Guest blog: Mutuality can lead the way on green finance

Guest blog by Alison Vipond, Sustainability Policy and Innovation Lead at Ecology Building Society

Guest blog by Alison Vipond, Sustainability Policy and Innovation Lead at Ecology Building Society, 

This article was first published in Society Matters magazine.

In 2021, research funded by the WWF reported an ‘eco-awakening’ around the world. A growing number of people are concerned about nature and demanding action to protect the planet. That awakening must urgently translate into a rapid transition to a low carbon economy, powered by green finance. Building societies, as mutuals grounded in communities, are well positioned to champion fairness and co-operation at the heart of transition.

When Ecology was created, our founders were motivated by concerns over environmental degradation. Now climate change, ecological collapse, deepening social inequalities, a global pandemic and conflict are the defining issues of our time. Our values of fairness, responsibility, co-operation and activism have never seemed more relevant.

Our ecological mission, to support sustainable homes and communities, provides us with great clarity, as well as resonating with our growing community of members, colleagues and partners. All our lending seeks to create environmental and social benefits such as improving the energy efficiency of a property, bringing under-utilised buildings back into use, and creating community-led housing, including housing co-ops and other forms of mutual home ownership. Our C-Change mortgages incentivise energy efficiency through our mortgage pricing.

Our mission also guides how we use our influence to catalyse positive change in the financial system. For example, we’re founding signatories to the UNEP Finance Initiative - Principles for Responsible Banking and Net Zero Banking Alliance. By joining these initiatives, we hold ourselves to account, but we’re also creating momentum for other banking providers to join. We also co-chair the UK group of PCAF, the Partnership for Carbon Accounting Financials, helping to build capacity to measure the carbon footprint of residential property.

Ecology’s members are knowledgeable and passionate – they tell us to be bold. During 2021, we co-developed our 2030 strategy with our members, colleagues, board and key partners. We used the ‘Theory of Change’ approach, which is commonly used by purpose-led organisations. First, we shaped the vision of the future we want and from there, identified priority areas for positive change. Through our consultation, our members provided richly valuable insights and ideas to shape the strategy. An online member event provided the opportunity to share the strategy and the thinking behind it with members and wider stakeholders, enabling us to hear direct feedback and stay accountable.

Although we have been fully dedicated to our ecological mission for more than forty years, we still have a lot to do. The pursuit of sustainability is a journey. We’re currently working on developing net zero transition plans for both our operations and our lending, grappling with some big issues, not least that we do not operate in a vacuum, but are dependent on the economy, policy, energy and transport infrastructure, supply chains, human behaviour and innovation.

We continue to call for a National Retrofit Strategy as an infrastructure priority. The UK has the ‘leakiest’ homes in Europe, wasting heat and exposing us to rising fuel bills. We believe building societies are well-placed to enable large-scale retrofit to transform the UK housing stock, a mission that all our members will applaud.

On a final note, we encourage fellow building societies to join PCAF and UNEP FI Principles for Responsible Banking. Together we can create unstoppable momentum in the development of green finance in the UK, accelerating the journey to net zero.

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The views, opinions and positions expressed within guest blogs are those of the authors and do not necessarily represent those of the BSA.