Saving money while saving the planet First CO
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Saving money while saving the planet? First CO 2 & SRI labeling scheme for savings products • Pierre Dutrieu Pierre. DUTRIEU@bpce. fr • Yann Louvel, Private Finance campaigner, Friends of the Earth France yann. louvel@amisdelaterre. org Confidentiel © 2008 Utopies
Context: increasing pressure on banks Before the project (in june 2007) • Climate change: studies from FOE estimate that induced carbon emissions represent 1000 times direct emissions • NGOs and media consider that banks’ marketing approach prevent SRI from mainstreaming • Some retailers commit to apply a carbon label on their products • Most banks are strongly criticized for hiding the risks related to some savings and credit products Since the public launch (mid 2008) • Carbon labeling of consumer goods become mandatory in France, a carbon tax will be introduced in 2010 • The financial crisis spotlighted the socio-economic impact of banks, the lack of traceability of savings products and the systemic risks related to irresponsible loans (subprime loans)
The origin of the project • • Caisse d’Epargne is the 4 th French retail bank with a net income of € 10 Bn Commitment in June 2007 to label all the savings products by mid 2008 Labelling scheme designed by Caisse d'Epargne and Utopies in collaboration with a stakeholder panel Open source methodology: q Accessible to everybody on our website q Every Bank is free to implement it q All banks will be invited to take part to a multi-stakeholders initiative to improve the methodology Example: Are your savings… Safe for you? No financial risk for you with this product, the annual interest rate is warranted. Responsible? A Socially Responsible Investment approach is applied but the impact on the asset management process is limited. Low-Carbon? Your money is invested in French Government bonds and low carbon intensity industries: 220 g of CO 2 per € of savings Short label on each product leaflet Detailed fact sheet on each product on the website Source: Caisse d'Epargne/ Utopies The Caisse d’Epargne commits to label all their savings products
Evolution of the project From best practice to emerging industry standard Project open to every bank and insurer Scheme and methodology co-designed with a stakeholder panel Open Source 2 insurers join the project. 5 other companies showed interest The companies and the panel formed the Association for Transparency and labeling of financial products Several national standards will be based on our methodology FOE lobbies for mandatory requirements in France & Europe Workshop with CSR Europe to extend the project
Carbon footprint of savings product How does it work? The core principle is: If you finance 10% of an activity or organization, 10% of its annual CO 2 emissions are attributed to you CO 2 This principle is derived from the GHG protocol’s equity share principle Investor indirect emissions Supply chain emissions Direct emissions CO 2 Products emissions All GHG protocol scopes are taken into account
Carbon footprint of savings product How does it work? data provided by: All type of securities taken into account CO 2 Corporate shares CO 2 Bank Risque Customer Ethique Corporate bonds CO 2 Climate Government bonds
Overview of the results Comparing securities (application to portfolios) Tonnes of CO 2 induced per year per 1 M€ of holdings 1 to 200 data provided by:
Overview of the results Comparing products (application to savings products) Tonnes of CO 2 induced per year per 1 M€ of of holdings € 10. 000 invested = 1 vehicle on the road
Downloads www. utopies. com/bank-label gy o l Ful hodol t me on the t r o p Re tprint o o f n carbo FO an E rep di ns orts ure on rs ba n ks