Banks have contributed to much of the world’s emissions. This is no longer conjecture or opinion, but an objective and increasingly documented fact. Loans from banks have enabled most of the world’s largest companies to build their empires, ballooning their own puddles of Scope 3 emissions into vast seas. Local banks and credit unions are equally culpable at much smaller scales. However, despite their undeniable role, banks are not to blame and aren’t the bad guys some make them out to be.

Banks generally follow economic signals. Perhaps with some exceptions, banks don’t create cars and gasoline, produce jet fuel, pave over parks or build skyscrapers. Banks help fund companies that supply products to meet our demand.

Micro plastics are found in the deepest parts of our oceans because we collectively demand the convenience of goods served in cheap, malleable single serving plastics. The emissions from cars, power plants and cattle farms pollute our air because we demand the conveniences and luxuries those things allow for. Banks help fund the construction of mansions and shopping malls because that’s how we’ve signaled we prefer to live and to shop.

It's true that banks and companies do not sufficiently incorporate environmental costs in credit and business decisions, but neither do most of us when it comes to our own individual choices.

And just as we need to be forgiving to banks and companies, we should also be forgiving to ourselves. Our collective understanding of the economic models deployed across the world are evolving rapidly. As a society, we know more than we used to, and as a society, we need to elevate those learnings to inform and transform new models that can be used to realize a healthy and thriving economy and planet.

Time is of the essence, of course. As dire as the predictive models of global warming are, most of us still lack a thorough understanding of sustainability. Lenders and companies need to adapt their business and credit decisions to incorporate true environmental costs, and we need to understand the impact of our individual choices so that the right market signals are sent rippling through the economy. Resources are available to support this transformation.

Regulation is a necessary catalyst to get us to where we need to go, but regulation does not replace the need for all of us to be informed and responsible global citizens.

From the top down, and from the bottom up, banks and companies – and more specifically, the people at those banks and companies – can adapt to meet the challenges of today. We will need to support each other with empathy and pragmatism, and just as generations of our decisions have gotten us here, swift and purposeful action can lead us to a clean, fair and transformed economy for all.

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