Thinking about kickstarting an environmental sustainability program at your credit union? An important first step is to build the business case for sustainability to get the buy-in you’ll need. Keep reading to discover the top 4 reasons that U.S. credit unions are championing environmental sustainability.
1. Your members now care about climate change.
Wonder if your credit union members care about climate change? The answer is likely yes. Climate change hit communities hard in 2022. From wildfires in Arizona, flash floods in Mississippi and scorching temperatures across the United States, extreme weather has become a concern for all. Millions of Americans were evacuated from their homes. Many personally experienced serious property damage, deteriorating health and financial losses. BIPOC communities were hit especially hard and face a long road to recovery.
Surprised? Many are. In fact, while the majority of Americans care about climate change, most believe that other Americans don’t share this view. Nearly 80% of Americans support bold action to tackle climate change, but they falsely perceive that only 43% of Americans agree. Why this disconnect? One reason may be the disproportionate attention paid to loud contrary voices in social media and local communities, that hide this clear shift in national public opinion.
Here are the facts. The majority of Americans, about 64%, say that government and corporations bear responsibility to address climate change. And do they expect their credit union to be environmentally responsible? More and more so everyday.
2. Millennials and Gen Z are switching to ethical financial institutions. Are you one?
Did you know? One of the top 5 banking trends of 2022 is that young people are breaking up with the Big Banks. This is a huge opportunity to leverage the “credit union difference”, attracting youth looking to bank with a financial institution that shares their values. What values? Well, young people care deeply about environmental issues. 96% of Americans between 27 to 45 struggle with climate anxiety, 60% worry about bringing a child into the world. And more than half of Gen Z and millennials say they would switch to an eco-friendly bank.
Switching is increasingly easy. Websites from Bank for Good and Mighty Deposits make it simple for consumers to find eco-friendly banks. Meanwhile, Bank.green offers a green rating for nearly all U.S. financial institutions - check it out to find the ranking of your credit union. Are you leveraging this opportunity to grow your membership?
3. Your branches, operations and loan products may be at risk.
The majority of U.S. financial institutions consider climate change as a key risk to their business within the next five years. A recent study estimated that more than 60% of U.S. credit unions and $1.2 trillion of credit union assets are at physical risk due to extreme weather events - including 60% of deposits, 60% of loans and 57% of home mortgages.
What does this mean? Credit unions will need to assess how its locations and loan repayments may be at risk due to climate change. Credit union branches and mortgaged homes may be located in areas with high risks of floods or water shortages. Businesses in sectors with heavy gas and electricity use may struggle to pay back loans as energy costs continue to rise.
What can you do? Leading credit unions are now evaluating the GHG emissions of their loan and investment portfolios. This data is key to optimize operations and lower risks.
4. Demand for green lending is growing fast.
Consumer demand for electric vehicles, solar panels and energy-efficient home upgrades is expected to rise - and credit unions are well-placed to help make these affordable to their members. The Inflation Reduction Act allocates tens of billions of dollars in grants and loans for households to green their lifestyles, from where they live and how they get around.
As U.S. households take advantage of this new source of government funding, they'll need financing to cover the full costs of these systems. Many credit unions are already responding by offering low-interest green lending options. Just getting started? Inclusiv offers a free, virtual Solar Lending Professional Training and Certification Program that guides you through the steps of creating your first green lending product.
5. It’s the right thing to do. And more and more credit unions are doing it.
Doing the right thing is core to the credit union DNA. Credit unions have long-standing experience in being accountable to its members and investing for positive community impact. Expanding these impact programs to tackle environmental issues just makes sense.
Credit unions across the United States are leading the way. You can find inspiration from BECU, UNFCU, Beneficial State Bank and Self-Help Credit Union. New digital banks make fighting climate change their core mission (Aspiration Bank and Clean Energy Credit Union). And just last November, over 60 credit unions gathered at the annual United in Sustainability Summit to discuss how credit unions can move together and faster.
Convinced? Well, let’s get started then.
Ready to join the credit union sustainability movement? Need more arguments for your credit union to take action? Contact us, our experts have got you covered.