BankTrack as a Resource for Understanding CSR in Banking
Some of you may have seen todayâs New York Times story about the important CSR subject of environmental risk in banking. Â The article argued that banks like Wells Fargo, JP Morgan, Goldman Sachs, and Citigroup have become increasingly reluctant to lend to companies engaged in risky activities like mountaintop removal in coal-mining. Â Perhaps watchdog groups like Rainforest Action Network have done a pretty good job at making enough of a stink that banks are changing their ways. Â Or perhaps banks can no longer afford involvement in companies like Massey Energy, which have incurred significant expenses due to irresponsible practices.
I would encourage anybody interested in getting a sense of what banks do and donât finance to visit BankTrack, âa global network of civil society organisations and individuals tracking the operations of the private financial sector.â Â The database balances information about involvement with major CSR initiatives like the Global Reporting Initiative (GRI), Carbon Principles, Equator Principles, Carbon Disclosure Project (CDP), UN Global Compact, and Wolfsberg Principles with detail about âdodgy dealsâ involving financing of socially and environmentally problematic activities relating to cluster munitions, mining, nuclear, and the Tar Sands. Â The website also features information about companies that ârequire attentionâ from each bank. Â For example, HSBC may have one of the better track records when it comes to voluntary standards and commitments, but is no different from the other companies in the database in its involvement with controversial mining, forestry, dam, and oil and gas projects and its engagement with companies like Walmart, Textron, Vedanta, andÂ Freeport McMoRan.
Although BankTrack has its drawbacks (for example, it is difficult to quickly determine the status of deals cited from a number of years back), it provides an exceptional free entry point for people interested in familiarizing themselves with what CSR means (or doesnât mean) for some of the worldâs largest banks. Â Most importantly, it does so in a way that keeps the focus on the activities most material to banks, refusing to dilute the data it offers with information about the type of CSR initiatives which seem to have garnered criticism from people like Aneel Karnani.
So does BankTrack provide insight into how banks are handling the types of CSR issues discussed in todayâs New York Times article? Â My only gripe is that it is sometimes difficult to gauge how a bankâs involvement with a specific corporate social responsibility issue has evolved over time. Â Nevertheless, as far as free databases go, it is a remarkable starting point for anybody seeking to figure out want questions to ask about CSR at major banks.
Photo credit: prayitno