A vital issue that must be considered by all functional areas in recent times is green safety and sustainable ecological balance. To be part of this environment-friendly investment, even the banking sectors of the most environmentally affected countries in the world invest voluntarily in social and environmental activities that targets socially-responsive business and ethics in the form of green banking. Green banking mainly involves the environmental and social responsibility of banks in terms of the contribution they make towards ensuring sustainability of the environment and ecological system, through the wide range of financial products and services that they offer. This chapter will primarily focus on the present status of the banks in complying with the green banking policy to save the environment as well as to increase financial sustainability from the perspective of a developing country like Bangladesh.
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In recent years, the eminent problem of global warming has finally shifted the attention of business practices of all functional areas to climate change, resource efficiency and environmentally conscious issues. As such, initiatives related to green safety and sustainable ecological balance is growing in support. To be part of this environment-friendly investment, most of the companies today focus more upon socially-responsible approaches rather than the traditional profit maximization (The Financial Express, 15 July, 2015). In other words, business practices has moved away from the ‘profit, profit and profit’ motive to the objective of ‘planet, people and profit’. A recent report by OECD claimed such socially-responsible approaches as green investments or investments that are broadly related to the sustainability of the environment (Inderst, Kaminker & Stewart, 2012).
Green investments can be made by companies to their underlying technology, projects or ventures as well as their financial products and services (Croce, Kaminker & Stewart, 2011). For instance, any investments in renewable energy, recycling and waste management, water management, energy efficiency or environmental technologies are various ways of appearing ‘green’ in the market (The Daily Observer, May 26, 2015). Besides, going paperless to save the environment is another approach to define ‘greenness’ for specific goods and services.