Most Ethical Banks

Searching for banks devoted to making a positive impact on the world? Look no further than this detailed guide to the most ethical banks.

There is a growing push for businesses, including banks, to be more ethical.

But can banks really be instruments of positive change?

Only time will tell.

In the meantime, some banks are working to incorporate more ethical and responsible practices. Keep reading to learn more about the most ethical banks and what they're doing to benefit society.

Are Any Banks Ethical?

Yes, there actually are banks that make a strong effort to improve the world they operate in.

Review the factors below to help you determine whether a bank is ethical or not.

1. Transparency
Follow the money, as they say. Any ethical bank should have publicly available investment portfolio which discloses the industries they invest in.

For example, be wary of a bank that claims to be green, but hides its investments. As far as you know, they may have huge stake in the fossil fuel industry.

Many ethical banks will also be willing to answer customers' questions about their business practices directly.

2. Taxes
Yes, banks pay them too. Mostly. Thanks to the complexity of tax law and the existence of tax havens, more money often means a greater ability to avoid paying taxes.

But and while nobody wants to pay them, they are a vital component of a functioning society.

An ethical bank will pay the taxes it owes, instead of practicing the avoidance strategies so common in other businesses.

3. Fair Pay
In every industry, there is a huge, growing gap between managements' wages and those of everyone else.

In fact, it's common to hear stories of CEOs getting million-dollar bonuses while their employees are barely scraping by.

When looking for an ethical bank, look for leadership that values its employees enough to take less and give more.

4. Policies and Mission Statements
If you want to know what a bank is about, read their policies. What promises do they make to their investors and their customers?

Do they vow to work toward improving social welfare? Do they have specific strategies for protecting the environment, or those in need?

A policy is no guarantee of follow-through, but it shows you at least what they claim to believe in. The more specific, the better.

5. Certifications and Accreditations
There are several certifications and accreditations that banks and other businesses can receive for ethical behavior.

• B Corporation: B Corp certification is given to businesses dedicated to making a "social and environmental impact."

  A B Impact Assessment score measures social and environmental performance. They must make a legal commitment to be accountable to all stakeholders, and meet certain transparency standards.

• The Global Alliance for Banking on Values (GABV): Membership in the GABV indicates that a bank or banking cooperative has made it a part of their mission to support social, economic, and environmental change through their business.

• Community Development Financial Institutions: Banking institutions with this certification provide services to people in low-income communities or those who would otherwise lack access.

Most Ethical Banks

Now that you have a better idea of what to look for in an ethical bank, let's take a look at some examples of those qualities. Here's our list of the most ethical banks out there.

1. Aspiration

With Aspiration, you know where your money's going and where it isn't. While not technically a bank, this B Corp-certified financial firm has been using its profits to help fight climate change and give to communities since 2013.

One in every 10 dollars that customers spend is donated to charity, and they round up spending to put aside money for planting trees. They also don't invest in any related to the fossil fuel industry.

Aspiration also offers carbon offsetting services on gas purchases, and their cards are made from plastic recycled from the sea.

There are plenty of businesses that claim they care about the environment, but as one of the most ethical financial firms out there, Aspiration is really putting their money where their mouth is.

Features

• Interest-paying savings accounts
  
• Cash back on purchases from Conscience Coalition companies
  
• Get paid 2 days early with direct deposits
  
• Free ATM access
  
• Plant trees when you swipe
  
• Mastercard Global Service
  
• Purchase Assurance for lost or damaged items in the first 90 days
  
• Carbon Neutral Mastercard pays 1% cash back on all purchases in months you're carbon neutral

2. Amalgamated Bank

If you're pro-union and pro-labor, then you'll want to check out Amalgamated Bank.

This New York-based, B Corp-certified bank works with over 1,000 unions and over 500 progressive political organizations to effect positive social change. They're also 40% owned by the Workers United union.

They support a variety of causes, both social and environmental. Powered by 100% renewable energy, Amalgamated Bank is net-zero, and has a history of supporting workers' rights, immigrants, and housing for all.

They provide special lines of credit to homeowners interested in going solar, and invest in stock portfolios that include clean energy. Other causes they support include racial justice, LGBTQ+ rights, and universal access to banking.

Features

• Personal Checking and Savings accounts
  
• Donate spare change to WNBPA Social Impact Fund
  
• Credit Cards
  
• Give Back Savings Accounts donate interest to a cause of your choice
  
• Mortgages and Home Equity Lines of Credit
  
• Fossil Fuel Free Investment Portfolio
  
• Tobacco Free Investment Fund
  
• ESG Investing options

3. Ando

Ando Money is a bank focusing on sustainability.

Ando has made a commitment to fight climate change and be transparent with customers about where their money is going. This is in stark contrast to many traditional banks that use their members' money to fund unethical industries without their knowledge.

The types of businesses that Ando funds are ones dedicated to clean energy, sustainable agriculture, and other green initiatives. By putting their efforts toward carbon-reducing technologies, they aim to turn banking into a service that's both useful and effective for their customers and the environment as well.

Ando is a member of the Bank for Good Coalition.

Features

• Mobile Banking
  
• Digital Money Transfers
  
• Send Paperless Checks
  
• Cash Back Visa Debit Card
  
• Get Pay 2 Days Early
  
• High Yield Savings Account
  
• ATM Access
  
• Overdraft Protection

4. Spring Bank

Spring Bank earned the Best for the World award from B Lab in the categories of Customers and Governance in 2021.^[1]

Founded in 2007 in the South Bronx, they're the first B Corp in New York State, with a second location in Harlem opened in 2012.

One of their main goals is providing financial services to those who otherwise wouldn't have access.

Many people in the areas they serve have historically been forced to turn to high-cost, predatory financial services. Spring Bank aims to offer them the same quality of service and care available elsewhere.

Spring Bank offers financing to help build small businesses and encourage entrepreneurship, as well as personal banking services. They are B Corp and CDFI certified.

Features

• Personal Checking and Savings accounts
  
• Personal Lending
  
• Nonprofit Banking
  
• Business Checking Accounts
  
• Business Loans
  
• ATM Access
  
• Online Banking

5. Sunrise Bank

Sunrise Bank is a Minnesota-based bank with a full range of ethical banking certifications, including B Corp status, CDFI certification, and GABV membership.

Sunrise is committed to making a positive impact in their own backyard: the Twin Cities Metro area around Minneapolis and St. Paul.

They give a minimum of 2% net income per year through sponsorships and corporate donations. This is used to support causes like affordable housing and shelter, diversity and inclusion, and narrowing the achievement gap.

They provide 40 hours paid time off for their employees to spend volunteering on worthy causes each year. Sunrise Bank operates an Impact Deposit Fund that supports affordable housing, community services, small business, and economic development.^[2]

Features

• Personal Checking and Savings accounts
  
• Youth and Retirement Savings
  
• Home and Auto Lending
  
• Online Banking
  
• Credit Cards
  
• Business Banking Services
  
• Business Loans

6. Ally Bank

While social impact isn't necessarily built into the bones of Ally Bank, as it is with some of the others on this list, in 2017 they decided to make a real effort to effect positive change in the world through the resources they have at hand. This included a focus on environmental, social, and governance issues, also known as ESG.

They made a gift of $34 million to start the Ally Charitable Foundation, invested over 14,000 hours in volunteer work with their employees, and have now received "Outstanding" Community Reinvestment Act (CRA) ratings two years in a row.

They have also promoted financial literacy through the Ally Wallet Wise Classes they started running in 2011. They even helped kids learn about proper money management with a children's book published in 2017 called "Planet Zeee and the Money Tree."

Features

• Personal Checking and Savings accounts
  
• High Yield Savings
  
• Retirement and Investing Accounts
  
• Home Loans and Mortgage Refinance
  
• Auto Loans
  
• Personal Medical and Home Repair Loans

7. Beneficial State Bank

Beneficial State Bank operates out of the world's greenest commercial building. That should tell you something about their priorities.

They're certified with B Corp, CDFI, and GABV, and they have a range of noteworthy, ethical goals.

Beneficial State Bank supports businesses and nonprofits owned by underserved groups and minorities, plus worker-owned cooperatives, benefit corporations, Social Purpose corporations, and nonprofit organizations.

They go out of their way to provide quality service to businesses whose aim is to improve life for those in the community and those focusing on sustainability goals.

Features

• Personal Checking and Savings accounts
  
• Auto Loans
  
• Credit Cards
  
• Financial Planning
  
• Business Banking Services
  
• Mobile Banking
  
• Nonprofit Banking Services
  
• ATM Access

8. OneUnited Bank

OneUnited Bank has the distinction of being the largest Black-owned bank in America.

Founded in Boston, Massachusetts, they have branches in Los Angeles and Miami as well. OneUnited is CDFI certified, with an aim to provide financial services to mid-to-low- income communities around the U.S.

Members can take advantage of helpful services, like their BankBlack Early Pay service, which gives access to their paycheck up to 2 days early. Members can also open a fee-free Black Wall Street Checking account.

Features

• Personal Checking and Savings accounts
  
• Credit Building Visa Card
  
• Mobile Banking
  
• Early Pay Service
  
• Financial Education Center

9. City First Bank

City First Bank, another Black-owned bank whose aim is to help support underserved and underrepresented communities, is based in Washington, DC, with branches in Los Angeles as well.

Since their merger with Broadway Federal Bank, f.s.b. in April of 2021, they've become the largest Black-led Minority Depository Institution (MDI) in the U.S. ^[3]

City First Bank is B Corp and CDFI certified. They work with several nonprofit organizations to support economic equality, including City First Enterprises, City First Foundation, and City First Homes.

They work to support small businesses locally, offer housing that is both safe and affordable, support health and arts programs, and pathways to education for members of the community.

Features

• Personal Checking and Savings accounts
  
• CDARS
  
• Insured Cash Sweep
  
• Business Banking Services
  
• Cash Management Services
  
• ATM Access

10. Capital One

You've likely heard of Capital One, but you may not be aware of their efforts toward sustainability.

This popular online bank often sends promotional materials in the mail, but you may be relieved to hear that they use 95% environmentally preferred paper.

They also aim to:

• Have 100% renewable energy across their portfolio
  
• Get LEED Silver certifications on new buildings and major renovations of existing locations
  
• Reduce campus landfill waste by 50%, and use 20% less water by 2025

They have even set an internal price on carbon, an initiative which many hope the government will adopt in the future.

Features

• Personal Checking and Savings accounts
  
• Credit Cards for Students, Credit Building, Business, and more
  
• Auto Financing
  
• Business Banking and Loans
  
• Commercial Banking Services

11. Triodos Bank

For those looking for a transparent banking option in Europe, Triodos Bank is worth looking into.

This Netherlands-based bank has branches in the UK, Belgium, Germany, France, and Spain. They're also extremely transparent about where their money goes.

Triodos Bank has a carbon tracker on the front page of their website, and they have made a commitment not just to the environment, but to leave a positive impact on society and culture as well.

Triodos puts their money toward worthy causes such as organic agriculture, solar, wind, and hydro energy.

They offer "green mortgages" to homebuyers pursuing sustainable housing. They support arts and education programs, affordable housing, healthcare services, and financial services for underserved communities.

Features

• Personal Checking and Savings accounts
  
• ISAs
  
• Investing
  
• Crowdfunding
  
• Business Lending
  
• Business Banking Services
  
• Banking Services for Charities

12. Bank Australia

Eco-conscious Australian readers may be pleased to hear that Bank Australia is a certified B Corp and has committed to avoiding all fossil-fuel industry investments.

What's more, they don't invest in weapons, gambling, or tobacco-related businesses either.

Bank Australia is customer-owned, which means your hard-earned dollars won't be going to pay the bonuses of their CEO or lining the pockets of shareholders.

And with the environment in mind, they've set aside 2117 hectares as a Conservation Reserve in Western Victoria.

Features

• Personal Checking and Savings accounts
  
• Personal Loans
  
• Auto Loans
  
• Credit Cards
  
• Insurance
  
• Home Loans
  
• Business Banking Services

Bottom Line

Where you bank matters. After all, the money in your bank account is available for your bank to use however they see fit.

Choosing the right bank could mean the difference between indirectly supporting the continued use of fossil fuels, or green energy, community-building, and financial stability for the masses.

The good news is, there are plenty of options to choose from. Whether you're an individual, a business, or a nonprofit, there are great options for those searching for an ethical bank.

References