Recovery towards what? Finance, justice, suistanaibility Alternative Banking models: Banca Etica Mauro Ferrari e Dario Brollo Area socio culturale di Banca Etica

SUMMARY  5 slides on Banca Etica  Alternatives Models  figures  Conclusion

Banca Etica’ s history (Italy)  80’s: first experiences of ethical finance in Italy with financial cooperative associations (transparency and mutuality);  1995: 22 non profit organisations founded “Cooperativa Verso la Banca Etica” which is looking for shareholder of the future bank (target 7mio Euro);  1999: Banca Etica opened its first branch office in Padova  2000: CTM-Mag becomes Etimos, a microcredit consortium  2003: Etica sgr, ethical funds, opened  2004: First Terra Futura annual eco-social fair, today visitors 600 exhibitors  2009: Banca Etica has more than members (including corporate body) 13 branches in all Italy, 700 Mio. Euro savings

Cultural activity Microcredit Ethical funds BANCA ETICA’S SYSTEM Terra Futura social eco-fair may ‘10 Firenze Valori (monthly Newsp) Zoes.it Social networking for responsible economy Shareholder activism On ENI & ENEL co.

ethically oriented finance is aware of non economic consequences of economic actions; access to finance, in all its forms, is a human right; efficiency and soberness are components of ethical responsibility; profit produced by the ownership and exchange of money must come from activities oriented towards common well-being and shall have to be equally distributed among all subjects which contribute to its realisation; PRINCIPLES OF ETHICAL FINANCE

maximum transparency of all operations is one of the main conditions of all ethical finance activities; the active involvement of shareholders and savers in the company's decision making process must be encouraged; each organisation which accepts and adheres to the principles of ethical finance undertakes to inspire its entire activity to such principles. PRINCIPLES OF ETHICAL FINANCE

 Institutional Bodies  shareholders’ general assembly  board of directors  executive committee  board of auditors  committee of guarantors  direction  operational office  branch offices  Associative structure:  64 territorial organisation of shareholders  Ethical Committee Banca Etica structure

Alternative banking Models Looking for: savers, investors, shareholders, entrepreneurs, managers and financial intermediaries to develop values driven cultures that reflect their acknowledged responsibility for the social and environmental impact of their activities.

 Offer choice of conscientious and transparent savings and investment  Banking business: professional, innovative and coherent to principles  Internal shareholder democracy and participation  Participation in the public debate on local and global finance regulation  Double evaluation of loans : capacity of redemption of the loan + impact on the environment and the society  Collaborative initiatives, joint ventures and partnerships with other banks (also not alternative ones) Alternative Models: institution

Alternative Models: what to do or to finance  Microfinance: individuals and MFI  Social entrepreneurs running green and social businesses  No-profit organizations  Low impact lifestyles patterns  Social Cooperatives (welfare, production, services)  Mutualism and local governments  Ethical funds (best in class approach)  Shareholder activism / capitalism democracy

Alternative Models Coalition about alternative financial experience: Global alliance (for banking on values)

Some figures of Global alliance  combined assets exceeding USD 10 billion  > 7 million customers  they employ more than 45,000 people.  combined equity exceeding USD 940 million.  average growth rates of 24%  generate a decent and stable return on equity, both in financial terms and in added social value  they have shown remarkable resistance in the face of the financial crisis.

Are those figures relevant? 2008 data (euro) Bank savings in Italy Banc etica’s savings This means about 0,043 % of the market!!! But….

Are those figures relevant? A recent survay by demos ( ott09 ) shows that:  Transparency is the most popular request to banks  Banca Etica is known and appreciate by about 10% of Italian population  People have a very poor confidence in traditional banking

Conclusions Positive  There are many possibilities of alternative banking  Growing sector, Growing interest, business opportunities Obstacles:  Unfair competition, “fake” alternative approach  Inefficiency due to little figures  Cultural behavior of Not-responsible economy  Financial rules thought for big “traditional” players

THE NET OF BANCA ETICA  13 Branches and 2 more opening;  27 Financial Promoters;  64 Local Shareholders Groups;  201 employees and co- workers Update January 2009

SERVICES  bank accounts, for individuals and organisations, and further services such as direct debit cards, credit cards, home banking, credit transfer in Italy and abroad, bancalight (banking operations management from the mobile phone), internet banking;  certificates of deposit;  saving books;  debentures, bonds;  investment funds Responsible Values of Etica Sgr;  foreign services: bank accounts and related services;