Fossil Free and Beyond: Green Banking at Walden Mutual
We recently partnered with Bank.Green as part of their Fossil Free Alliance. Bank.Green is a not-for-profit organization tackling the climate crisis by addressing the financial networks backing big fossil fuel projects. Members of the Alliance are “Fossil Free Certified” - sustainable financial institutions who’ve pledged not to finance new fossil fuel companies or projects. As a sustainable bank, we’re excited to be associated with a group of some of the world’s most progressive green banks, especially at such a critical time in our collective battle against climate change.
Where you bank matters. Where your savings spend the night has profound implications for our collective battle to fight climate change. Climate activist Bill McKibben and Beneficial State Bank founder Kat Taylor (BSB is also Fossil Free Certified) recently calculated that keeping $125,000 in an account at one of America’s biggest banks could produce as much carbon as all the heating, driving, flying, cooling and cooking an average American does in a year.
Large banks play a critical role in facilitating new fossil fuel projects, with 90% of new capital for fossil fuels companies derived from loans or bonds. The world’s 60 largest banks have financed $5.5 trillion in fossil fuel projects since the adoption of the Paris Agreement in 2016, when 195 countries agreed to a series of climate mitigation measures - and the four largest U.S. banks lead the way. Those four institutions together account for one quarter of all fossil fuel financing over the past six years.
In response, a growing number of institutions have made pledges to phase out their investment in fossil fuel projects. But progress is slow. The Glasgow Financial Alliance for Net Zero (GFANZ), an initiative including more than 450 organizations across the globe who’ve pledged to align their investments to limit global temperature rises, includes 56 banks that have provided $270 billion in fossil fuel financing since joining.
Fossil fuel divestment by our largest financial institutions is an obviously critical step in securing the long-term viability of our planet, but as McKibben and Taylor put it, “Environmentalists aren’t asking for much: only that banks stop lending for the expansion of the fossil fuel industry.” Activists protested throughout the month of March in front of branches of the largest American banks, asking for these institutions to clear the lowest of thresholds - stop funding the future destruction of our home.
From Less Harm to Active Good with Socially Responsible Banking
We can and should be asking for more from the places we allow our money to spend the night - from not causing active harm...to proactively supporting positive impact.
That's the standard many people already hold companies they purchase goods or services from - when they make our clothes, cars, or cosmetic supplies. But banks are a notable exception for most.
Money is an incredibly powerful force in our financialized world. It mediates our relationships with so many parts of life, including those that - at least at first glance – seem unrelated. Access to money often determines the quality of a child’s education; it dictates access to quality health care; it influences the art that gets created…and it frequently shapes what food ends up on our plates.
It’s often said that money is just a tool, an empty vessel - which is true, in a way. But it’s also inescapable - and flows through the channels carved by people and systems that’ve come before. When broken systems funnel it towards fossil fuel projects, it becomes destructive. Working to stanch those flows is important work, represented by the other green banks that are members of the Fossil Free Alliance.
Beyond preventing our money from causing active harm, the same tool can instead enable the flourishing of our regional food system. That’s why we started a sustainable bank - to create new paths for the flow of money, away from public harm and towards something better. When your deposits spend the night at Walden Mutual, they fund the farms, food brands, non-profits, and other sustainable businesses that are driving food systems change in New England and New York.
Even better – impactful, mission-driven work doesn’t have to feel stale or boring. Our Summer Farm Dividend, product samples, and discounts we'll offer depositors at our partner-businesses in the near future are all early examples of what we’re imagining…but more socially responsible banking is on the horizon. Join us as we work to do our part in the fight to stop climate change, and push further to use our money for good.