A STUDY ON

“GREEN BANKING- AN INNOVATION FOR ECO-SUSTAINABILITY FOR

FUTURE”

MASTER OF MANAGEMENT STUDIES (MMS)

UNIVERSITY OF MUMBAI

SUBMITTED TO
Alamuri Ratnamala Institute of Engineering and
Technology
(ARMIET)

UNDER THE GUIDANCE OF

PROF. KRUTIKA SAWANT

SUBMITTED BY
SANKET PRAMOD SONAR
ACADEMIC YEAR
2019– 2020
FINANCE
1
 Alamuri Ratnamala Institute of Engineering and
Technology
(ARMIET)
(Affiliated by University of Mumbai)

MASTER OF MANAGEMENT STUDIES

CERTIFICATE

This is to certify that MR. SANKET PRAMOD SONAR PIN No.ARMIET/MMS/18 SS81
has satisfactorily carried out the project work on the topic “GREEN BANKING- AN

INNOVATION FOR ECO- SUSTAINABILITY FOR FUTURE”, for the S.Y.M.M.S., in the
academic year 2019-2020.

Place:-

Date:-________

_____________ __________________

Project guide Signature of Principal

2
 DECLARATION

I declare that this written submission represents my ideas in my own words and where others
ideas or words have been included. I have adequately cited and referenced the original sources.
I also declare that I have adhered to all principles of academic honesty and integrity and have
not misrepresented or falsified any idea/data/fact/source in my submission. I understand that my
violation of above will be cause for disciplinary action by the Institute and can also evoke penal
action from the sources which have thus not been properly cited or from whom proper

permission has not been taken when needed.

(Signature)

3
 ACKNOWLEDGEMENT

It gives me great pleasure to submit this project to UNIVERSITY OF MUMBAI as a part of

MMS course.

With deepest gratitude, I take this opportunity to acknowledge the co-operation, support and
valuable guidance extended by college faculty.

I take this opportunity with great pleasure to present project on GREEN BANKING-AN
INNOVATION FOR ECO-SUSTAINABILITY FOR FUTURE which is a result of co-operation,
hard work and good wishes of many people

Finally, sincere thanks to Prof. KRUTIKA SAWANT for his encouragement. I would also like
to appreciate contributi on of my family and friends who have extended their  complete
support in completion of this project.

Thank you.
SANKET PRAMOD SONAR
MMS (2020)
Alamuri Ratnamala Institute of Engineering and Technology

INDEX

4
 No. Topic Page No.

1 EXECUTIVE SUMMARY 6

2 INTRODUCTION 6

3 SCOPE OF THE STUDY 9

4 LIMITATIONS OF THE STUDY 10

5 OBJECTIVES 11

6 EVOLUTION OF GREEN BANKING 12

7 DATA ANAYSIS AND INTERPRETATION 31

8 FINDINGS & SUGGESTIONS 40

9 CONCLUSION & RECOMMENDATIONS 41

10 BIBLIOGRAPHY 44

EXECUTIVE SUMMARY

Banking sector though do not play a direct role in the environmental degradation they
too are in way contribute for the environmental problems indirectly. The banking
activities in general are environmental friendly and do not affect the environment due to
their internal operations by causing pollution or by the discarding hazardous waste.
However banks provide loans to the industries and other firms who in turn carryout the
business in such a way that affects the environment. This article
studies the Green banking initiatives taken by the largest public sector bank in India
(State Bank of India) and the awareness and perception of its customers towards such
initiatives. Since SBI is the first public sector bank to introduce Green Banking Products,
it is chosen for this research. This study will help SBI to know about their customers‘

5
perception about the Green banking initiatives taken up by it. The study will also help to
know the satisfaction level of the customers on Green Banking Products introduced by
SBI.

INTRODUCTION

A bank is a financial institution where people secure their money and use this institution
as a source of possible finance. Banking, the form in which it exists, nowadays is
comparatively of recent origin. Before the advent of modern banking, direct finance,
where the owner of capital deals directly with the user of capital, was the customary
mode of transferring of funds from savers to investors. Nowadays, banks are
organizations engaged inany or various functions i.e. receiving, collecting, transferring,
paying, lending, investing, dealing, exchanging,and servicing money and claims to
money both locally and internationally.
India is a country suffering from immense social, political, economic and environmental
issues and these issues need to be addressed for the overall development of this
country. However, we all know that the people of the whole world are concerned about
the environmental degradation, specially the rising of global temperature and thereby
melting of glaciers and ice-berg in the polar region and consequently rising of sea level
Which will directly affect the low lying countries of the world like Bangladesh? The
conscious people of the world are also concerned about the increase of Green House
Gases and Chlorofluorocarbons (CFCs) and thereby depletion of Ozone layer. As such
every person and specially the professionals must have greater role to check the
Environmental degradation. The contribution of the banking sector is playing significant
role to save the environment through their CSR, investment or other activities.
Most prominent of all, to save the environment, Green Banking is the greatest initiative
taken by the banks all over the world. The term Green Banking is popular worldwide
now-a-days. It is for stopping the environmental degradation and making this planet
habitable. The concept of Green Banking developed in the western countries has been
replicated by many developing countries. It means the eco-friendly
orenvironmentfriendlybanking and it also refers to ethical banking or sustainable
banking.
The banking sector is major economic agent which influences the economic growth and
development in terms of both quality and quantity by changing the nature of economic
growth. It is one of the major sources of financing and investment for commercial
projects which is one of the most important economic activities for economic growth.
Therefore, banking sector can play a pivotal role in promoting environmentally
sustainable and socially responsible investment. Banking sector is generally considered

6
as environmental friendly in terms of emissions and pollutions. Internal environmental
impact of the banking sector such as use of energy, paper and water are relatively low
and clean. Environmental impact of banks is not physically related to their banking
Activities but with the customers’ activities. Therefore, environmental impact of banks’
external activity is huge though difficult to estimate.
Moreover, environment management in the banking business is like risk management. It
increases the enterprise value and lowers loss ratio as higher quality loan portfolio
results in higher earnings. Thus, encouraging environmentally responsible investments
and prudent lending should be one of the responsibilities of the banking sector. Those
industries which have already become green and those, which are making serious
attempts to grow green, should be accorded priority to lending by the banks. This
method of finance can be called as “Green Banking”, an effort by the banks to make the
industries grow green and in the process of restoring the natural environment. This
concept of “Green Banking” will be mutually beneficial to the banks, industries and the
economy. Not only “Green Banking” will ensure the greening of the industries but it will
also facilitate in improving the asset quality of the banks in future. Banking and other
financial institutions are more effective towards achieving this goal for the kind of
intermediary role they play in any economy and for their potential reach to the number
of investors. Environment is no longer the exclusive concern of the government and the
direct polluters, but also the other partners and stakeholders in the business. It would
certainly give the much needed drive for the banking industry to expand the use of
environmental information in their credit extension and investment decisions. In this
background, the paper aims at discussing the issues of Green Banking and the
evaluation of this Green Banking practices in India.

RATIONALE OF THE STUDY

Banking system occupies an important place in a nation‘s economy. A banking

institution is indispensable in a modern society. It plays a fundamental role in the
economic development of a country and forms the core of the money market in an
advanced country. In recent times the banking sector over the world has been
undergoing a lot of changes due to deregulation, technological innovation, globalization,
environment etc. Banking sector in Bangladesh is lagging far behind in adopting these
changes. But they are trying to adjust their activities with the required necessaries and
adopting themselves as world class bank. As of late another challenge attach with
banks to concentrate their finance in the environment frankly industry and avoiding
waste and giving priority to society.
It is not an easy task because banks are also concerned about profit. That is why they
have to earn profit in such away where they can be able to give the priority of society
also. And the only solution is - GREEN BANKING.

7
Many developed countries have already triggered their activities on green banking.
Recently Bangladesh is also trying to commence it for the sake of environment and
social benefit. At the preliminary stage of commencing this banking system in
Bangladesh, I have found this opportunity to make my thesis paper on this subject. The
title of my study is The Evaluation of Green Banking practices in Bangladesh. Due
to apparently unusual weather patterns, rising greenhouse gases, declining air quality
and society demands that businesses also take responsibility in safeguarding the
planet, public concern of the state of environment has been growing significantly in the
last few years. Banks hold a unique position in an economic system that can affect
productions, businesses, and other economic activities through their financing activities.
Green bank do not only improve their own standards but also affect socially responsible
behavior of other businesses. However, if green banking simply results incurring
additional costs by a bank, it might never be accepted as common business practices
by the global banking industry. The positive relationship between green banking
strategy and profitability has not always been the case. Socially and environmentally
responsible banks can also be financially successful and have growth rate similar to, or
even better than that of their conventional competitors. In many cases, it is also proven
that with a well-managed green banking consumers could be willing to pay extra in the
knowledge that the products are environment friendly. Moreover, banks that mainly do
businesses with the depositors’ money cannot avoid responsibility to the society.
It is well known that governments in different countries intervened to save banks using
taxpayers’ money in response to 2008-09 bank failure during crisis. When the common
people have to take care of banks in their bad days, banks must be made responsible to
take care of the society as well.
Green Banking is the conducting of banking business in such a manner that helps the
overall reduction of external carbon emission. It promotes environment-friendly
practices by reducing carbon footprint from banking activities. This comes in many
forms such as using online banking instead of branch banking, paying bills online
instead of mailing them, opening up CDs and so on. Green Banking helps to create
effective and far-reaching market-based solutions to address a range of environmental
problems including climate change, deforestation, air quality issues and biodiversity loss
while at the same time identifying and securing opportunities that benefit
customers. As a requirement of the completion of my Master of Business Administration
degree under the Faculty of Business Administration, the preparation and submission of
this report is mandatory. In this era of global warming and climate change, to deliver the
right services are not sufficient for customers but also to practice Green Banking
concept for friendly environmental issue as the corporate social responsibility is
unavoidable.
Green Banking is an emerging concept from Bangladesh perspective. A little study has
been done on the evaluation of Green Banking Practices in Bangladesh. Moreover, all

8
the banks are presently moving towards this concept to express their devotion to the
protection and preservation of environment. As a student of MBA program,
it is crucial for me to go for an in-depth analysis on the industry to extract the detailed
findings regarding the study. The findings will represent the present scenario of Green
Banking practices, how it has been evolved overtime, who are the followers, possible
drawbacks in the policy and discrepancies found in banks’ policy from the standard
set by Regulatory Body (Bangladesh bank). The faculty of Business Administration and
the business sector will come to know the detailed situation of Green Banking Practices
in Bangladesh. They will also be made aware of the measures required to be
implemented to make this concept more effective.

SCOPE OF THE STUDY

Banking industry may address many issues to save environmental degradation and
conserve the ecological balance .That’s why green banking is introduced through the
world. It will be obligatory for each person to show respect to the environmental issues.
Otherwise, the environments where the concerned person lives will not be inhabitable
and as a whole the country and the globe will no longer be safe place. We have to use
resources carefully and keep in the mind that the reserve of the resources is not
unlimited and its excessive use may endanger the future generation. We have to think
that each of our activity has a specific impact on the environment. As a best creation of
Almighty, we have greater role to conserve the environment, maintain biodiversity, not
to endanger other fauna and flora and above all a green, healthy planet for safe and
sound living of our future generations.
Since banking industry is a vital institution in the economic and business activity round
the world, bankers cannot remain indifferent to this burning issue. The scope of this
report covers the commencement of Green Banking, its gradual emergence in
Bangladesh, roles of Green Banking, banks following this concept and deviation from
the standards set by Supreme Authority. The whole banking industry will be covered for
this study.

LIMITATIONS OF THE STUDY

Numerous problems have been encountered during the accomplishment of the study.
These problems may be
termed as limitations of the study, specified as follows:

9
  Time frame for the research was very limited.

 Green banking Initiatives is a new topic in Bangladesh. Phase-II is just going on

to the banking industry.

 Implementation time of following Green Banking by all scheduled banks is not

over yet. That’s why information is not available of the banks.

 Green banking initiatives of other banks are little that’s why good comparison of
bank to bank is not Possible

 Unavailability of written documents as required for making a comprehensive

study.

 Some supportive materials were not available during the completion of my report
i.e. concrete data/statistics on Green Banking in Bangladesh, Green Banking
policies of some banks etc.

 In many cases, up to date information is not published.

During completion of this report, essential and up to date information was not possible
to be gathered. To me, if it were possible, a fully fledged and comprehensive report
could have possibly been prepared.

OBJECTIVES OF THE STUDY

BROAD OBJECTIVES

The main objective of this study is to know and have a clear view of The Evaluation of
Green Banking Practices in India.

SPECIFIC OBJECTIVES

Along with the broad objective, some other specific objectives are also defined below:

• To know the basic concept about Green Banking.

• To know the present condition of Green Banking practices in Bangladesh.

10
• To evaluate the Green Banking performance of banks in Bangladesh.

• To find the historical evolution of Green Banking

• To know the objectives of Green Banking.

• To have knowledge about policy standard set by the Bangladesh Bank for the
application of Green Banking.

• To identify the major areas of efficiency or inefficiency of the banks regarding Green
Banking initiative.

GREEN BANK AND GREEN BANKING

A Green Bank is an ethical bank, a socially responsible bank and a sustainable bank.
Green Banking is providing innovative green products and support activities that are not
hazardous to the environment and help conserve the environment. Green Banking has
a role to safeguard the planet from unusual weather patterns, rising greenhouse gas,
and declining air quality, with the aim of ensuring economic growth which is sustainable.
The Four E's of Green Banking: Educate, Enable, Make it Easy and Be Earnest Green
Banking is not limited only to in-house green activities, but extends to facilitating Green
financing.
Green financing through due diligence checklists under Environmental Risk
Management (ERM) Guidelines is not intended to squeeze investment; rather it is for
sustainable finance. Green financing under Green Banking activities can make a great
contribution to the transition to resource-efficient and low carbon industries, i.e. green
industry and green economy in general. A Green Economy can be thought of as an

11
alternative vision for growth and development; one that can generate growth and
improvements in people’s lives in ways consistent with sustainable development. A
Green Economy promotes a triple bottom line: sustaining and advancing economic,
environmental and social well-being.

EVOLUTION OF GREEN BANKING

The financial sectors growing adherence to environmental management system is

attributed to the direct and indirect pressures from international and local Non
Governmental Organizations (NGOs), multilateral agencies and in some cases the
market through consumers. In the early 1990s, the United Nations Environment
Program (UNEP) launched what is now known as the UNEP Finance Initiative
(UNEPFI). Some 200 financial institutions around the globe are signatories of this
initiative statement to promote sustainable development within the framework of market
mechanisms toward common environmental goals. The objective is to integrate the
environmental and social dimension to the financial performance and risk associated
with it in the financial sector.
As the commitment of this UNEPFI statement goes, sustainable development is
regarded basic to the sound business management. It advocates for a precautionary
approach towards environmental management and suggests integrating environmental
considerations into the regular business operations, asset management, and other
business decisions of the banks. IFC’s environmental unit was established in 1991 for
reviewing each project for environmental assessment. Similarly, the US Export-Import
Bank regularly reviews while financing exports on the ground whether they are
environmentally sound. It will be noteworthy to mention that Netherland-based ABN-
Amro bank has developed certain Reputational Risk Management (RRM) policies to
identify, asses and mange nonfinancial present within its business engagements.
Similarly, some of the big international banks like ABN Amro, Deutsche, Standard
Chartered, HSBC Bank etc. look at environment issues discussed under Kyoto Protocol.
Going further,
the Dutch Government has made a formal request to banks in achieving sustainable
development. The dialogue between banks and government was established in 1999 to
initiate policies for environmental improvements through the development of new
financial products and services.
Similarly, the Rainforest Action Network (RAN) challenged the industry with high-profile
campaign
that highlighted cases in which commercial banks were ‘bankrolling disasters’ in 2000
in the US. In 2002, a global coalition of NGOs formed a network named ‘Bank Tract’ to

12
promote sustainable finance in the commercial sector. This coalition came up with a
resolution constituting six principles promoting environmental protection and social
justice by banks and this is popularly known as ‘Collevecchio Declaration’. The six
principles that this declaration advocated included commitments to sustainability, no-
harm, responsibility, accountability, transparency and sustainable market, and
governance. More than 200 organizations have endorsed this declaration and urged the
banks to incorporate these commitments into their business operation. The declaration
states that “Finance and Commerce has been at the center of a historic detachment
between the world’s natural resource base, production and consumption. As we reach
the boundaries of ecological boundaries of the ecological limit upon which all commerce
relies, the financial sector should take its share of responsibility for reversing the effects
this detachment has produced”. All these concerns for sustainable finance or green
finance have compelled the banking institutions to devise a common and coherent set
of environmental and social policies and guidelines that can be used to evaluate the
projects. A small group of banks along with IFC came together to initiate the process of
designing the common guidelines in October 2002 and came up with a guidelines in
June 2003 that is known as Equator Principles with 10 leading commercial banks
adopting these voluntary set of principles. This equator principle was subsequently
updated and the new revised sets of principles are launched in July 2006. The coverage
of projects being financed is expanded in this revised set of principles by lowering the
finance threshold from $50 million to $10 million. Presently 46 financial institutions from
16 countries with business operation in more than 100 countries have embraced this
equator principle. So this principle has become a common standard of project finance
that incorporated environmental and social issues in project finance. The activities of the
equator banks (banks adopting equator principles) are being reviewed by NGOs
worldwide and are being published whenever it is realized that they are not committed
to Equator Principle. IFC along with the Financial Times has initiated ‘Sustainable
Banking Awar’ since 2006. More than 104 financial institutions out of 151 entries from
51 countries have made it to the final lists of award in 2007. The number of banks
applying was up by more than 100 per cent compared to the previous year's 48 banks
from 28 countries. All the international initiatives towards integrating environmental
concerns into business operation of banks are voluntary in nature and are meant to
promote a common good of a better ecosystem. Voluntary commitment has its own
shortcoming in a competitive market. Unless the market for green money will increase,
the lenders will always have an incentive to postpone their social commitment and
prioritize the commercial interest in the short run. So demand for green money is a
precondition of green banking if it will be voluntary. A Government legislation that
makes banks accountable for the misdeeds of their clients will help promotes green
banking.
In March 2009, Congressman Chris Van Hollen in USA introduced a Green Bank Act
with the aim of
13
establishing a green bank under the ownership of the US government. Its objective was
to offer financial support to increase efficient energy usage, and reduce carbon
emissions and environmental pollution resulting from energy creation. Bank Technology
News has recently given Citigroup the US banking giant, top honors in its first ranking of
‘America's Greenest Banks’. The award highlighted the accomplishments of Citi’s
Sustainable Operations and Technology program, which includes dozens of initiatives
aimed at shrinking environmental footprints and controlling costs. In just one example,
Citi updated computer hardware across the 1,000+ Citibank branches in North America,
reducing energy costs by 15 percent a year, while improving the speed with which it
services customers. The Financial Times of London announced the Sustainable
Banking Awards last year. UK's Cooperative Bank won the 'Sustainable Bank of the
Year' award and only HSBC, among large global banks, was a runner-up in any
category. The good news is, BRAC Bank Ltd from Bangladesh became the regional
winner for
'Asian Emerging Markets Sustainable Bank of the Year', which they are also portraying
in all their bill boards and promotion campaigns. Good news for all of us.

REASONS FOR GREEN BANKING

Due to unusual weather pattern, rising greenhouse gas, declining air quality etc,
Businesses should come forward to take responsibility in safeguarding the planet.
Green Banking makes great contribution to the transition to resource-efficient and low
carbon industries i.e. green industry and green economy in general. Banks that were
once seen only as profit motive institutions have been adjusting to a more demanding
market and a more socially conscious society over the last two decades. Environmental
concern is at the centre of the green banking strategy. An increasing number of global
banks around the world are going green by launching environmental friendly initiatives
and providing innovative green products. In the long run, the trend towards green
banking will be largely driven by consumer behavior. Common people and consumers
are becoming increasingly aware of the responsible behavior of businesses.
The environment and climate change must be taken into consideration in extending that
sentiment to
some of the more unlikely facets of our daily lives. Banking and finance is one of the
areas that can do anything about, but there's a surprising amount that you can do to

14
ensure that your money and finances are being managed in a green, ethical way. It is
possible to know whether the chosen bank operates as a carbon neutral business.
Banks are turning themselves into carbon neutral operations, meaning that the amount
of CO2 emitted during the day to day activities of that bank is neutralized by another
activity that utilizes CO2. The smaller banks and building society have been
commended for pioneering the carbon neutral campaign.
Green banking is committed to invest their money in an ethical way by investing in good
sectors. Public
were not aware before what for the money deposited is utilized by the bank. Nowadays
using green banking, banker assures the depositor where his money will be invested.
This includes projects funded for renewable energy technology, regeneration in the
developing world and investments to organizations for aid, environmentalism and
human rights. The bankers explain which investments they will be supporting with your
money, and give you a progress report on how it is going. Such transparency helps for
the bank to mobilize more funds.

Green banking is very important in mitigating the following risks involving the banking
sector:

 Credit Risk:

Due to climate change and global warming, there have been direct as well as
indirect costs to banks. It has been observed that due to global warming,
there have been extreme weather conditions which affect the economic
assets financed by the banks, thus leading to high incidence of credit default.
Credit risk can also arise indirectly when banks lead to companies whose
businesses are adversely affected due to changes in environmental
regulation.

 Legal risk:

Banks, like other business entities, face legal risk if they do not comply with
relevant environmental regulation. They may also face risk of direct lender
liability for cleanup costs or claims for damages in case they actually take
possession of pollution causing assets.

 Reputation Risk:

15
 Due to increasing environmental awareness, banks are more prone to
reputation risk, if their direct or indirect actions are viewed as socially and
environmentally damaging. Reputation risks emerge from the financing of
environmentally objectionable projects.

SOME GREEN BANKING SLOGANS OF BANKS

a) Save paper, save trees

b) Conserve energy, conserve natural resources

c) Pay your bills online

d) Turn off the tap when no t needed

e) Always use a cloth bag

f) Reduce, reuse and recycle

g) Digitize yourself

h) Think before you press the button

i) Everything has two sides

j) Be paperless- kick the habit

k) Unplug electronic devices while not in us.

ROLE OF GREEN BANKING

A banker or a banking industry may address many issues to save environmental
degradation and conserve the ecological balance. Green banking is a good way of
making people aware of global warming. Each business man will contribute to the
environment and make this earth a better place to live and enjoy. In addition, it is
envisaged that this institution is going to work towards reducing the country’s
dependence on foreign energy sources, fighting climate change and creating additional
jobs through the provision of healthier energy generation facilities. Green finance may
cover all the financial services related to the promotion and development of green

16
industry and green economy where the environmental benefits interims of reduced
carbon dependency or reduced ecological scarcity are the most significant. Green
banking practices of banks are connected with both internal operation and product
ecology. Some banks are engaged in carbon offsetting, which refers to the effort of
canceling out the climate changing effects of its own greenhouse gas emissions. Banks,
by using their commercial lending and securities underwriting, may catalyze the
necessary transition to an economy that minimizes greenhouse gas pollution and
relies on Energy efficiency. There is no doubt that the combined threats associated with
climate change and biodiversity loss call for a deeper commitment of resources and
investment from all stakeholders. In the endeavor of emission reduction and
conservation, stakeholders have been contributing in different ways in different
countries and regions. Green banking is just one of the initiatives by stakeholder - banks
and financial institutions. The environmentally responsible banks do not only improve
their own standards but also affect socially responsible behavior of other businesses.
The banks will have to gofer online banking by eliminating paper waste, saving gas and
carbon emission, reducing printing costs and postage expenses. Bangladesh Bank, the
central bank, has a greater role in shaping up a concrete guideline for green banking
practices in Bangladesh. According to central bank, each bank and financial institution
can formulate a strategy and guideline for Green Banking and Green Financing.
The commercial banks are to develop green banking policies and show general
commitment on environment through in-house performances. A high-powered
committee will be responsible for reviewing the banks' environmental policies, strategies
and programs .The committee will be comprised of directors from the board in case of
scheduled Bangladeshi banks and regional chief of global office and members from the
top management including chief executive in case of foreign banks. The banks will
allocate a considerable fund in their annual budget for green banking and
set up a separate green banking unit. A senior executive should head the unit, which
will report to the high powered committee time to time. They will have to comply with the
instructions stipulated in the detailed guidelines on Environmental Risk Management.
The banks will also incorporate environmental and climate change risks as part of the
existing credit risk methodology prescribed to assess a prospective borrower. The
banks should take measures to save electricity, water and paper consumption,
according to the BB guidelines. A 'Green Office Guide' or at least a set of general
instructions should be circulated among the employees. Instead of relying on printed
documents, online communication should be extensively used (where possible) for
office management. Energy saving bulbs should replace the regular ones in
branches/offices of the banks. They should make plans to use solar energy on their
premises, and encourage employees to purchase energy efficient cars.

GREEN BANKING PRACTICES

17
Practices of in house Green Banking:

 Waste Management:

A green banker must be cautious about wastage and waste management. We should
try to control the wastage of resources like water, gas, electricity, paper, foods etc. For
example, if we draft our letters on a computer rather than in paper, it will save millions of
paper as well as thousands of trees that provide raw materials for paper production.
Similarly, if we select a location of the branch of a bank with sufficient access to light
and air, it will save huge electricity and create a healthy environment. Wastages must
be grouped like organic and inorganic wastage. Organic materials like food, vegetables,
animals etc. can be recycled for manure, gas and electricity etc.
The inorganic material like paper, bottles, pots etc. can be recycled. Wet and
degradable materials can be processed directly keeping under the soil. The recycling
materials should be disposed off at the respective disposal site and the rotten items
should be buried under the soil and as such, pollution can be protected.
 Clean and hygienic environment:

A green banker will not throw any waste, bottles or packing materials here and there.
Each group of waste should be kept in a separate place, which does not pollute the
environment and all the wastes must be disposed off separately. A green banker will not
spit or cough on the floor, walls or on the road.

 On line statements, emailing documents:

We must send account statements and balance confirmation etc. to the clients through
online and through email, which will save paper, time, cost and above all the
environment. We may use these technologies for our clients as well as interbank
correspondence.

 Sound Pollution:

We should keep our voice low when we converse and also convince our clients
maintain this for the sake of healthy working environment in the branches.

 Installation of solar panel in the rural branches and using high mileage
vehicles or using shared vehicles instead of personal vehicle:

18
Since Bangladesh is an energy deficit country we can install solar panels in all
Branches as an alternative energy source. We can also use the vehicles which
consume less fuel which will save huge fuel import of the country.
We can also use big vehicles to carry the employees of the Banks instead of personal
vehicle to reduce fuel as well traffic jam in the roads.

 Practices by the Bankers in their business area

 Financing only the green projects:

Bankers must be aware of the environmental issues and they must go for financing the
projects that do not pollute the environment. The industries that are financed by the
banks must have effluent treatment plant (ETP), recycling facilities and smoke and gas
arresting unit. The industries must not release any kind of effluents, chemicals or smoke
to the environment. Banks must not finance any dirty project that pollutes the
environment.

 Voluntary activities of Banks:

Banks should take initiative to make their clients aware by organizing seminar and
symposium. They can organize awareness campaign in schools and colleges. They can
participate in the tree plantation and cleanliness programs in city areas.

 Working on specific green project

Our country has lot of problems of proper waste management, drainage and sanitation,
and affected by river pollution, water pollution by pesticides etc. Every bank can
undertake a specific green project for removal of existing polluting substances from the
ecosystem.

 Areas of Green Banking

Green Bank comes in many forms; using online banking instead of branch banking,
paying bills online instead of mailing them, opening up CDs and money market
accounts at online banks instead of large multi-branch banks.
Green Bank looks at green banking in three areas - operational, technological and client
acceptance. Banks have made improvements in the operational area such as replacing

19
our daily courier service with scans and electronic delivery. All employees receive
paychecks and reimbursement checks electronically.

GREEN BANKING PRODUCTS AND SERVICES

Financial institutions are rushing to market with new or re-packaged product and service
offerings from green auto insurance to innovative pro-eco mortgages and new
sustainability-backing investment funds.

Green Deposits:

Banks can offer higher rates on CDs, money market accounts, checking Accounts and
savings account if customers opt to conduct their banking activities online.

Green Mortgages and Loans:

A green mortgage offers better rates or terms for energy efficient houses. Green
mortgages can allow home buyers to add as much as an additional 15 percent of the
price of their house into loans for upgrades including energy-efficient windows, solar
panels, geo-thermal heating or water heaters. The savings in monthly energy bills can
offset the higher monthly mortgage payments and save money in the long run. The
Energy Efficient Mortgage (EEM) is a type of Housing and Urban Development-
approved green mortgage that will credit you for your home’s energy efficiency in the
mortgage itself. Many home improvements also qualify for the energy tax credit. Anyone
undertaking an energy-saving house project should shop around for a bank that offers a
special rate for a green mortgage or loan.

Green Credit Cards:

A green credit card allows cardholders to earn rewards or points which can be
redeemed for contributions to eco-friendly charitable organizations. These cards offer
an excellent incentive for consumers to use their green card for their expensive
purchases. Imagine the millions of dollars that could be raised for worthwhile
environmental groups if green credit cards really took off.

Green Reward Checking Accounts:

A product called reward checking accounts pays a bonus rate to

20
customers who go green. Customers can earn higher checking account rates if they
meet monthly requirements like receiving electronic statements, paying bills online or
using a debit or check card. With this banking product higher rates and eco-friendly
livings go hand-in-hand.

Strengths-

 Environment Friendly:

Green Banking is environment friendly. It’s a paperless banking system which keeps the
environment clean and safe by erasing paper use.

 Reducing carbon emission:

As discussed earlier, the saving of paper entails saving of trees. Thus this concept is
eco-friendly in one side and on the other side it is reducing carbon emission.

 Cost Saving:

Being a paperless banking system, it is capable of saving cost that could be incurred
otherwise.

 Space Saving:

As there is no much paper used in green banking, the self use can be reduced and it
helps the surrounding look decent.

 Credit Risk Reduction:

Financing Green Projects helps reducing the risk of defaulting of repayment.

 Fastest Service:

As everything is computerized, the service demanded by the customers can be

delivered as fast as possible.

 Enhancement of Performance:

21
It not only enhances performance of the service rather it also enhances the
performance from human side that provides the service to the customers.

 Green Reputation:

Adoption of Green Banking increases the Green Reputation of a company which proves
the contribution to the environment.

 Value Maximization:

There is a positive relation between adoption of Green Banking and wealth

maximization or value maximization of the company. Adoption of Green Banking
reduces cost and reducing cost increases the value on the other side.

 Data Loss Reduction:

As there is no use of hardcopy, loss of that hard copy containing valuable information
can be reduce
Weaknesses

 Huge Initial Cost:

Adoption of Green Banking involves huge investment at the beginning side.
Going automated incurs a huge spending in technology and machines. Besides,
there are other set up related costs too.

 Initial Training Cost:

Not only technology and machineries need to be updated but also the major
component, skill of the Human, needs to be updated as well to keep pace with
the newly adopted system. That can be done by training them which needs huge
costs too.

 System may catch error:

As everything is automated, chances are there that the system might undergo
some errors at some point of time due to the technical difficulties.

 Inflexibility:
The adopted system may be inflexible to use properly even after the proper
training of the employees.

22
  Server Crash:
The worst thing ever in automated system is that, the server can be crashed
which can wipe all data away if anything goes wrong in the system.

Opportunities

 To be recognized as a green contributor:

Adoption and effective utilization of Green Banking system will help an institution to be
recognized as a contributor to the environment and be rewarded for that as well.

 Contribution to the economy:

Potentiality is there that Green Banking followers can contribute to the economy by
introducing innovative Green products that have substantial effect on the economy of
the country.

 Awards:
Government usually gives different awards to the contributors to the environment by
their Green activities. So there are possibilities to win the awards.

 International Recognition:
Apart from domestic awards, there are chances to get the international awards and
international recognition as well.

 Role model:
By the international recognition, one can be branded as role model and top contributor
to the global environment.

 Assistance from the Regulatory Body:

Green companies get assistance from all regulatory bodies during any distress.

Threats

 Data Loss:
The major threat of automated banking system is data loss if there is anything wrong
goes with the system.

23
  System Crash:

If the whole system crashes, the whole data will be wiped which is one of the major
threats to this automated banking.

POLICY GUIDANCE OF GREEN BANKING

Now it is the high time for the FIs to adopt a comprehensive Green Banking
Policy in a formal and structured manner in line with global norms so as to
protect environmental degradation and ensure sustainable banking
practices. With a view to developing green banking practices in the country,
an indicative Green Banking Policy and Strategy framework has been
developed for the FIs in the following manner. Green Banking Policy needs
to be covered through time frame work which will be segregated into 3
phases.

PHASE 1

FIs are to develop green banking policies and show general commitment on
environment through in-house performance. The time lining for the actions to be taken
under Phase-I should not exceed June 30, 2014.

a. Policy Formulation and Governance

FIs shall formulate and adopt broad environmental or Green Banking policy and
strategy approved by their Board of Directors. A high powered Committee comprises of
directors from the Board in should be responsible to review the FIs’ environmental
policies, strategies and program. FIs shall approve a considerable fund in their annual
budget allocation for green banking. FIs are required to establish a separate Green
Banking Unit or Cell having the responsibility of designing, evaluating and administering
related green banking issues of the FIs. A senior executive should be assigned with the
responsibility of heading the unit. The unit will report to the high powered committee
time to time.

24
 b. Incorporation of Environmental Risk in CRM

FIs shall comply with the instructions stipulated in the detailed guidelines on
Environmental Risk Management(ERM) in consideration of a part of the Green Banking
Policy. FIs shall incorporate Environmental and Climate Change Risk as part of the
existing overall credit risk methodology prescribed to assess a prospective borrower
from both credit and environmental risk point of view. This will include integrating
environmental risks in the checklists, audit guidelines and reporting formats. All of this
will help to mainstream Environmental Risk that cover possible sources of
Environmental Risk such as Land use, Climate change related events (cyclone,
drought),animal diseases/pathogens such as avian influenza, solid waste including
waste feed, animal waste, carcasses, sediments, wastewater discharges, hazardous
materials, will be reviewed under Environmental Due Diligence(EDD) checklists.

c. Initiating In-house Environment Management

FIs shall prepare an inventory of the consumption of water, paper, electricity, energy
etc. by its offices and branches in different places. Then it should take measures to
save electricity, water and paper consumption. A' Green Office Guide' or at least a set
of general instructions should be circulated to the employees for efficient use of
electricity, water, paper and reuse of equipment’s. In place of relying on printed
documents, online communication should be extensively used (where possible) for
office management and make sure that the printers are defaulted to duplex for double
side printing to save papers. FIs may apply Eco-font in printing to reduce use of ink, use
scrap paper as notepads and avoid disposable cups/glasses to become more eco
friendly. Installation of energy efficient electronic equipment’s and automatic shutdown
of computers, fans, lights, air coolers etc. will help reducing electricity consumption.
Energy saving bulbs should replace normal bulbs in branches/offices of the
FIs. FIs should make plan to use solar energy at their premises to save electricity. FIs
should take steps to save energy from corporate business travel and encourage
employees to purchase energy efficient cars (that consume less fuel) can reduce gas
and petroleum consumption. FIs should give more emphasis to make the easiest way to
help environment by eliminating paper waste, saving gas and carbon emission,
reducing printing costs and postage expenses.

d. Introducing Green finance

Eco friendly business activities and energy efficient industries will be given preference in
financing by FIs. Environmental infrastructure such as renewable energy project, clean
water supply project, wastewater treatment plant, solid and hazardous waste disposal
plant, bio-gas plant, bio-fertilizer plant should be encouraged and financed by FIs.
25
Consumer credit programs may be applied for promoting environmental practices
among clients.

e. Creation of Climate Risk Fund

FIs should finance the economic activities of the flood, cyclone and drought prone areas
at the regular interest rate without charging additional risk premium. However, FIs
should assess their environmental risks for financing the sectors in different areas for
creating a Climate Change Risk Fund. This will be used in case of emergency. FIs
would ensure regular financing flows in these vulnerable areas and sectors. The fund
could be created as part of FIs’ CSR expenditures.

f. Introducing Green Marketing

Green marketing is the marketing of products that are presumed to be environmentally

safe. Green marketing incorporates a broad range of activities, including product
modification, changes to the production process, packaging changes, as well as
modifying advertising. It refers to the process of selling products and/or services
based on their environmental benefits. Such a product or service may be
environmentally friendly in itself or produced and/or packaged in an environmentally
friendly way. FIs should use environmental causes for marketing their services to
consumer. Green marketing is expected to help awareness development among
common people.

g. Supporting Employee Training, Consumer Awareness and Green Event

Employee awareness development and training on environmental and social risk and
the relevant issues should be a continuous process as part of the FIs’ Human Recourse
Development. Awareness development among consumers and clients would be a
continuous job of a FI under its public relation department.

PHASE 2

The time lining for the actions to be taken under Phase-II should not exceed December
31, 2014.

a) Sector Specific Environmental Policies

FIs need to formulate strategies to design specific policies for different environmental
sensitive sectors such as Agriculture, Agri-business (Poultry and Dairy), Agro farming,

26
Leather(Tannery),Fisheries, Textile and Apparels, Renewable Energy, Pulp and Paper,
Sugar and distilleries, Construction and Housing, Engineering and Basic Metal,
Chemicals (Fertilizers, Pesticides and Pharmaceuticals), Rubber and Plastic Industry,
Hospital/Clinic, Chemical Trading, Brick Manufacturing, Ship breaking etc.

b) Green Strategic Planning

A FI should determine green targets to be attained through strategic planning. FIs

should determine set of
achievable targets and strategies, and disclose these in their annual reports and
websites for green financing and in-house environment management as well. For in-
house environment management, the target areas should cover attaining energy
efficiency in the form of the use of renewable energy, reduction of electricity, gas, and
petrol consumption, reduction of Green House Gas (GHG) emissions, issuance of e-
statements, electronic bill pay, saving papers, environment friendly office buildings etc.
For Green Financing, the target areas should cover reducing loans for certain
environmentally harmful activities, attaining a particular percentage of environmental
loans as percentage of total, introducing eco-friendly financial products etc.

c) Setting up Green Branches

A Green Branch should be featured by the provision of the maximum use of natural
light, use of renewable energy, use of energy saving bulbs and other equipment’s,
reduced water and electricity use, use of recycled water etc. Such a branch of a FI
would be specifically designated as a ‘Green Branch’. A Green Branch will be entitled to
display a special logo approved by Bangladesh Bank. The criteria for certification of a
‘Green Branch’ will be circulated by Bangladesh Bank in due course of time.

d) Improved In-house Environment Management

Strategy of reuse, recycling of materials and equipment, and source reduction and
waste minimization strategy should be part of in-house environmental management in
Phase-II. FIs should increasingly rely on virtual meeting through the use of video
conferencing in lieu of physical travel which would help saving cost and energy.

e) Formulation of FI Specific Environmental Risk Management Plan and

Guidelines

27
A FI should develop and follow an environmental risk management manual or
guidelines in their assessment and monitoring of project and working capital loans. In
addition to the compliance of national regulation the FIs may set internationally
accepted higher environmental standards. In this connection, Green initiatives by a
group of FIs will not only be effective but will also offer competitive advantage. FIs’
alliances may prepare standard and guidelines for themselves for improving Green
Banking practices.

f) Rigorous Programs to Educate Clients

Clients and business houses should be encouraged and influenced to comply with the
environmental regulations and undertake resource efficient and environmental activities.
FIs should introduce rigorous programs to educate clients

g) Disclosure and Reporting of Green Banking Activities

FIs should start publishing independent Green Banking and Sustainability reports
showing past performances, current activities, and future initiatives. Updated and
detailed information about FIs’ environmental activities and performances of major
clients should be disclosed.

PHASE 3

A system of Environmental Management should be in place in a FI before the initiation

of the activities of Phase-III. FIs are expected to address the whole eco-system through
environment friendly initiatives and introducing innovative products. Standard
environmental reporting with external verification should be part of the phase. The time
lining for the actions to be taken under Phase-III should not exceed June 30, 2015.

a. Designing and Introducing Innovative Products

Alongside avoiding negative impacts on environment through banking activities, FIs are
expected to introduce environment friendly innovative green products to address the
core environmental challenges of the country.

b. Reporting in Standard Format with External Verification

FIs should publish independent Green Annual Report following internationally accepted
format like Global Reporting Initiatives (GRI) targeting their stakeholders. There should

28
be arrangement for verification of these publications by an independent agency or
acceptable third party.

c. Reporting Green Banking Practices on Quarterly Basis

FIs shall report their initiatives/activities under the said program to Green Banking and
CSR Department of Bangladesh Bank in specified format (Annexure-A) on quarterly
basis. FIs shall submit their first quarterly report on September 30, 2013 basis within
October 15, 2013 and similarly they will be required to continue to submit reports on the
subsequent quarters within the next 15 days of the respective quarter end. Is shall keep
their annual report and websites updated with the disclosures on green banking
initiatives/activities.
d. The compliant FIs practicing Green Banking will have the following
preferential treatments:

(i) BB will award points to FIs on Management component while computing

CAMELS rating where there will ultimately be a positive impact on overall
rating of a FI.

(ii) BB will declare the names of the Top Ten FIs for their overall performance in
green banking activities in the BB websites.

(iii) BB will actively consider green banking activities/practices of a FI while

according permission for opening new FI branch.

e. Environment Friendly CSR:

Globally, the notion of Corporate Social Responsibility (CSR) is fast gaining acceptance
as the contribution that businesses can and should make voluntarily towards
environmentally sustainable and socially equitable development. Besides the usual
financial reporting, ‘nonfinancial’ or ‘sustainability’ reporting is accordingly also fast
gaining usage. Stated briefly, CSR is about (i) taking stock of the economic, social, and
environmental impacts of a business, (ii) mitigating the negative impacts and bolstering
the benign impacts, (iii) taking up action programs and community investments to
reduce social exclusion and inequality and to address the key sustainable development
challenges (BB CSR Annual Report 2008).

Green Activities

29
Green activities in financing include

 Carry out environmental risk assessment of projects, financing only those that
meet environmental safeguards/sustainability guidelines.

 Provide green loan to promote solar energy, biogas plants, effluent treatment
plants and other energy saving output practices like Hybrid Hoffman Kilns in brick
fields.

 Develop green banking products for clients.

 Promote growth of mobile banking and online banking.

 Include environmental sustainability support initiatives in corporate social

responsibility (CSR) programs, inter alia including financial support to climate risk
fund.

DATA ANAYSIS AND INTERPRETATION

1. Gender of respondent ?

Male 65
Female 35

No. of respondent

Male
35 female

65

30
INTERPRETATION

There are 65% male respondent there and 35% female respondent are there who will answer to
our question.

2.Age Group of respondent

AGE NO. OF PEOPLE

18 to 24 52
25 to 30 24
31 to 40 16
41 & above 08

31
 8

16
18-24
25-30
52 31-40
41& above

24

INTERPRETATION

Among the respondent 52 people are between 18-24 years of age group, and 24 people are from
25-30 years of age group, and 16 people from 31-40 years, and the remaining people from age
group of 41 & above

3 Occupation of respondent

OCCUPATION NO. OF PEOPLE

Self employed 8
Professional 12
 Salaried 24
House wife 6

Student 39
Other 11

32
 11 8

12
self e
professional
salaried
housewife
39 student
24
other

4.From where did you get information about green banking ?

INFORMATION SOURCE NO. OF PEOPLE

Internet 34
 Newspaper 08
TV, advertisement 36
Relatives,/friends  14
 others 08

33
 8

14
34
net
newspaper
tv
relatives
other

36 8

INTERPRETATION

Through the internet the 34% people are getting aware about the product and 08% people are get
information about the product from newspaper. 36% people get information about the product
through the TV and Advertisement and 14% people get information through the relatives and
friends. 8% people get information through other sources.

5. Do you think Green banking is the best way of sustainability?

yes 88
No 12

34
 12

yes
no

88

INTERPRETATION

Only 12% people say that green banking is not the best way of sustainability and remaining 88%
say it is the best way .

6. Rank the following services of Green Banking?

SERVICES RANK NO OF USERS

ATM’S 1 33
INTERNET BANKING 2 21
MOBILE BANKING 3 18
GREEN CHANNEL 4 16
COUNTERS

35
 GREEN CARD 5 12

12

33
ATM'S
16
INTERNET BANKING
MOBILE BANKING
GREEN CHANNEL COUNTERS
GREEN CARD
18
21

INTERPRETATION

33% of users rank the ATM’S on 1st rank, 21% rank the internet banking 6n 2nd, 18% of users
rank 3rd to mobile banking , 16% of users rank 4th to the green channel counters and 12% users
rank 5th to the green card services.

7.GREEN BANKING SERVICES ARE DIFFICULT TO USE?

YES 74
NO 26

36
 24

YE
S

76

8. obstacles faced by in availing green banking services?

PARTICUARS PERCENTAGE
Lack of knowledge 31
Lack of confidence in handling 15
No direct interactions with second party 08
Fear about security 46

37
 31
Lack of knowledge
Lack of confidence in
46 handling
No direct interactions with
second party
Fear about security

15
8

9.Do you prefer using green banking services?

Yes 81
No 19

38
 19

Ye
s

81

FINDINGS

1.From the survey we found that many people are unaware whole feature, advantages
and activity of green banking.

2.People are not effectively using computerized banking facilities.

39
3.The data shows that many are having fear about security and less confidence in
handling.
4.Green banking avoids as much paper work as possible and rely on online or
electronic transactions for processing so that we get green credit cards and green
mortgages. Less paperwork means less cutting of trees.

5.It also involves creating awareness to banking business people about environmental
and social responsibility enabling them to do an environmental friendly business
practice

6.Green banking as a concept is a proactive and smart way of thinking with a vision for
future sustainability.

SUGGESTIONS

• Communicate through press and Construct websites and spread the news.

• Impart education through E-learning programmers.

• Bank should enhance security and create awareness among the people.

• Making green banking as part of annual environment reports.

• Training and development of relevant skills among bank employees.

CONCLUSION

Government should take necessary steps to enforce existing environmental regulations

and formulate appropriate rules to ensure pollution free in the country. The Central Bank
of Bangladesh can play a pro-active role in this regard. Much more is expected from
civil society organizations in the form of awareness development, research activities,
and business monitoring. ‘Consumer Awareness’ is the area where Bangladesh needs
remarkable change, because green banking is largely driven by consumer behavior and
consumption patterns. For rapid change among consumers and businesses, a collective

40
endeavor of government, media, NGOs, and Banks will be required. An isolated effort
by banking communities may not bring much. On the other side of the coin, we will have
to take strong stance against our internal polluters. As banks indirectly contribute to
environmental pollution through investing in different pollutant industries, we will have to
take steps against all the wrong doing. Bangladesh Bank which has the legal power to
shape the behavior of the banks, it will have to force all the banks to implement green
banking policy to curb its own environmental pollution, giving loans to environmentally
friendly projects and reducing investment in environmentally harmful projects. This
green banking can play a significant role in implementing the broader concept like
sustainable economic development.
As far as green banking is concerned Bangladeshi banks are far behind their
counterparts from developed countries. The implementation status of the study
highlights the fact that banks in Bangladesh are beginning to understand the importance
of introducing green banking into their mainstream operations. Still, no bank in
Bangladesh has been found in the UNEPs signatories of the Equator Principles (which
is regarded as one of the most important standards for responsible financing). The
general picture presents a transition from some notable individual actions in a
consistent and measurable environmental performance for most banks. According to
this study, though the banking industry in Bangladesh are in the intensification phase
passing through the foundation phase within the time frame, some banks are yet to
stand on its feet. A few commercial banks are engaged in inhouse
environment management and are contributing towards environment friendly finance
through their Green Energy Loans. However banks have a lot more scope to contribute
and should make adequate investment in generating renewable energy.

RECOMMENDATIONS

Banks in Bangladesh are continuously working on green banking policy to make

themselves more responsible corporate citizen. The banks think that green banking is
not going to erode its profitability rather it will help the bank to reduce its operating cost
and also help to find some non-traditional sources of lending. As the consumers are
becoming more concerned about the environment and they are realizing that banks can
play a major role by stop investing in environmentally hazardous projects. This study
reveals the following suggestions:

A) Environmental Governance within the Bank:

Though some banks have their green banking unit at the head office, no bank maintains
green officer at the branch level to monitor their GB compliance internally and

41
externally. BB should ensure environmental governance within the branch by recruiting
such personnel at the branch level.

B) Environmental Awareness among Bank Employees:

Bank employees carry out the green banking concept from Bank to client. It can only be
possible when employees will be environmentally aware.

C) Feedback from the Regulatory Agencies:

Though banks report to BB about GB practices periodically, few bank staffs think that
BB does not give proper feedback to the GB reporting. Reward or punishment in favor
of/against GB reporting should be realized very shortly among banks and customers.

D) Positive Attitude toward Green Banking:

Most of the banks convey the head office as well as BB order as routine work regarding
green banking. Different Government as well as non-government agencies should
motivate bankers and entrepreneurs to shift from profit seeking to environment-friendly
business. In this regard, they can make mass awareness toward sustainable business
practices.

E) Mass Awareness about Green Banking:

Still most of the clients are not well acquainted with green banking knowledge.
Moreover, most of the banks do not take necessary steps to aware them. In some
cases, clients still desire printed documents such as account statement. Banks should
motivate clients to receive online banking service at every stage. Bank should arrange
events for clients at the branch level. Sufficient events should organize for primary
group i.e. clients for changing their attitude toward green banking.

F) Capacity Building:
Staffs of each bank are not also well acquired of green banking knowledge. Very few
banks arranged programs on green banking for employees at the branch level. Bank
should arrange trainings and workshops on green banking for every staffs regularly.

G) Credit/ Investment Management:

Few banks were found strict in following the environmental risk rating (EnvRR) in their
core risk management (ERR). Some Banks follow the EnvRR strictly because of
maintaining bank soundness. On the other hand, some other follows this rating in
investment due to direct or indirect pressures from various agencies. Based on EnvRR,
banks should show zero tolerance in investing fund on eco-friendly deals.

H) Eco-friendly Production Technology:

42
Bank executives and clients opine that the high cost of installation and complex
maintenance are the major obstacle to green production technology. Environment-
friendly technology should, therefore, be low cost and better output providing technology
that will be viable solution for green banking. Competent authority may offer tax waiver
or more subsidies over costs that would encourage adopting environment-friendly
technology.

BIBIOGARPHY

1.http.wikipedia.org/wiki/Indian Bank_ Association,

2.http://seniorsecondary.tki.org.nz/Socialsciences/Education-for-
sustainability/Keyconcepts/Aspects-of-sustainability

3.http://toolkit.smallbiz.nsw.gov.au/part/17/86/371

43