Are commercial banks practicing greenwashing by advertising so-called green loans, i.e. loans which they have been giving on a small scale for many years and have recently called green loans?

Do financial institutions, including commercial banks practice greenwashing by advertising so-called green loans, i.e. loans which they have been giving on a small scale for many years and have recently called green loans in connection with fashionable trends for sustainable economy, green economy, green transformation, closed loop economy, realization of sustainable development goals?

Globally, financial institutions, including commercial and investment banks continue to finance on a large scale the development of dirty energy based on the burning of fossils and the mining sector involved in extracting fossil fuels from the earth's crust. On the other hand, in recent years, financial institutions, including commercial banks recognizing the growth of pro-environmental, pro-climate and pro-environmental awareness of citizens, i.e. also customers of banking product and service offerings. Therefore, in order to improve their image in advertising campaigns, conferences, public relations meetings, etc., they present themselves as green financial institutions offering green loans, green bonds and other forms of green external financing. So-called green external financing is carried out by banks on the same terms or on a slightly promotional basis vis-à-vis other types of external financing not qualified by the definition of these terms as green financing. The research shows that financial institutions, including commercial banks are practicing greenwashing by advertising so-called green loans, i.e. loans which they have been providing for many years on a small scale and recently, in connection with the fashionable trends for sustainable economy, green economy, green transformation, closed loop economy, realization of sustainable development goals, have called green loans. In addition, individual commercial banks in order to distinguish themselves from each other in terms of their green financing offers and their green financial institution missions, missions articulated in advertising campaigns and marketing communications with customers are for the same issues of green, sustainable, zero-carbon closed loop economy use different terms for the same issues. Well, in marketing communications using the issues of the above-mentioned issues, they use different terms for sustainable economy, green economy, green economy transformation, closed loop economy, realization of sustainable development goals, etc. Since commercial banks have for many years been lending, among other things, to such economic ventures as the construction of sewage treatment plants, the erection of a windmill to generate electricity, the acquisition of new technologies by a municipal cleaning company, etc., and it is only recently that this financing has been called green financing and is particularly promoted and highlighted in advertising campaigns that there are considerations about the possibility of large-scale greenwashing by financial institutions operating in this way. Just as many years ago, when the concepts of sustainable economy, sustainable development goals, zero-carbon economy, closed-loop economy did not appear in the marketing communications of commercial banks, media debates, or did not yet exist at all, commercial banks financed pro-environmental business ventures, which at the time were not defined and defined in such a way. However, both at that time, e.g. in the late 1990s and earlier, the scale of lending that financed pro-environmental, pro-climate, pro-sustainability economic ventures was relatively small. The situation is similar today. In the 1990s in Poland, even a commercial bank, which has the term “Bank Ochrony Środowiska” in its name, also granted loans to finance projects that had nothing to do with ecology and sustainable economic development and the financing that we now call green was only part of the total lending activity. On the other hand, the relatively small increase in the scale of green lending by commercial banks recorded in recent years is due to the banks' use of emerging opportunities for co-participation in green financing programs for investment projects carried out mainly in the field of green transformation of the energy sector, including, for example, financing the installation by prosumers of photovoltaic panels on the roofs of their properties or businesses based on financial subsidies from the state's public finance system and/or European Union grants. Co-participation of commercial banks involves, for example, providing bridge loans to borrowers who, using subsidies from the state's public finance system, implement certain pro-climate and/or pro-environmental economic projects. In POlska, some such programs for financing green economic ventures with subsidies are combined with the obligatory use of bridge loans pending the transfer of subsidies. In Poland, banks have lobbied in the political sphere for this kind of solution in order to increase for themselves the market for loans granted and to increase the scale of the various types of loans that have been granted for years, which now then qualify for so-called green financing. In addition, commercial banks are motivated to develop green financing by the new European Union regulations coming into force regarding the corporate obligations imposed first on large corporations, large enterprises and companies and in subsequent years, i.e. from 2025 onwards, also on SME operators with regard to obligations to implement expanded, non-financial ESG reporting. The aforementioned expanded, non-financial ESG reporting is to play the role of increasing the transparency of companies, including equity companies, listed companies to shareholders, business counterparties and customers, and is to play the role of a motivator to increase the scale of implementation of pro-climate, pro-environmental, green business ventures, increase the scale of inclusion in the processes of green transformation of the economy and the implementation of sustainable development goals. commercial banks have seen in this process synergies for themselves and new opportunities for business development and cooperation with key customers such as business entities. Subsequently, all these emerging opportunities in recent years that banks use to scale up the development of green financing are presented in advertising campaigns as key determinants of their banking business presented as green banking, socially responsible banking, climate and environmentally responsible banking, banking that pursues many of the goals of sustainable development, banking that is highly supportive of the green transformation of the economy which is often an outstanding exaggeration of this issue, i.e. presenting themselves as green financial institutions. In view of the above, many commercial banks that currently use the technique of presenting themselves in marketing communications as green financial institutions on a large scale are practicing greenwashing.

I have described key aspects of the realities of the so-called green finnsing currently practiced by commercial banks, including the green loans they provide and many other key aspects of the green transformation of the economy in the article:

IMPLEMENTATION OF THE PRINCIPLES OF SUSTAINABLE ECONOMY DEVELOPMENT AS A KEY ELEMENT OF THE PRO-ECOLOGICAL TRANSFORMATION OF THE ECONOMY TOWARDS GREEN ECONOMY AND CIRCULAR ECONOMY

Article IMPLEMENTATION OF THE PRINCIPLES OF SUSTAINABLE ECONOMY DEVE...

I invite you to familiarize yourself with the issues described in the publications given above, as well as to scientific cooperation in these issues.

In view of the above, I address the following question to the esteemed community of scientists and researchers:

Are financial institutions, including commercial banks, practicing greenwashing by advertising so-called green loans, i.e. loans which they have been giving for many years on a small scale and recently, in connection with the fashionable trends for sustainable economy, green economy, green transformation, closed loop economy, realization of sustainable development goals, called green loans?

Are commercial banks practicing greenwashing by advertising so-called green loans, i.e. loans which they have been giving for many years on a small scale and recently called green loans?

Do commercial banks practice greenwashing by advertising so-called green credits, some of which they have already given under other names?

And what is your opinion about it?

What is your opinion on this issue?

Please answer,

I invite everyone to join the discussion,

Thank you very much,

Best wishes,

Dariusz Prokopowicz

The above text is entirely my own work written by me on the basis of my research.

In writing this text, I did not use other sources or automatic text generation systems.

Copyright by Dariusz Prokopowicz