The pandemic poses a bright new chance to reshape financial services
Airports all over the world are empty. Reduction in air pollution have made the Himalayan mountain tops visible from cities in India. In short, the covid-19 pandemic has helped us visualize how a sustainable and ecologically balanced world would look like. Question is, how do we make these examples a permanent reality? And what role do banks play in making it all happen?
In addition to launching a new whitepaper looking more closely at the role the financial sector is playing, I’ve rounded up some inspiring signs of a growing trend I’ve seen in my own time as a tech and business enthusiast working with banks in our corner of the world.
As early as 2007 the Swedish bank SEB started its first green bonds project with The World Bank. The goal was to make sustainable investment accessible to the mainstream investors. And a lot has happened both in SEB and finance in general since then. Total Green Bond markets have just passed USD 1Trln since inception and there is an expectation of next year's issuance moving towards USD 500bn. SEB themselves see the growing demand for transparent green investment as a great opportunity going into 2021.
In our whitepaper you’ll be able to find other great examples on how the investment community sees changing business models as a benefit for the climate and particularly green bonds as an important tool for turning that benefit into reality.
Earlier this year, TietoEVRY and Länsförsäkringar Bank proudly launched the world’s first renewable payment cards. The cards are made of recycled plastic and save up to 75% of the emissions they otherwise would have created. This is a notable contribution both in the practical sense and in how it shows us where the mindset of the financial sector is moving in terms of recycling and resource optimization.
We already know that recycling is a big topic in the European Union and by 2021 new regulations will be put in place to ensure a longer lifetime of appliances like TVs, freezers, washing machines and fridges. Although there isn’t a push towards recycled payment cards (yet), there is no reason why banks should rest. Actually, being proactive and making changes before regulators put them into law shows a great attitude and will to do something about emissions. And in that way Länsförsäkringar is leading the change.
With the digital economy, new business models emerge with a stronger focus on resource optimalization. Banks and financial institutions play a key role in bringing these to fruition. I myself have been in meetings with banks in Sweden who are eager to explore the new possibilities the shared economy has for our climate. And it’s not just empty words. Earlier this year SEB and Husqvarna launched a joint project looking into how finance and industry intertwine when faced by the sharing economy. In the whitepaper you will find plenty of examples of how specific banks approach new ways of entering partnerships and co-creating funding models that benefit the environment.
If there is one thing that the pandemic has taught us is that very much of the traveling we used to do for meetings is absolutely redundant. Working in a multinational company like TietoEVRY, or a bank with presence in several countries we were used to travel by plane for the luxury of face-to-face meetings. However, with our attitudes to digital meetings being changed by lockdowns and travel restrictions, it’s safe to assume this won’t be the norm going into 2021. Neither for the climate, nor for the efficiency and cost savings in our organizations.
Although meeting face to face is important, I believe the balance will shift. Companies are also adopting new trust-based policies when it comes to working from home, like the Norwegian mobile operator Telenor announcing a “work from anywhere as the standard approach” earlier this year. This will probably make the need for office space shrink, but the climate reward is without a doubt present.
Considering 1.5 million people work in the banking sector in the US alone, reducing weekly travel to an office and the energy consumption of the office space implies great cuts to greenhouse gases. My experience from working with banks in Sweden is that they not only wish to turn investments towards sustainability. They’re also turning their own workspaces and “ways of working” in the very same direction!
The year 2020 has thrown the world economy into a crisis, but out of that crisis there’s opportunity for great change. If anything, we know that the world economy and the world ecology are closely linked.
Together, the great changes present a multi-trillion-dollar global opportunity for the financial industry if the right tools are developed and offered to customers. In other words, technology is finally making green investments profitable as well as possible. There’s a growing wish to mold a new kind of economy and the start of 2021 would be the perfect time to act!
Jennifer has extensive experience in the Financial Services market from the business side in banking, life insurance and fund companies. The last 9 years she has been serving the Financial sector from the IT/Telecom area, helping our customers in speeding up digital transformation. Her passion is automation and innovation for a fruitful business, creating a better experience for employees and customers alike.