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Banks are "only ever" going to promote the good that they do, but brokers can "effect change" by educating clients about ethical lenders, a broker has said.
Karen Doust, associate and broker at Jenesis Finance, told The Adviser that brokers can have a role in enacting positive change by placing business with ethical lenders.
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Jenesis Finance has a mandate to offer clients a panel of "ethical and sustainable lenders" that are "community minded and/or are operating in an environmentally conscious manner".
Ms Doust said that more often than not, these lenders are smaller banks, credit unions or non-bank lenders.
"We try to stay away from people that invest in fossil fuels and we mostly deal with the smaller credit unions and non-banks that are not only externally, but also internally, having more values so obviously treating their staff well as well as their community.
"The only way [to enact change as brokers] is to put your money where your mouth is ... and actually place your business with those lenders, rather than the other lenders. That's the only way that you're going to effect change."
However, she added that sustainable lending is also consumer-driven to a degree. For example, Ms Doust's partnership with ethical wedding business Less Stuff More Meaning, six months ago, was the result of Ms Doust and business partner Sandra Henri realising that consumers are looking to align their values with their banking.
"The more we looked into it, the more we realised that people out there now are thinking about what they're actually doing with their banking," she said.
"Before, I think people just thought that there were majors and those were the only options that they had, but a lot of people are now realigning their values in life and would like their banking to align with those values."
In the time since then, Ms Doust has been pleasantly surprised by the ability of Jenesis Finance' lender panel to meet her clients' needs.
"[We haven't hit] the challenges that we thought that we would hit — like credit policies with the non-banks [because] they're usually more stringent than the larger banks. To date, we haven't needed to go for clients to anywhere but our preferred panel."
Ms Doust added that as an ethical broker, she considers not only the investment actions of banks but also the internal treatment of staff and the banks' interest in giving "back to the community".
[Related: ‘Overwhelming shift’ in consumers wanting alternatives: Homeloans]
