that one in five adults have been victims of financial abuse.
Laura Carstensen said: “We remain the only high street bank in the UK to have a customer-led ethical policy and we have long been at the forefront of reporting to our customers and wider stakeholders on its implementation. I’m very pleased that this year’s report builds on this heritage and also documents our return to campaigning.
“The values and ethics which underpin the Bank’s business are now being embedded in all areas including the co-creation of products utilising customer feedback.
“This was central to the creation of our revised overdraft structure and the launch of our balance transfer credit card, which doesn’t penalise customers for small mistakes. The report demonstrates that putting the customer at the heart of everything we do is vital as we continue to rebuild the business and trust in our brand.
“While there is still much to do to turn the business around, we are making real progress. As the most improved brand in the YouGov 2015 Brand Index, our values and ethics continue to differentiate us and I know customers will welcome this report on our progress.”
In this article
- Christian Aid
- Cooperative banking
- Ethical banking
- Ethics Committee
- Laura Carstensen
- Save the Children
- street bank
- Tear Fund
- The Co-operative Bank
- The Co-operative brand
- The Co-operative Group
- United Kingdom
- Values and Ethics Committee
- wage employer
- United Kingdom
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