The ethics of commercial lending... what would you do?

Wednesday 9 June, 2021
by Anonymous

You’re a middle manager, working in commercial lending at a bank. The organisation is very purpose and values driven and focussed on sustainability and ethical practices.  

A new client has applied for a loan to place hundreds of solar panels on the roof of their battery chicken farm.  

You’re left wondering if they are an appropriate fit in terms of values alignment.  

One of the strengths of your organisation is its commitment to ethical investing and the solar panels is a significant investment.

What would you do?

We challenge you to create a healthy discussion with your colleagues and post a comment below. You could even encourage them to consider taking The Banking and Finance Oath!

Please share your ethical dilemmas with us - we can post them anonymously. You can email your dilemmas to dilemma@thebfo.org

Photo by Nighthawk Shoots on Unsplash

Comments

There are 4 comments for The ethics of commercial lending... what would you do? .

Re: The ethics of commercial lending... what would you do?

Thursday 10 June, 2021
by Abhinav
I think this is an opportunity to talk with the potential client and see whether they are interested in transitioning to a different model - one which is more ethical. Perhaps you could see if there is data that supports the case.
If they were not open to considering this as an option, I wouldn't take them as a client.

Re: The ethics of commercial lending... what would you do?

Thursday 10 June, 2021
by Michael S
I would encourage the client to consider becoming a free range chicken farm and if they agreed to that change in their business, I would take them on as a client.

Re: The ethics of commercial lending... what would you do?

Tuesday 22 June, 2021
by Alex
Regardless of the benefit of the solar power, the question here is the support we provide to the owner of the battery cage farms. Some have asked if the owner is willing to transition the business, and while that is great there is another factor we should consider.
The fact is supermarkets still sell battery cage eggs. In a perfect world there would be no battery Cage Farms. But at the moment there is and there are financially disadvantaged members of the community that rely on cheaper food sources to nourish their families (The level of nourishment that a battery Cage egg provides is a discussion for another forum!)
How are we to support a chicken farm that profits from inhumane treatment and cruel treatment of hens?
But also on the flipside how are we to proactively limit the availability of cheaper food alternatives for members of our community who are struggling financially?
Both have ethical implications but how do we prioritise which is more important?
I think the question is which is the lesser of two evils?
A classic Ethical Dilemma.

Re: The ethics of commercial lending... what would you do?

Friday 25 June, 2021
by Jonathan
The customer's business is unethical. That's what is being financed. The fact that the unethical business is using financing for an ethical product is more cynical than redeeming.

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