Indian banks not green, says UK research

Prasun Sonwalkar
London, June 13 (PTI) Are Indian banks green and
acting ethically about the environment? Not quite, according
to research conducted by a British university.
The University of Leicester's Department of Geography is
investigating the reasons why Indian banks have yet to commit
to the Equator Principles – a set of environmental and social
guidelines to which 62 banks and financial institutions
worldwide have become signatories.
As part of the research, doctoral student Sophie
Hadfield-Hill conducted 40 interviews with CEOs and
senior management of Indian banks and leading companies.
"There is certainly a lack of awareness of the Equator
Principles in India. Leading banks are vaguely conscious of
the guidelines, however, the public sector is waiting to be
led by the Reserve Bank of India and the private sector banks
seem to only want to commit if there is regulation or
financial incentive," said Hadfield-Hill.
She also blamed the lack of interest on the issue among
Indian consumers for the failure of banks to declare their
commitment to environmentally and socially responsible
business.
"Work needs to be done to make the guidelines more
relevant to emerging economies. Firstly, however, Indian banks
need to be made fully aware of the environmental and social
guidelines to which banks worldwide are agreeing to," she
said.
It will be a huge financial burden for banks committing
to environmental and social guidelines. However, Hadfield-Hill
added: "If Indian banks are to penetrate western markets and
participate more in the global economy, it is important that
they recognise their responsibilities as global corporate
citizens.
"Banks in India have significant influence over the
safeguarding of fragile social groups and environments
in Asia. At this time they must seriously consider their
attitudes towards responsible lending both nationally and
globally," she said.