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“The financial sector can and should take a stand”

For the second year running, Triodos Bank UK is lead sponsor of the Festival of Economics in Bristol. This year Kees Vendrik, chief economist at Triodos Bank, will feature in the line-up. The Dutchman joined the bank in 2017 with the task of stimulating dialogue for sustainable finance and changing the paradigm of economics. We speak to him about his vision.

We’ve just passed the 10th anniversary of the financial crisis. What’s your view of the banking sector and what happened 10 years ago?

What’s at the heart of banking? Understanding your risk and investing and lending money to private initiatives. What shocked me most in 2008 was that bankers didn’t know what was on their balance sheets. They didn’t understand the products, let alone understand the risk involved.

It seems to me there were some banks in the Netherlands, the United Kingdom and Germany that were run by amateurs. These amateurs spoiled the ethics of the profession, didn’t behave professionally and neglected their duties.

“The basic paradigm that the financial sector is neutral is a lie. Society is starting to wake up to what the banks are doing with its money.”

Kees Vendrik

So what role should a bank play?

A bank is an institution serving society. It collects money, providing a safe place for people to save, and it enables entrepreneurs and investors by lending money for business to take place. A close relationship between banks and the real economy is of essential importance.

On the other hand, we now have this other debate on how banking can contribute to sustainability. Banks are called upon to do so, with challenges such as the United Nations’ Sustainable Development Goals (SDGs) and the national strategies for the Paris Climate Agreement.

We’re starting to get somewhere. We recently brought together the big banks in the Netherlands with a joint letter to government to encourage it to do more. There is a big conversation in my country around the target to halve CO2 emissions by 2030, and the government is responding to this, which is huge. It makes me optimistic when I see this isn’t only an issue for Triodos Bank.

How is Triodos Bank advocating for change in banking?

Our strategy is twofold. Firstly, we’re a bank focused on the real economy, taking into account people, planet and prosperity. So, we have a holistic approach focused on what is of benefit for the communities we finance. That is our basic approach and we have practised it for almost 40 years. This allows us to set an example of how to behave like a modern, socially-oriented bank, with a professional and real approach.

Secondly, advocacy. We bring proposals on how to change the financial system into the conversation. As a European bank, we are very much engaged in discussions in Brussels, on fiduciary duty, disclosure, defining sustainable finance, and other matters.

The basic paradigm that the financial sector is neutral is a lie. Society is starting to wake up to what the banks are doing with its money. The SDGs, and climate risk in particular, must somehow be integrated into financial regulations around the world.

Festival of Economics 2018

Image © Alys Jones

Many people think it’s up to politicians to sort this out. What’s your view as an ex-politician?

At Triodos, we offer people the opportunity to be part of the solution, by opening a current account or a savings account with us. I’m aware that in many countries citizens are quite skeptical about what politics can do. The best answer I can give to that is this: don’t leave politics to other people who don’t engage. The best thing we can do is to step up and participate.

Business, the banking industry, NGOs, citizens and communities can all make a difference, but don’t leave politics to others. Step up if you’re not satisfied with the way politics are run in your country. That’s definitely a motivation for me. I want to be involved, because good politics impact on the course society is following. In my political years, I came across amazing people, good visions, and great ideas, as well as the opposite. But it was one of the best times of my life.

How do you react to the idea that being environmentally friendly is something only for the rich?

It isn’t and shouldn’t be the case. If we say that environmentally-friendly options are elitist, then we ignore the whole issue of how we exploit our planet and we may not act in time to combat climate change.

I think this is the reason why a holistic approach like the one from Triodos Bank is of great importance. I’ve never considered Triodos to be just a green bank. I think social inclusion and a fair distribution of wealth in society also coincide with our green agenda, creating opportunities to finance the fight against climate change. That is why in the Netherlands I was a member of parliament for the so-called Green Left, because these two stories belong together – a fair distribution of wealth is a very basic condition for a successful green economy and society.

What’s your dream? Where do you want to see Triodos Bank or banking in 10 years?

My dream is for Triodos to be ten times bigger than now, not because of direct growth but because we’ve inspired other banks, who use our model to do business. They’ll also look at the level of engagement of our employees. I think that there’s almost no company that equals that level. We have to be modest, but since joining I’ve seen work that Triodos Bank can feel very proud of. A bank is a people’s business, not a model, not a computer. If we keep that, bigger, institutionalised banks will be inspired by our heritage. If they do that, then we’ll make a significant impact.


Kees will be on the panel for ‘Does Economics Care About the Future?’ at 8pm on Thursday 8th November at We The Curious, as part of the Festival of Economics. Tickets are now available. “We support the Festival of Economics to foster further debate about our economic future. Now is the time to promote more alternative thinking around our economic and financial system. We can no longer measure success purely in terms of growth when our resources are finite – and we can work harder to create a global economy that works better for people and planet,” says Bevis Watts, Managing Director, Triodos Bank UK.


Kees Vendrik

Kees was appointed in the new role of chief economist of Triodos Bank NV in April 2017. Previously, he was vice-president of the Court of Audit of the Netherlands and has also held responsibilities such as the presidency of the Institute of Fundraising and the Foundation for Democracy and the Media, also in Holland. He has participated in politics, as a member of parliament and a spokesman for economy and finance at the Dutch Green Left Group.


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Jonathan Chiswell Jones 2 years ago

Kees has not stressed the fact that banks do not simply collect our savings and led them at interest. They also create money, which in the form of bank deposits constitute 93 per cent of the money in circulation. This gives them enormous power. The connection between the levels of saving a bank can attract, and the sums they can lend(by creating loans) is unclear, and I would like him to address and to clarify this important point.

Reply to Jonathan Chiswell Jones
hcarr 2 years ago

Hi Jonathan, thanks for your comment. As a retail and commercial bank, Triodos does create money in the modern economy. This money creation happens when we make a loan from our customers’ deposits. For instance, if a customer deposits £100 with us and we loan out £80 of that to a business, there is now £180 total in existence. Similarly, when the business repays their loan, £80 is destroyed.

Certainly, the creation of money can be both harmful and useful for our economy and our society. As an ethical bank, we only use our ability to create money to benefit initiatives that generate positive environmental, social and cultural change. We understand your concerns around our current monetary system. While we’re not in principle against a different monetary system, it would need to be a change from government and regulators, possibly at a global level, and is not something that we could do alone. Instead we operate within the current system to make money and banking work for people and the planet.

Thanks, Hannah

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