[LUM#23] Banks in the Green, and Against Everyone
Last October, the Net-Zero Banking Alliance—the UN’s carbon-neutrality initiative for the banking sector launched in 2021—announced the end of its operations. This setback, however, has not prevented many regional banks from embarking on their own transition, as suggested by a case study conducted by Christine Marsal, a researcher at Montpellier Research in Management.
“We will drill, baby, drill”—Donald Trump’s campaign slogan set the tone, and it wasn’t a green one. In the wake of his election in 2024, six major U.S. banks announced their withdrawal from the Net-Zero Banking Alliance (NZBA). This United Nations program, aimed, among other things, at ending financing for fossil fuels, had brought together more than 150 banks worldwide. But since then, “the program has been on the back burner, ” laments Christine Marsal, a researcher at Montpellier Research in Management, “yet it has enabled incredible progress!”
Green bonds
To be more precise, it is the combination of the NZBA and the European regulations developed since 2020 as part of the Green Deal that have enabled the banking sector to begin its ecological transition. “Europe has this tremendous strength of proposing standards that set common goals. A whole set of regulations has thus been implemented with new obligations for the banking sector,” notes the professor, who teaches management sciences atthe IAE.
To comply with these requirements, many banks have therefore created positions—or even entire departments—dedicated to climate change. Their mission? “To establish metrics that will enable them to set goals and report on the progress made toward the transition through detailed and easily accessible reporting, as required by the EU,” explains the researcher.
But how can a bank help protect the planet? “Through green bonds, which have seen rapid growth in the wake of the Paris Agreement. ” These bonds can finance renewable energy by offering clients investments in this sector, as well as research and development and transportation—by promoting loans for electric cars or energy-efficient home renovations, etc. But we still need to convince employees to sell these products and customers to buy them.
Strong structure
Christine Marsal conducted a case study with a CSR (corporate social responsibility) manager hired by a regional bank in Montpellier (Information asymmetry in fighting climate change: empirical evidence from a French regional bank based on structuration theory, 2024). The researcher was able to conduct two rounds of interviews with bank employees and access various reports to try to understand how the transition is taking shape within a bank branch.
Her thesis? To show that a shift in practices is made possible by a dual process involving both internal and external structures. “This theory, known as the theory of strong structuration, was developed by the Australian sociologist Rob Stones,” she explains . She argues that change within an organization can be driven both by key actors who will transform individuals’ internal structures by altering their beliefs—for example, to strengthen commitment to the fight against global warming—and by the organizations themselves, by modifying external structures through the creation of a department dedicated to climate change or by organizing training sessions, discussion groups, and so on.
A special case
“What convinced me to conduct this case study was the profile of this CSR manager,” explains Christine Marsal. “He lives and breathes his commitment and goes to great lengths to educate others about the regulations and convince employees of the need to comply with them. In fact, all the participants in the interviews I conducted acknowledge his charisma and significant influence.” ” In particular, this manager has established a network of ambassadors within the bank who act as liaisons throughout the organization.
The interviews conducted by the researcher also revealed resistance among some employees. “To them, this regulation is nonsense; they want to do business and believe that financiers have no business concerning themselves with the oceans.” ” There is also resistance among the bank’s clients, whom Christine Marsal was able to reach through a series of interviews conducted by her students, in which the fear of an uncertain investment—especially when it comes to green products—or suspicions of greenwashing often act as deterrents. “This reflects a lack of trust in banks, but it also shows that when it comes to money, the environment is no longer really the priority.”
On the right track
This observation does not prevent the researcher from drawing a positive conclusion from this case study. And even though these conclusions are limited to this particular bank and closely tied to the personality of this manager, Christine Marsal assures us: “Things are changing. Banking in
s are evolving their structures, and attitudes within the sector are maturing, just as those of customers are—not all of them, but some. The NZBA ruling is certainly a negative sign, but something is underway.” Still, that path must be a green one.
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