Brokerage firm pushes for socially responsible lenders
Central Coast-based finance brokerage advocates for the promotion of corporate social responsibility (CSR) by giving borrowers the opportunity to obtain finance from customer-owned and socially responsible lenders.
Astute Ability Finance Group principal and founder Mhairi MacLeod has long advocated for the greater emphasis on CSR across the financial services sector.
According to her, this is one of the best ways to stay in touch with the estimated 4.5 million Australians born between 1995 and 2009, or the so-called generation Z who align themselves with businesses that support sustainability efforts such as environmental preservation and gender diversity.
“Generation Z cares deeply about sustainability, society and preserving the planet, and will certainly think twice about taking a cheap deal if the company behind it still dumps its plastic into the ocean,” Ms MacLeod said.
“As a brokerage with CSR at its heart and soul, all our new mortgage customers will be asked whether a mortgage solution from a socially responsible bank is important to them and if so, we will find options that match their own values.”
In line with the advocacy to promote socially responsible lenders, Bank Australia and Teachers Mutual Bank Ltd have launched mortgage and deposit products that are certified responsible investment by the Responsible Investment Association Australasia (RIAA), the peak industry body representing responsible, ethical and impact investors across Australia and New Zealand.
Currently, RIAA boasts over 240 members who manage more than $9 trillion in assets globally.
According to Ms MacLeod, Bank Australia invests 4.0 per cent of its after-tax profits in projects with a positive social and environmental impact and mitigates the social and environmental impacts of its operations.
“The bank also screens potential loans and investments for negative social and environmental effects, for example, excluding loans to the fossil fuel industry,” she said.
Further, Teachers Mutual Bank operates under distinctive socially responsible strategies, standards and practices, and these apply to all its products, primarily their mortgages and deposits. Therefore, the money that can be borrowed for mortgage does not come from damaging industries.
Teachers Mutual Bank also has specific social responsibility exclusion criteria in relation to the provision of credit and they apply strict social responsibility criteria when it comes to investing and lending their members’ money.
Ms MacLeod said other banks were on the CSR bandwagon as well, with ME Bank refusing to invest in fossil fuels, coal mining, coal ports, coal power, gas power, arms trade, tobacco or liquid natural gas plants.
“The financial services industry needs to address the shifting landscape, especially in light of the Hayne royal commission, and to embrace corporate social responsibility in order to ensure its future,” she concluded.
“Everyone right now finds themselves needing to be more responsible. The results of the royal commission mean we’re first and foremost looking for good customer outcomes, and we have to start looking at corporate social responsibility on all levels.”
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