ING and Sustainable Banking - Investing in the Green Future
Today we are back with a leader of the transition: ING. It was rated #7 most sustainable business of 2020 by Forbes and for good reasons. Indeed, their approach to sustainability goes beyond reducing their carbon footprint; it also aims at making a more conscious investment towards sustainable and green technologies. By funding innovation of sustainable solutions, ING is both betting on a green future and is allowing companies to get the necessary resources to develop.
Mobilising capital for investment in the SDGs is a considerable challenge for every country. The public funds, especially in the context of post COVID recovery, will undoubtedly be spent on social investments, unemployment insurance and social security. "Each nation-state or country has the primary responsibility for financial resources mobilisation and capacity building. There will be global financing for development agenda."  The new SDG 2030 agenda will surely shake the current relations between private and public investments towards sustainable businesses.
Indeed, reaching for SDGs should not only a public responsibility. Private funding is critical in furthering the advance of most SDGs if given the right push by public policies. Therefore, conscious and sustainable investments and especially banking are critical players to achieve the 2030 agenda "FDI increases the probability of better trends in the following SDGs: poverty; Affordable and clean energy; Industry, innovation, and infrastructure; Life below water and peace, Justice and strong institutions." 
In this context, ING is imposing standards for sustainable investments by offering adapted loans to sustainable companies and projects. To make it simple, ING offers subsidies to ameliorate companies' sustainability performances by directly linking them to the interest rates. External partners are assessing a company's sustainability score. The more the score goes up, the lower the interest rates. This system seems very simple, but it nevertheless acts as a great incentive to implement corporate sustainability standards.
By favouring projects related to the environment, ING is mainly supporting the scaling up of the economy and contributing to a real green economy. One might say that ING is a bank and not a charity; the primary objective of banks is to make more money. To achieve this goal, all sustainable businesses benefiting from the loans will get the resources for thriving, as they say, "we believe that companies addressing climate change and resource scarcity will be the winners of tomorrow's economy".
Further, for all defenders of the environment and the economists reading this article, when banks are starting to invest it is usually a good sign, "banks are significant to the growth and survival of any socio-economic system". Essentially, ING is slowly making sustainability more competitive and lucrative. Doing so will undoubtedly attract more companies towards this line of business. Fundamental economic theories would suggest that the natural outcome of this market expansion will be a price reduction and a more extensive demand for sustainable solutions.
Therefore, ING is supporting business in developing more sustainable business models by targeting three pillars of environmental sustainability, namely, circular economy, energy transition and water management. It seems logical, but I want to make it clear; ING is not a saint company obviously, although it does allow entrepreneurs with streamlined projects or innovative concepts to scale up and have a real impact. Indeed, both in matters of finance and environment, a good project will have a higher income stream and a more substantial impact if it is bigger, better, faster and stronger.
These new types of investment will be supporting small companies and start-ups. Indeed, the green loans and the green bonds offered by national and big banks are only accessible by multinationals and very high-profit companies. Supporting SMEs and start-up is what will properly scale up sustainable European economy and fast-track corporate sustainability, which are both essential goals to reach to diminish total European carbon emissions adequately.
Further, ING is not only subsidising sustainable project, but it is also declining to investments and subsidies to project with a negative impact. Indeed, behind the money-making banking institution, there still is a real commitment to choose sustainability first. "Every client and transaction is assessed, monitored and evaluated against the requirements of our Environmental and Social Risk (ESR) framework to ensure compliance and limit the negative impact on the environment and communities. We also say 'no' to individual companies and sectors, like with our aim to reduce our exposure to coal power generation to close to zero by 2025."  This demonstrates that the investment is not only a greenwashing façade but that the commitment is deeply rooted in the company's corporate guidelines.
As we explored in our latest article, the field of the circular economy still needs to be scaled up to have a real beneficial impact both economically and environmentally. Such initiatives deserve to be adequately funded. If more banks were following this trend and were shifting their funds from coal to circular economy, there could be a real, meaningful shift in our economy and a proper impact. Hopefully, they will soon realise that and we will all be set for a greener better future!
Stay safe, live well, live green!
 Aust, V., Morais, A. I., & Pinto, I. (2019). How does foreign direct investment contribute to Sustainable Development Goals? Evidence from African countries.
 Jayasooria, D. (2016). Sustainable Development Goals and Social Work: Opportunities and Challenges for Social Work Practice in Malaysia.
 Idowu, S. O., Schmidpeter, R., & Zu, L. (Eds.). (2020). The Future of the UN Sustainable Development Goals. CSR, Sustainability, Ethics & Governance.
1. Aust, V., Morais, A. I., & Pinto, I. (2019). How does foreign direct investment contribute to Sustainable Development Goals? Evidence from African countries. Journal of Cleaner Production, 118823. doi:10.1016/j.jclepro.2019.118823
2. Idowu, S. O., Schmidpeter, R., & Zu, L. (Eds.). (2020). The Future of the UN Sustainable Development Goals. CSR, Sustainability, Ethics & Governance. doi:10.1007/978-3-030-21154-7
3. Jayasooria, D. (2016). Sustainable Development Goals and Social Work: Opportunities and Challenges for Social Work Practice in Malaysia.