ABSTRACT
This chapter focuses on the development of new products such as environmentally friendly investment funds. It explores the role of banks in the progress toward sustainable development. The role of banks in contributing toward sustainable development is potentially enormous, because of their intermediary role in an economy. Banks have an important role in an economy: they are intermediaries between people with shortages and surpluses of capital. The financial sector has also made a voluntary agreement with the Dutch government to cut its energy use by 25% from a 1995 baseline by 2006. To understand the environmental impacts of banks, one has to make a distinction between internal and external issues. The Verein fur Umweltmanagement methodology certainly needs to be improved, but is a positive development towards standardised measurement of internal environmental performance in the banking community. The chapter provides some conclusions about the dynamic and likely changing role of banks in the future.
