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The Humanitarian Side of Everything: Banking

Welcome to "The Humanitarian Side of Everything: Creating Positive Impact in Your Daily Life" on Listenable! This is Lesson Ten, and I'm your host Alexa.

In this course, we've talked quite a bit about how our actions impact the environment, from our carbon footprints to the clothes we wear to what we eat. Perhaps the most surprising way that we affect the environment is through our bank accounts.

That's right, how you invest and save your money can have a profound impact on the environment. But it's a little more complicated than whether you use Bank of America or Wells Fargo.

"Climate finance" refers to money – both from public and private sources – which is used to help reduce emissions and increase resilience against the negative impacts of climate change. The truth is that fighting climate change requires a lot of money going to the right places. It also requires less money going to gas companies.

In Lesson Two, I mentioned that 100 companies are to blame for 71% of all industrial emissions. This is a staggering fact – and part of what makes this fact so central to the climate discussion is the enormous power that these corporations have. This power is in part derived from the capital they have to finance their operations. Money and climate destruction are linked. It's major companies that are contributing to deforestation and carbon emissions – and they do so with the backing of major investors and large banks.

It's unlikely that you directly own stock in BP or another oil giant. You might even own mutual funds that are deemed sustainable or are ESGs. ESG is environmental, social and corporate governance – factors used to measure the sustainability of an investment.

The truth is that many major banks continue to finance the companies that are hurting the environment the most. As customers, we can be aware of the actions of our banks and we can choose to invest in companies and make other investments that commit to protect the environment.

If you invest your money, be sure to know the companies that you are supporting. Look at their environmental impact, how they treat their employees, and their overall business practices.

In eighth lesson, we talked about B Corps – a type of social enterprise that meets specific standards of social and environmental performance, public transparency, and legal accountability all to ultimately balance profit and purpose. There are actually banks that are certified B Corporations. These banks have met the B Corp standards for corporate responsibility, meaning that they meet environmental standards and are transparent in their business practices.

By being careful about where you bank and invest, you can quite literally put your money where your mouth is. The money that you save and invest can positively impact the environment and people. You'll be directly financing a better future for everyone.

In this lesson, we learned about how finance is connected to humanitarianism. The connection between money and humanitarian issues goes beyond just how you spend your money. It extends to how you save and invest your money. Take some time to evaluate how you're using, saving and investing your money, and the potential impacts that has.

In our next lesson, we'll discuss the connection between personal and institutional responsibility.

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Written by

Alexa Bussmann