GLS Bank

Money is to serve the people. Money is there for the people.

Sunday 2 June 2013, by niels.steinberg@cbs-edu.de

1 inspired

A. The main facts about the activities of the company.

The name GLS Bank translates as "community bank for loans and gifts" and is the first German ethical bank with an anthroposophical business approach founded in 1974. Their focus is on social, cultural and ecological development to improve overall well-being of society. They understand that people and their needs should be the focus of economic activities. Hence, the approach chosen is to find a balance between "Real Use - Social & Ecological", "Interest/Yield", "Security/Risk" and "Liquidity/Availability". The "ecological" responsibility refers to maintaining and developing the Earth’s livelihood and the "economy" is seen as the instrument to do so as efficiently as possible.

GLS Bank is funding more than 11.000 projects a year in education, renewable energies, sustainable construction and many more. The investment decisions are strictly screened to ensure the highest ethical value of projects and their intentions. The keyword in this context is "Transparency" with regard to investment decisions, which are being published on a regular basis in their magazine "Der Bankenspiegel" which translates as "Banking Mirror".
Thus, every customer can decide where to invest his/her own money in, which has a real impact on social and/or ecological development.

In addition to that GLS Bank is a co-founder of the international initiative "Global Alliance for Banking Values (GABV)" to foster social and ecological development and a create a more successful and sustainable economic model for the profit-maximization seeking banking sector. Thus, especially after the financial crisis the demand for sustainable banking products has risen, resulting in high growth of the GLS Bank.

B. The Ethical challenges this company is addressing.

"You can give away the responsibility for your money at the bank counter. But you don’t have to."

Every member can decide where his/her money should be invested and everyone has a vote regardless of the amount of cooperative shares. By doing so GLS Bank promotes to manage money sustainably and responsibly. Money is the activating element for individual and social fields of development like education, health, energy, housing and nutrition. The economy should serve the people to fulfill these needs by providing a sustainable loan business. Money should serve the people, not the other way around!

C. What makes you believe this company is really ethical and why you trust it?

The key to trustworthiness is transparency of motivations and operations. GLS Bank is a professionally run sustainable bank with a clear and honest communication of their business purpose and a transparent disclosure of all their operations. It is completely accepted within the industry and gained the highest honors as the best bank of the year and won the German sustainability award by the German government. Since, they clearly put people first and use money solely as a tool to improve living, GLS gives away no reason for any doubt about possible malpractices or exploitations for the sake of profits. It is simply not the primary goal to achieve highest profits and not as important as human needs. Therefore there are no other intentions attached or disguised, apart from making life a little bit better and show a responsible and sustainable way on how to use money.

D.The possible challenges facing the company in the future and how you think this company may improve.

The most difficult challenge for GLS Bank is to decide where to invest its limited resources, so these are put at the best use, where they are needed and make the most of a difference. Fortunately, GLS Bank is growing steadily and more and more people become aware of the importance of sustainable use of money and how it can be used to change for a better life, once money is used to serve the overall well-being and not the ultimate maxim of a solely capitalistic and profit oriented society.

Hence, with increasing demand for sustainable and responsible banking offers, GLS needs an adequate growth strategy to become available for a majority of people, also in terms of convenience, in order to make it as easy as possible to join GLS and its purpose. So far GLS is still very dependent on the classical banking system infrastructure, which should be just a matter of time to change that in the future. A sufficient momentum is already existing, so it is up to everyone to take responsibility for his/her money and put it at good use. By doing so, word of mouth and corresponding actions will show the right way into a sustainable future. In the long run, there will be a change of paradigms in the banking industry. The profit maxim will be replaced by socially responsible impact investments, which will become a synonym for success. It won’t be anymore: "How much profit did you make out of your latest investment?", it will be: "How many jobs did you create? How many emissions did you save? How many children did you make happy with your last investment? How many people can now enjoy and benefit from organic food?".

For me this is very inspiring to see how a bank like GLS, which puts social and ecological values first, can succeed in an industry that is usually solely focusing on profits.

Bibliography

http://en.wikipedia.org/wiki/GLS_Bank

http://www.gls.de/

Location: Bochum (Germany)

Sector: Financial and insurance activities

Official website: https://www.gls.de/privatkunden/english/

Key figures:

Type: Cooperative
Number of employees: 430
Number of members: 27.400
Assets under Management: 2,72 billion €
(in 2012)

Awards:
Bank of the year in Germany: 2010, 2011, 2012
German Sustainability Award Winner 2012

"Stop Climate Change" certified to reduce its impact of operations

Nbr. visits: 408

Nbr. inspires: 1