Banks v the banks as call grows for ethical investments

Published on 29/11/2009 22:44

SCOTS author Iain Banks has joined MPs and church leaders in accusing the government of failing to push banks to adopt ethical investments.

In a letter to the Chancellor, the group said the Treasury had not used influence gained through last year's government bail-out to force Royal Bank of Scotland to support such investments.

The Treasury was not immediately available for comment.

RBS said sustainability was "something we strive towards".

The letter said: "We believe that the Treasury is failing to push the recapitalised banks towards supporting the investments our country needs, and ignoring how the banks are choosing to spend public money…

"The government has effectively written a blank cheque with taxpayers' money to the banks to finance anything from destructive fossil fuel companies driving climate change, to hostile take-overs that threaten UK jobs."

The group is angry that RBS continues to finance loans to oil and gas companies. The "hostile takeovers" refers to reports that RBS supports US food giant Kraft's bid for British firm Cadbury.

The group also called on the government to reshape RBS into a "Royal Bank of Sustainability".

Mr Banks is one of 40 members of the group, led by campaign body the World Development Movement. Others signatories include the Labour MP Alan Simpson; the Rev Ian Galloway, convener of the Church of Scotland's Church and Society Council; Gordon Roddick, co-founder of the Body Shop with his late wife Dame Anita Roddick, and union boss Billy Hayes.

RBS said: "We have been a leading arranger of finance to the renewable energy sector. We only provide finance to projects which meet the environmental and social standards specified by the Equator Principles."

The Equator Principles are a voluntary initiative for financial institutions that define environmental and social guidelines for project financing.