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1.0 Introduction
Green Banking is a component of the global initiative by a group of stakeholders to save environment. Bangladesh is one of the most climate change vulnerable countries. In line with global development and response to the environmental degradation, financial sector in Bangladesh should play an important role as one of the key stakeholders. Bangladesh Bank is well aware of the environmental degradation situation as mentioned and has already given time to time directions to all schedule banks. Commercial banks are now required to ensure necessary measures to protect environmental pollution while financing a new project or providing working capital to the existing enterprises. Normally we can consider the banks as environment friendly with their operational activities but it is important that the environment can be effected greatly by the activities of their customers. The banking sector is one of the major sources of financing industrial projects such as Brick field, Steel, Paper, Cement Chemicals Fertilizer, Power, Textiles etc. which cause maximum carbon emission.

Therefore, the banking sector can play intermediary role between economic development and environment protection, for promoting environmentally sustainable and social responsible investment. Green Banking refers to the banking business conducted in such areas and in such a manner that helps the overall reduction of external carbon emission and internal carbon footprint. To aid the reduction of external carbon emission, bank should finance green technology and pollution reducing projects. Internally the banking operations have considerably increased the carbon footprint of banks due to their massive use of energy e.g. lighting, air conditioning, electronic or electrical equipments, IT, high paper wastage, lack of green buildings etc. Therefore, to adopting green banking, bank should adopt technology, process, and products which result in substantial reduction of their carbon footprint as well as develop sustainable business. 2.0 Executive Summary

We are aware that global warming is an issue that calls for a global response. The rapid change in climate will be too great to allow many eco-systems to suitably adapt, since the change have direct impact on biodiversity, agriculture, forestry, dry land, water resources and human health. Due to unusual weather pattern, rising greenhouse gas, declining air quality etc. society demands that business also take responsibility in safeguarding the planet. Green finance as a part of Green Banking makes great contribution to the transition to resource-efficient and low carbon industries i.e. green industry and green economy in general. Green banking is a component of the global initiative by a group of stakeholders to save environment. The state of environment in Bangladesh is rapidly deteriorating. The key areas of environmental degradation cover air pollution, water pollution and scarcity, encroachment of rivers, improper disposal of industrial medical and house-hold waste, deforestation, loss of open space and loss of biodiversity. In addition, Bangladesh is one of the most climate change vulnerable countries. In line with global development and response to the environmental degradation, financial sector in Bangladesh should play important roles as one of the key stake holders.

In response to the above, urgent measures are required by stake holders for sustainable development and thereby save the planet. Banks hold a unique position in an economic system that can affect production, business and other economic activities through their financing activities and thus may contribute to pollute environment. Moreover, energy and water efficiency and waste reduction are of high concern for many big banks. Green banks or environmentally responsible banks do not only improve their own standards but also affect socially responsible behavior of other business. In regarding to this fact, this study found out the contribution of the state owned commercial banks (SCBs) to the development of green banking sectors. 3.0 Green banking

The term “green banking” generally refers to banking practices that foster environmentally responsible financing practices and environmentally sustainable internal processes minimizing GHG emissions. Green banking thus involves a two pronged approach. Firstly, green banking focuses on the green transformation of internal operations of all banks. It means all the banks should adopt appropriate ways of utilizing renewable energy, automation and other measures to minimize carbon footprint from banking activities. Secondly, all banks should adopt environmentally responsible financing; weighing up environmental risks of projects before making financing decisions; and in particular supporting and fostering growth of upcoming ‘green’ initiatives and projects. 3.1 In-House Green Activities Include

* Reduce dependency on grid power by shifting to use of solar power and other renewable energy sources to the maximum feasible extent * Follow green architecture while constructing bank offices * Use energy saving technologies such as LED, CFL etc.

* Use energy efficient digital devices
* Reduce use of paper by adoption of online automated work practices * Conduct energy audit regularly to monitor carbon footprint 3.2 Green activities in financing include
* Carry out environmental risk assessment of projects, financing only those that meet environmental safeguards/sustainability guidelines * Provide green loan to promote solar energy, biogas plants, effluent treatment plants and energy saving output practices like Hybrid Hoffman Kilns in brick fields * Develop green banking products for clients

* Promote growth of mobile banking and online banking
* Include environmental sustainability support initiatives in corporate social responsibility (CSR) programs, inter alia including financial support to climate risk fund 4.0 Green Banking In Bangladesh

Bangladesh is identified by climate change experts as being among the countries more severely challenged by climate change threat; with correspondingly high urgency of preparedness with mitigate and adaptive responses. The government and Bangladesh have remained fully aware and proactive in this respect, using the country’s own meager resources besides whatever modest support is being provided by the international community. Recognizing that the financial sectors can play a catalytic role in speeding up adoption of environmentally friendlier output practices in the real economy; Bangladesh bank has launched in 2011 a comprehensive green banking initiative to support and promote environmentally responsible financing; issuing guidance inter alia for environmental risk assessment of borrowing proposals and for greening of internal processes and practices within banks. 4.1 Earlier Initiatives for Green Banking

BB is well aware of the environmental degradation situation as mentioned above and has already given time to time directions to all scheduled banks. Commercial Banks are now required to ensure necessary measures to protect environmental pollution while financing a new project or providing working capital to the existing enterprises. Banks have been advised to facilitate their clients with utmost care in opening Letter of Credit (L/C) for installation of Effluent Treatment Plant (ETP) in the industrial units. Banks have been advised to finance in Solar Energy, Bio-gas, ETP and Hybrid Hoffman Kiln (HHK) in brick field under refinance program of BB. A comprehensive guideline on Corporate Social Responsibility (CSR) has been issued where banks have been asked to concentrate hard on linking CSR at their highest corporate level for ingraining environmentally and socially responsible practices and engaging with borrowers in scrutiny of the environmental and social impacts.

Banks have been brought under the purview of E-commerce with a view to providing the customers with online-banking facilities covering payments of utility bills, money transfer and transactions in local currency through internet as well. Considering the adverse effects of Climate Change, banks have been advised to be cautious about the adverse impact of natural calamities and encourage the farmers to cultivate salinity resistant crops in the salty areas, water resistant crops in the water locked and flood prone areas, drought resistant crops in the drought prone areas, using surface water instead of underground water for irrigation and also using organic fertilizer, insecticides by natural means instead of using chemical fertilizer and pesticides. 4.2 Adopting Green Banking Policy

Now it is the high time for the banks to adopt a comprehensive Green Banking Policy in a formal and structured manner in line with global norms so as to protect environmental degradation and ensure sustainable banking practices. With a view to developing green banking practices in the country, an indicative Green Banking Policy and Strategy framework has been developed for the banks in the following manner: Green Banking Policy needs to be covered through time frame work which will be segregated into 3 phases.

Phase-I
Banks are to develop green banking policies and show general commitment on environment through in-house performance. The time lining for the actions to be taken under Phase-I should not exceed December 31, 2011. 4.2.1 Policy Formulation and Governance

Bank shall formulate and adopt broad environmental or Green Banking policy and strategy approved by their Board of Directors. A high powered Committee comprises of directors from the Board in case of scheduled Bangladeshi Banks and a high powered committee comprises Regional Chief of Global Office and members from the top management including CEO in case of Foreign Banks should be responsible for reviewing the banks environmental policies, strategies and program. Bank shall approve a considerable fund in their annual budget allocation for green banking. Banks are required to establish a separate Green Banking Unit or Cell having the responsibility of designing, evaluating and administering related green banking issues of the bank. A senior executive should be assigned with the responsibility of heading the unit. The unit will report to the high powered committee time to time. 4.2.2 Incorporation of Environmental Risk in CRM

Banks shall comply with the instructions stipulated in the detailed guidelines on Environmental Risk Management (ERM) in consideration of a part of the Green Banking Policy. Bank shall incorporate Environmental and Climate Change Risk as part of the existing credit risk methodology prescribed to assess a prospective borrower. This will include integrating environmental risks in the checklists, audit guidelines and reporting formats. All of this will help mainstream Environmental Risk that cover possible sources of Environmental Risk such as Land use, Climate change related events (cyclone, drought), animal diseases/pathogens such as avian influenza, solid waste including waste feed, animal waste, carcasses, sediments, wastewater discharges, hazardous materials, etc will be reviewed under Environmental Due Diligence (EDD) checklists. 4.2.3 Initiating In-house Environment Management

Banks shall prepare an inventory of the consumption of water, paper, electricity, energy etc. by its offices and branches in different places. Then it should take measures to save electricity, water and paper consumption. A ‘Green Office Guide’ or at least a set of general instructions should be circulated to the employees for efficient use of electricity, water, paper and reuse of equipments. In place of relying on printed documents, online communication should be extensively used (where possible) for office management and make sure that the printers are defaulted to duplex for double-side printing to save papers. Banks may apply Ecofont in printing to reduce use of ink, use scrap paper as notepads and avoid disposable cups/glasses to become more eco- friendly.

Installation of energy efficient electronic equipments and automatic shutdown of computers, fans, lights, air coolers etc. will help reducing electricity consumption. Energy saving bulbs should replace normal bulbs in branches/offices of the banks. Banks should make plan to use solar energy at their premises to save electricity. Bank should take steps to save energy from corporate business travel and encourage employees to purchase energy efficient cars (that consume less fuel) can reduce gas and petroleum consumption. 4.2.4 Introducing Green finance

Eco friendly business activities and energy efficient industries will be given preference in financing by bank. Environmental infrastructure such as renewable energy project, clean water supply project, wastewater treatment plant, solid & hazardous waste disposal plant, bio-gas plant, bio-fertilizer plant should be encouraged and financed by bank. Consumer loan programs may be applied for promoting environmental practices among clients. 4.2.5 Creation of Climate Risk Fund

Bank should finance the economic activities of the flood, cyclone and drought prone areas at the regular interest rate without charging additional risk premium. However, banks should assess their environmental risks for financing the sectors in different areas for creating a Climate Change Risk Fund. This will be used in case of emergency. The bank would ensure regular financing flows in these vulnerable areas and sectors. The fund could be created as part of banks’ CSR expenses. 4.2.6 Introducing Green Marketing

Green marketing is the marketing of products that are presumed to be environmentally safe. Green marketing incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising. It refers to the process of selling products and/or services based on their environmental benefits. Such a product or service may be environmentally friendly in it or produced and/or packaged in an environmentally friendly way. Banks should use environmental causes for marketing their services to consumer. Green marketing is expected to help awareness development among common people. 4.2.7 Online Banking

Online banking is the practice of making bank transactions or paying bills via the Internet on a secure website of the respective bank that allows the customers to make deposits, withdrawals and pay bills. Banks should give more emphasis to make the easiest way to help environment by eliminating paper waste, saving gas and carbon emission, reducing printing costs and postage expenses. 4.2.8 Supporting Employee Training, Consumer Awareness and Green Event Employee awareness development and training on environmental and social risk and the relevant issues should be a continuous process as part of the bank’s Human Recourse Development. Awareness development among consumers and clients would be a continuous job of a bank under its public relation department. 4.2.9 Disclosure and Reporting of Green Banking Activities

Banks shall report on the initiatives/practices to BB and disclose in their respective websites. Phase-II
The time lining for the actions to be taken under Phase-II should not exceed December 31, 2012. 4.2.10 Sector Specific Environmental Policies Banks need to formulate strategies to design specific policies for different environmental sensitive sectors such as Agriculture, Agri-business (Poultry & Dairy), Agro farming, Leather(Tannery), Fisheries, Textile and Apparels, Renewable Energy, Pulp and Paper, Sugar and distilleries, Construction and Housing, Engineering and Basic Metal, Chemicals (Fertilizers, Pesticides and Pharmaceuticals), Rubber and Plastic Industry, Hospital/Clinic, Chemical Trading, Brick Manufacturing, Ship breaking etc.

4.2.11 Green Strategic Planning
A bank should determine green targets to be attained through strategic planning. Bank should determine a set of achievable targets and strategies, and disclose these in their annual reports and websites for green financing and in-house environment management as well. For in-house environment management, the target areas should cover attaining energy efficiency in the form of the use of renewable energy, reduction of electricity, gas, and petrol consumption, reduction of Green House Gas(GHG) emissions, issuance of e-statements, electronic bill pay, saving papers, environment friendly office buildings etc. For Green Financing, the target areas should cover reducing loans for certain environmentally harmful activities, attaining a particular percentage of environmental loans as percentage of total, introducing eco-friendly financial products etc. 4.2.12 Setting up Green Branches

A Green Branch should be featured by the provision of the maximum use of natural light, use of renewable energy, use of energy saving bulbs and other equipments, reduced water and electricity use, use of recycled water etc. Such a branch of a bank would be specifically designated as a ‘Green Branch’. A Green Branch will be entitled to display a special logo approved by Bangladesh Bank. The criteria for certification of a ‘Green Branch’ will be circulated by Bangladesh Bank in due course of time. 4.2.13 Improved In-house Environment Management

Strategy of reuse, recycling of materials and equipments, and source reduction and waste minimization strategy should be part of in-house environmental management in Phase-II. Banks should increasingly rely on virtual meeting through the use of video conferencing in lieu of physical travel which would help saving cost and energy. 4.2.14 Formulation of Bank Specific Environmental Risk Management Plan and Guidelines A bank should develop and follow an environmental risk management manual or guidelines in their assessment and monitoring of project and working capital loans. In addition to the compliance of national regulation the bank may set internationally accepted higher environmental standards. In this connection, Green initiatives by a group of banks will not only be effective but will also offer competitive advantage. Bank alliances may prepare standard and guidelines for themselves for improving Green Banking practices. 4.2.15 Rigorous Programs to Educate Clients

Clients and business houses should be encouraged and influenced to comply with the environmental regulations and undertake resource efficient and environmental activities. Banks should introduce rigorous programs to educate clients. 4.2.16 Disclosure and Reporting of Green Banking Activities

Banks should start publishing independent Green Banking and Sustainability reports showing past performances, current activities, and future initiatives. Updated and detailed information about banks environmental activities and performances of major clients should be disclosed. 3. Phase-III:

A system of Environmental Management should be in place in a bank before the initiation of the activities of Phase-III. Banks are expected to address the whole eco-system through environment friendly initiatives and introducing innovative products. Standard environmental reporting with external verification should be part of the phase. The time lining for the actions to be taken under Phase-III should not exceed December 31, 2013. 4.2.17 Designing and Introducing Innovative Products

Alongside avoiding negative impacts on environment through banking activities, banks are expected to introduce environment friendly innovative green products to address the core environmental challenges of the country. 4.2.18 Reporting in Standard Format with External Verification Banks should publish independent Green Annual Report following internationally accepted format like Global Reporting Initiatives (GRI) targeting their stakeholders. There should be arrangement for verification of these publications by an independent agency or acceptable third party. 4.2.19 Reporting Green Banking Practices on Quarterly Basis

Banks shall report their initiatives/activities under the said program to the Department of Off-site Supervision of Bangladesh Bank on quarterly basis. Banks shall submit their first quarterly report on June 30, 2011 basis within July 15, 2011 and similarly they will be required to continue to submit reports on the subsequent quarters within the next 15 days of the respective quarter end. Banks shall keep their annual report and websites updated with the disclosures on green banking initiatives/activities. 4.2.20 The compliant banks practicing Green Banking will have the following preferential treatments: 1. BB will award points to banks on Management component while computing CAMELS rating where there will ultimately be a positive impact on overall rating of a bank. 2. BB will declare the names of the Top Ten Banks for their overall performance in green banking activities in the BB websites. 3. BB will actively consider green banking activities/practices of a bank while according permission for opening new bank branch. 4.3 Bank’s Green Banking Activities Based on Green Banking Policy * Policy Formulation & Implementation

* Budget Allocation & Utilization
* Green Banking Unit Formation
* Environmental Risk Rating
* Green Financing
* Climate Risk Fund Utilization
* Green Marketing and Capacity Building
* Online Banking
* In-house Environment Management
* Sector Specific Environmental Policy
* Green Strategic Planning
* Environmental Risk Management Plan
* Disclosure and Reporting

4.4 Major Green Banking Activities at a Glance
* 45 banks have formulated policy for green banking
* 46 banks have formed a green banking unit
* 41 banks have introduced a green office guide
* EnvRR has been done for 13779 projects
* EnvRR has been done for 2926 projects
* 13833 rated projects have been financed
* 3069 rated projects have been financed

* 1307479.64 million taka has been disbursed
* 513419.39 million taka has been disbursed
* 212 branches and 150 SME unit / ATM are powered by solar energy
* 37 banks are fully automated
* 3226 branches have been facilitated with online coverage
* 8 banks have utilized taka 9.74 million from climate change risk fund (during July-September, 2012)
* Banks have financed taka 3273.69 million as green finance other than projects having ETP (during January- September, 2012)
* At least two banks have created two trust funds for rewarding individuals and corporate for their outstanding contributions toward raising consciousness and addressing issues related to climate change

5.0 Methodology

Green banking policy indicates some major green banking activities by which the role of a Bank in green banking can be measured. So, this study used the major green banking activities for measuring the role of the state-owned commercial banks SCBs- Sonali Bank Limited, Janata Bank Limited, Agroni Bank Limited and Rupali Bank Limited to establish the green banking sectors. 6.0 SCBs Performance in Green Project Implementation

The state-owned commercial banks lagged behind other banks in implementing green project, the BB Green Banking Report said. None of the state-owned commercial banks could achieve a place among the top ten banks in green banking rating by the central bank in the first quarter of the 2012. The central bank published the green banking report for the first time last week and recognized the top ten private commercial banks for significant contributions to green banking. According to the BB report, the SCBs lagged behind the expected level for financing in the environment-friendly projects to ensure the country’s sustainable development. There is no one of SCBs in top bank list of green banking performance. The top ten Banks are-Bank Asia, Dutch-Bangla Bank, Eastern Bank, Islami Bank Bangladesh, Mutual Trust Bank, Prime Bank, Pubali Bank, Standard Chartered Bank, Shahjalal Islami Bank and Trust Bank. The green banking performances of the four state-owned commercial banks are analyzed below one by one: 6.1 Sonali Bank Ltd.

Soon after independence of the country Sonali Bank emerged as the largest and leading Nationalized Commercial Bank by proclamation of the Banks’ Nationalization Order 1972 (Presidential Order-26) liquidating the then National Bank of Pakistan, Premier Bank and Bank of Bhwalpur. As a fully state owned institution, the bank had been discharging its nation-building responsibilities by undertaking government entrusted different socio-economic schemes as well as money market activities of its own volition, covering all spheres of the economy. The bank has been converted to a Public Limited Company with 100% ownership of the government and started functioning as Sonali Bank Limited from November 15 2007 taking over all assets, liabilities and business of Sonali Bank. After corporatization, the management of the bank has been given required autonomy to make the bank competitive & to run its business effectively. 6.1.1 Green Banking Of Sonali Bank Limited

Although Sonali Bank ltd is a largest and leading nationalized commercial bank in Bangladesh, it lagged behind other banks in implementing green project. The following statement has shown how much contribution Sonali Bank Ltd. played in green banking project. Policy Formulation & Implementation: Sonali Bank Ltd. has already formulated green baking policy but in case of implementation it is as long as far. Budget Allocation & Utilization: Sonali Bank Ltd. has also allocated budget Tk. 3120.00 million for green banking project, but it did not utilized its allocated budget for green banking activities. Green Banking Unit Formation: Sonali Bank Ltd. has formulated a green baking unit which is directed by the senior executive Mr. Md. Mustafizur Rahman. Environmental Risk Rating: Environmental Risk Rating has been done for very few projects by Sonali Bank.

It did not finance for any EnvRR project. Green Financing: Sonali Bank Ltd made Tk. 375 million of green financing for Eco friendly business activities and energy efficient industries and Environmental infrastructure such as renewable energy project, clean water supply project, wastewater treatment plant, solid & hazardous waste disposal plant, bio-gas plant, bio-fertilizer plant should be encouraged and financed by bank. But the level of this activities is very much poor. Climate Risk Fund Utilization: Sonali Bank has climate Risk Fund for financing the economic activities of the flood, cyclone and drought prone areas. But the bank does not utilize this fund effectively. Green Marketing and Capacity Building: Sonali Bank made very little budget allocation for green marketing and capacity building. But the Bank does not utilize this budget.

Online Banking: At present 109 branches of Sonali Banks is included in the Online Any Branch Banking (ABB) network. SMS Banking service is running in 73 branches. The bank is seriously working on connecting all branches in the Real-time Online Banking network gradually. Branches having ABB facility are also rendering SMS banking services. In-house Environment Management: Sonali Bank has yet built the in-house environment management. Sector Specific Environmental Policy: There is no sector specific environmental policy in Sonali Bnak. Green Strategic Planning: Sonali Bnak did not make green strategic planning Environmental Risk Management Plan: Sonali Bnak did not make Environmental Risk Management Plan Disclosure and Reporting: No disclosure and reporting

6.2 Janata Bank Ltd
Janata Bank Limited is one of the state owned commercial banks in Bangladesh. It was corporatized on 15th November 2007. Janata Bank was born with a new concept of purposeful banking sub serving the growing and diversified financial needs of planned economic development of the country. Janata Bank Limited operates through 883 branches including 4 overseas branches at United Arab Emirates. It is linked with 1202 foreign correspondents all over the world. The Bank employees are more than 15(fifteen) thousand persons. 6.2.1 Green Banking Of Janata Bank Limited

Although Janata Bank ltd is one of the largest and leading nationalized commercial bank in Bangladesh, it lagged behind other banks in implementing green project. The following statement has shown how much contribution Janata Bank Ltd. played in green banking project. Policy Formulation & Implementation: Janata Bank Ltd. has already formulated green baking policy but in case of implementation it is as long as far. Budget Allocation & Utilization: Janata Bank Ltd. has also allocated budget Tk. 1890.00 million for green banking project, but it did not utilized its allocated budget for green banking activities. Green Banking Unit Formation: Janata Bank has formulated a green baking unit which is directed by the senior executive Mr. Md. Mosharraf Hossain Chowdhury. Environmental Risk Rating: Environmental Risk Rating has been done for very few projects by Janata Bank. It did not finance for any EnvRR project. Green Financing: Janata Bank Ltd made Tk. 187 million of green financing for Eco friendly business activities and energy efficient industries and Environmental infrastructure such as clean water supply project, wastewater treatment plant, bio-gas plant, bio-fertilizer plant should be encouraged and financed by bank. But the level of this activities is very much poor.

Climate Risk Fund Utilization: Janata Bank has climate Risk Fund for financing the economic activities of the flood, cyclone and drought prone areas. But the bank does not utilize this fund effectively. Green Marketing and Capacity Building: Janata Bank made very little budget allocation for green marketing and capacity building. But the Bank does not utilize this budget. Online Banking: At present 42 branches of Janata Banks is included in the Online Any Branch Banking (ABB) network. The bank is seriously working on connecting all branches in the Real-time Online Banking network gradually. Branches having ABB facility are also rendering SMS banking services. In-house Environment Management: Janata Bank has yet built the in-house environment management. Some activities are already taken in hand such as using energy saving bulbs, Video/Audio conference in lieu of physical travel, Conversion of Bank’s vehicles (pool) into CNG and use of energy efficient electronic equipments, e-cheque etc. Sector Specific Environmental Policy: There is no sector specific environmental policy in Janata Bnak. Green Strategic Planning: Janata Bnak did not make green strategic planning Environmental Risk Management Plan: Janata Bnak did not make Environmental Risk Management Plan Disclosure and Reporting: No disclosure and reporting

6.3 Agrani Bank Ltd
Agrani Bank Limited, a leading commercial bank with 879 outlets strategically located in almost all the commercial areas throughout Bangladesh, overseas Exchange Houses and hundreds of overseas Correspondents, came into being as a Public Limited Company on May 17, 2007 with a view to take over the business, assets, liabilities, rights and obligations of the Agrani Bank which emerged as a nationalized commercial bank in 1972 immediately after the emergence of Bangladesh as an independent state. Agrani Bank Limited started functioning as a going concern basis through a Vendors Agreement signed between the ministry of finance, Government of the People’s Republic of Bangladesh on behalf of the former Agrani Bank and the Board of Directors of Agrani Bank Limited on November 15, 2007 with retrospective effect from 01 July, 2007.

6.3.1 Green Banking Of Agrani Bank Limited
Although Agrani Bank ltd is one of the largest and leading nationalized commercial bank in Bangladesh, it lagged behind other banks in implementing green project. The following statement has shown how much contribution Agrani Bank Ltd. played in green banking project. Policy Formulation & Implementation: Agrani Bank Ltd. has already formulated green baking policy but in case of implementation it is as long as far. Budget Allocation & Utilization: Agrani Bank Ltd. has also allocated budget Tk. 1150.00 million for green banking project, but it did not utilized its allocated budget for green banking activities. Green Banking Unit Formation: Agrani Bank has formulated a green baking unit which is directed by the senior executive Mr. Md. Syed Abdul Hmid. Environmental Risk Rating: Environmental Risk Rating has been done for very few projects by Agrani Bank. It did not finance for any EnvRR project.

Green Financing: Agrani Bank Ltd made Tk. 87 million of green financing for Eco friendly business activities and energy efficient industries and Environmental infrastructure such as clean water supply project, wastewater treatment plant, bio-gas plant, bio-fertilizer plant should be encouraged and financed by bank. But the level of this activities is very much poor. Climate Risk Fund Utilization: Agrani Bank has climate Risk Fund for financing the economic activities of the flood, cyclone and drought prone areas. But the bank does not utilize this fund effectively. Green Marketing and Capacity Building: Agrani Bank made very little budget allocation for green marketing and capacity building. But the Bank does not utilize this budget. Online Banking: At present 108 branches of Agrani Banks is included in the Online Any Branch Banking (ABB) network.

The bank is seriously working on connecting all branches in the Real-time Online Banking network gradually. Branches having ABB facility are also rendering SMS banking services. In-house Environment Management: Agrani Bank has yet built the in-house environment management. Some activities are already taken in hand such as using energy saving bulbs, Video/Audio conference in lieu of physical travel, Conversion of Bank’s vehicles (pool) into CNG and use of energy efficient electronic equipments, e-cheque etc. Sector Specific Environmental Policy: There is no sector specific environmental policy in Agrani Bnak. Green Strategic Planning: Agrani Bnak did not make green strategic planning Environmental Risk Management Plan: Agrani Bnak did not make Environmental Risk Management Plan Disclosure and Reporting: No disclosure and reporting

6.4 Rupali Bank Ltd
Rupali Bank Ltd. was constituted with the merger of 3 (three) erstwhile commercial banks i.e. Muslim Commercial Bank Ltd., Australasia Bank Ltd. and Standard Bank Ltd. operated in the then Pakistan on March 26, 1972 under the Bangladesh Banks (Nationalization) Order 1972 (P.O. No. 26 of 1972), with all their assets, benefits, rights, powers, authorities, privileges, liabilities, borrowings and obligations. Rupali Bank worked as a nationalized commercial bank till December13, 1986. Rupali Bank Ltd. emerged as the largest Public Limited Banking Company of the country on December 14, 1986. 6.4.1 Green Banking Of Rupali Bank Limited

Although Rupali Bank ltd is one of nationalized commercial banks in Bangladesh, it lagged behind other banks in implementing green project. The following statement has shown how much contribution Rupali Bank Ltd. played in green banking project. Policy Formulation & Implementation: Rupali Bank Ltd. has already formulated green baking policy but in case of implementation it is as long as far. Budget Allocation & Utilization: Rupali Bank Ltd. has also allocated budget Tk. 780.00 million for green banking project, but it did not utilized its allocated budget for green banking activities. Green Banking Unit Formation: Rupali Bank has formulated a green baking unit which is directed by the senior executive Mr. Md. Syed Abdul Hmid. Environmental Risk Rating: Environmental Risk Rating has been done for very few projects by Rupali Bank.

It did not finance for any EnvRR project. Green Financing: Rupali Bank Ltd made Tk. 187 million of green financing for Eco friendly business activities and energy efficient industries and Environmental infrastructure such as clean water supply project, wastewater treatment plant, bio-gas plant, bio-fertilizer plant should be encouraged and financed by bank. But the level of this activities is very much poor. Climate Risk Fund Utilization: Rupali Bank has climate Risk Fund for financing the economic activities of the flood, cyclone and drought prone areas. But the bank does not utilize this fund effectively. Green Marketing and Capacity Building: Rupali Bank made very little budget allocation for green marketing and capacity building. But the Bank does not utilize this budget. Online Banking: At present 27 branches of Rupali Banks is included in the Online Any Branch Banking (ABB) network.

The bank is seriously working on connecting all branches in the Real-time Online Banking network gradually. Branches having ABB facility are also rendering SMS banking services. In-house Environment Management: Rupali Bank has yet built the in-house environment management. Some activities are already taken in hand such as using energy saving bulbs, Video/Audio conference in lieu of physical travel, Conversion of Bank’s vehicles (pool) into CNG and use of energy efficient electronic equipments, e-cheque etc. Sector Specific Environmental Policy: There is no sector specific environmental policy in Rupali Bank. Green Strategic Planning: Rupali Bnak did not make green strategic planning Environmental Risk Management Plan: Rupali Bnak did not make Environmental Risk Management Plan Disclosure and Reporting: No disclosure and reporting

7.0 Problems Findings
Lack of policy formulation and implementation: Public banks do not take any action to implement the green banking activity properly and still they have no progress to implement the green banking policy proactively. Insufficient budget for green banking: Although public banks are budgeting for green banking but they do not allocate their budget as it should be allocated and utilized. Lack of proper management of green banking unit formation: Though public banks are formed their green banking unit but it is not activated appropriately and there have no proper management for conducting green banking unit. Lack of Environmental Risk Rating: Public banks are not conducted their Environmental Risk Rating for all projects.

They operate their environmental risk rating for very few projects. Inadequate Green financing: The amount of money is financing for Eco friendly business activities and energy efficient industries and environmental infrastructure are not sufficient to conduct green banking activity acutely. Lack of proper Climate Risk Fund Utilization: Public banks made very little budget allocation for green marketing and capacity building. And these are not utilizing in a proper way. Lack of Online Banking: Public banks are lag behind in terms of online banking. Whereas private commercial banks are hundred percent online oriented, there public banks are planning to conduct online banking activity in all branches. Lack of sector specific environmental policy and In-house Environment Management: Public banks have no sector specific environmental policy and in house environment management. Environmental Risk Management Plan: Public banks have no plan for making environmental risk management.

8.0 Recommendations
A set of recommendations can be prearranged for public banks to enlarge their green banking activity- * Public banks should formulate the green banking activity properly and implement this policy appropriately for eco-friendly banking activity. * Public banks should raise their budget for green banking so that they can conduct their green banking activity properly. * Public banks should make proper management team to conduct green banking unit and to operate this unit properly. * Public banks should assure environmental risk rating for all projects. * Public banks should increase their green financing amount to conduct their green banking activity enormously. * Public banks should more focus on online banking because their online banking is not so mentionable. So it can be suggested for publics they can make a contractual agreement with OMNIMUS and other organizations to get these facility. * Public banks should make environmental risk management so that they can conduct their activity in an eco-friendly way. 9.0 Conclusion

Green banks and environmentally responsible banks not only improve their own standards but also affect socially responsible behavior of other business. The banks are playing a pro-active role to take environmental and ecological aspects as part of their lending principle which would force industries to go for mandated investment for environmental management, use of appropriate technologies and management systems. Green Banking if implemented sincerely will act as an effective ex ante deterrent for the polluting industries that give a pass by to the other institutional regulatory mechanisms. The banking and financial sector should be made to work for sustainable development. It is time now that state owned bank can take some major steps to develop their eco-friend activity.

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