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Nils Buis / Jaap van Leeuwen

A different attitude to money

In the economy, the role of money is increasingly important. Money, in the form of capital, interest, shares and options, has become a product in itself. It bears no relation to its original function any more, which was to be a means of exchange. The fifty most powerful companies in the Netherlands include nine banks and insurance companies. Five of these are numbered among the top ten. Through mergers and take-overs, some of them are spreading themselves throughout the world1. The ever-increasing importance of the money-trade gives rise to the question of how we can control the role of money.

One obvious alternative use of money is to donate or lend it to projects committed to sustainability. Investors can either directly place money into projects that they wish to support, or else use an indirect route, if they are concerned about an eventual guaranteed return or would prefer the decision-making about which projects to support to be managed through specialist channels.
We categorise such 'channels' into three types. The most far-reaching method of controlling the flow of capital is to found a new bank, but financial and legal conditions make this difficult nowadays. However, some Dutch banks in the Netherlands (Triodos Bank; the ANS Bank) present themselves as 'radical' and different, claiming social, ethical and ecological principles. The second 'authority' lies in possible investments in 'green' or ethical funds. Apart from Triodos Bank and the ASN Bank, other larger banks increasingly offer such investment products. In the Netherlands the third 'authority' consists in two unique Schenk-Fonds (gift funds).

Green and ethical investment
In recent years, interest in 'green and ethical' investment has increased. This relates directly to a 1995 tax reform which made dividends on green investments tax-free. The Dutch state thus promotes investments that help to protect nature and the environment. But this also started a huge growth in financial products with a green or social connotation, all of which placed themselves under the green umbrella. Green is clearly a good selling point. But the question is, when is green truly green?

There is an important distinction between the specifically green funds and the sustainable and ethical security funds2. 'Sustainable investment', it transpires, generally sounds more idealistic than it really is. In the end they are a form of investment which seeks the best possible return. These so-called sustainable funds in the Netherlands (namely, het Andere Beleggingsfonds, ABN Amro Duurzaam Wereldfonds, ASN Aandelenfonds, Robeco Duurzaam Belegginsfonds, ING Duurzaam Fonds and Triodos Meerwaardefonds) invest in the stock-market shares of well-performing companies selected for having the best principles within their industrial sector on social and ecological issues. It is a risky form of investment with generally high returns. The companies whose shares are bought are not bothered about where the capital comes from. In this respect, there is no difference to any other company in the stock-market.

Investing in green funds in the Netherlands (ABN Amro Groenfonds, ASN Groenprojectenfonds, Postbank Groen, Rabo/Rpbeco Groep Groenrente Fund and Triodos Groenfonds) has a very different dynamic and therefore a different value. Money invested is used to lend to companies and ecological projects. Thus projects relevant to the protection of nature and the environment are supported. The funds are concentrated in sustainable energy, organic farming, sustainable housing and the protection of nature and the landscape. In general, these investments - at least in the short term - have a far lower return than securities in commercial enterprises. State policy is aiming to reduce this difference by tax relief on 'green' interest and dividends - but only for those green funds recognised by the State.

Triodos Bank
The Triodos Bank is an independent bank founded in 1980 by people inspired by anthroposophist ideas. Triodos Bank represents so-called 'new banking' in its positive attitude towards the development of sustainable energy sources, organic farming, art and culture and nature conservation. It also offers its know-how regarding co-operative development work. Further, Triodos Bank participated in the foundation of INAISE, an international network of financial institutions active in the social economy.

At Triodos Bank not everything revolves around money3. Important is also given to things which are hard to describe in financial terms. Financial decisions should consider the interests of people and nature. Director Peter Blom states: 'Energy consumption, nature conservation and human rights are not matters of indifference any more, if they ever were.' This influences the way decisions are made about what to finance. Companies and projects have to prove that they are sustainable and support human rights in order to be considered by Triodos.
Over the years the bank has grown substantially. Since 1994 the turnover has increased from 200 million to two billion gilder. The bank has been able to expand and now has branches in Belgium and Great Britain. In the words of Peter Blom, 'more and more people are moved by our principles; plus, investment in sustainability has become more profitable, especially over the last few years - to the extent that we can compete with our conventional colleagues. This also indicates that the environmentally-friendly investment market has matured. In other words, investment in this sector is not only justifiable on principle but also on financial grounds.'

The bank offers its customers several saving options, each of which offers the possibility of donating the interest (or part of it) to a charity of their choice. There are more than 250 institutions and organisations which profit from Triodos's interest policy, from nationally-known organisations such as the AIDS Fonds and Vereiniging Millieudefensie to less-known small, local initiatives. One of the special options is the North-South-plan (Noord Zuid) and its related savings account, which was developed in co-operation with the development organisation Hivos, with the objective of strengthening the independence of companies in developing countries and reducing their dependency on the wealthy North.

Green and sustainability-orientated investors can contact Triodos directly. You will be registered at the certificates and shares issue-point and thus become a kind of shareholder of the bank. Shareholders are invited to an annual conference, but they don't have the right to vote on business issues. This right remains with the board members (Stichting Administratiekantoor Aandelen Triodos Bank) who are elected by the shareholders. The reason for this system is to prevent the bank from being taken over by another financial institution and losing its identity, objectives and independence4. The bank offers two shares funds: the Triodos Meerwaardefonds (value-added funds) and the Triodos Groenfonds (green funds). The Meerwaardefonds invests in the shares of companies which differ in social, ecological and financial attitudes from others. This fund combines a good financial return with social involvement. The selection process is primarily an exclusion process. Companies involved in nuclear energy, weapons deals, trade in animal skins, and the cigarette industry are not considered for investment. Products and services which are sustainable and considered important for society are promoted, for example organic farming, telecommunications, public transport, education, sustainable energy and the health service. Companies in sectors which are not considered sustainable are rated on a special scale. They can only be included if they belong to the top fifty in environmental/social ratings. These assessments are regularly reviewed.

The Groenfonds invests at least 70% of its assets in green projects recognised as such by the state. The top priorities are organic farming and wind energy. Other projects are: alternative technology, nature reserves and sustainable building. The Groenfonds is officially recognised as a 'green institution', so all their dividends are tax-free.
The Triodos Bank also offers a carefully selected insurance package including life insurance and pension schemes. Contributions are invested in the same way as in the Meerwaardefonds, in companies which benefit society. Also, the bank carefully scrutinises its own organisational structure. Since 1995 the annual business report has included a special report on environmental performance.

Algemene Spaarbank Nederland (ASN Bank)
The ASN Bank's mission-statement, outlining its philosophical background, is extraordinarily idealistic: 'The ASN Bank is a company which wants to support sustainability in society and whose economic activities are guided by these targets. Sustainability is promoted by working towards changes that will end certain practices. The negative consequences of certain economic activities are either ignored, creating a future problem, or dumped on the environment, nature or the poor.' 5

The ASN Bank sees money as a tool through which to share the ideals of their customers. To achieve this, the bank invests in companies, organisations and projects which deal honestly and respectfully with people, animals, nature and the environment. The bank invests in wind and solar energy, recycling of resources and in nature projects. Special attention is given to projects in the Third World, health care and public services in the Netherlands, and animal protection. The bank works with organisations that work in these fields.

The bank has its roots in the modern trade union movement. Since its foundation in 1960 an ethical concern has permeated its activities. The bank claims to bring idealism and profit under one umbrella in an acceptable way. To make sure that investments in organisations and projects are idealistic, the bank scrutinises every organisation and enterprise. This is done using criteria which measure the values that characterise a responsible enterprise. Companies involved in nuclear industries, weapons, and bio-technology are definitely excluded, as are those which ignore environmental problems. Companies also have to prove that they promote human rights, if they have branches in countries where human rights are a concern. These companies have to prove that they have social employment conditions. These criteria are not considered in isolation: firms have to score a good result in all of them before the bank is prepared to invest.

ASN Bank is the only bank in the Netherlands which makes its business practices totally transparent. ASN offers various services, savings accounts, shares and mortgages. There are several different savings accounts: ASN Milieusparen (environmental savings) offers the customer the security that their money is invested in nature and the environment, and also offers the option of donating their profits (or part of them) to the funds of organisations active in human rights, animal protection, nature, the environment, health care or development. Typically, money is donated to well-known organisations like Greenpeace, animal charities, Pax Christi, Amnesty International, Astma Fonds Novib, etc.

With shares, customers can choose from various packages, such as the ASN Novib Fonds (share funds which are invested exclusively in the stocks of companies worldwide which are performing well on the stock market, which meet the criteria of ASN). Or there is the Andere Beleggingsfonds (a mixed fund which invests in shares and options) and the ASN Obligatiefonds.

There are two further special funds: ANS Groenfonds, which invests in recognised nature and environmental projects, having the advantage of tax-free profits; and the ASN Novib Fonds which supports small businesses, trade and agriculture in developing countries by offering inexpensive credit. Profits are quite humble but the social value is very high.

The bank is noted for its investment in relatively secure and accepted projects, which makes one wonder to what extent it now provides an incentive to choose an alternative economic path. Bonds (30% of the turnover) come mainly from the State and other banks. Also a large portion (13%) of customer investment, which is 50% of the total turn over, is lent to the Netherlands civil service, the EC, and local authorities. What is left is invested in traditional real-estate (40%), the health service and care for the elderly (17%), and education (4%), and also in other banks such as Nederlandse Gemeenten, the Achmea Hypotheekbank and the Nationale Investeringsbank (13% altogether).6

These credits are not dependent on special conditions. The reason is that all banks are obliged to invest part of their money in securities with the Nederlandskeche Bank. What the banks and the machinery of the State do with the money invested with them from the ANS Bank is not clear.

An outstanding initiative by the bank, in co-operation with Aktie Strohalm, has been the invention of an interest-free fund. This idea certainly challenges one of the basic principles of economic practice. The idea follows an example set by the Scandinavian JAK-Banken. The basic idea is to give no interest on savings accounts, but also to put no interest on loans. It is hoped that this procedure takes away the speculative nature of money. Instead of interest, customers receive points which enable them to borrow the same amount of money. Unfortunately the idea came to nothing because the tax office considered the credit points as taxable assets, which corrupted the principle of the fund.

Ethical investment: a fashion statement, or hypocrisy?
On average the Dutch have 33,000 guilders ( 1 Euro = 2.20371 guilders) in savings accounts. Altogether Dutch households have invested about 100 billion gilder in pension schemes, 220 billion in savings and 320 billion in shares. If all Dutch investors had made different decisions and invested 'alternatively', there would be panic in the financial world.7

Savings means power. Some people are using this power, and the demand for ethical and green shares is rising, though admittedly, some of the government's tax relief accounts for this. It is therefore not surprising that more and more big banks offer ethical and green investment products. Such funds are not only the preserve of customers of the Triodos Bank and ASN Bank.
If a bank wants to be successful in the money game it has to follow the rules set by the Nederlandse Bank. One rule is that savings must only be low-risk investments, because it they are only a 'loan' to the bank and need to be paid out on demand. This is one reason why the ASN Bank and Triodos do have to make some secure and traditional investments. 30% of their capital is processed according to government requirements.8 What the government does with the money is unknown. Its use may be contrary to the customer's convictions, such as for the construction of Betuwelijn, or new motorways.

Is ethical investment a fashion or hypocrisy? On 12 October 2000 the ASN Bank and the ABF (Andere Beleggingsfond) organised a 'Day of Ethical Investment'. The main speaker was Herman Wijffles, formerly a top-level executive of the Rabobank and currently chairman of the SER (Social Economic Advice Commission). He said that there is no going back. Sustainable economics is good practice, is worthwhile, and must continue: 'The only formula with any chance of success is sustainable economic growth which doesn't damage the environment.' One critical aside should be made, however: 'Unfortunately there are as yet no fixed standards; people can just do as they like. In English one speaks of 'people, planet and profit' as the three ingredients which enable a 'richer' calculation of profit and loss than a single-track calculation of financial results. It is called the 'triple bottom line'. Very apt!' 9
Big companies such as Shell, Ahold and Unilever presented themselves very well in their videos, with great PR stories about people and the environment, but no word was said about social issues or human rights in Nigeria (Shell), reduction of air traffic (Ahold) or genetic modification (Unilever).10

X - Y Solidaritaetsfonds
X - Y is an independent funding organisation supporting not only social movements but also small initiatives aimed at political self-determination, social justice and sustainability. The fund has existed since 1968. Since then some things have changed. X - Y  has changed from mainly supporting development aid to an increasingly independent funding organisation which, in the Netherlands, offers funding advice and supports political campaigns worldwide.11

X - Y mainly supports projects and organisations which can't get support elsewhere due to dealing with politically explosive issues which normally don't receive money from government or governmental development agencies. X - Y often acts as a start-up for initiatives which lack strong organisation and have yet to establish themselves. The first step by X - Y is to offer help to set up better organisational structures. It can also be the case that the money requested by such organisations is too small to interest larger funding organisations which aim for a high turnover. In giving out grants to projects X -Y favours small initiatives founded by their members. 400,000 gilder are distributed annually.12
Two things are noticeable about these grants. Firstly, the amounts are very small (500 - 10,000 gilder). Secondly, although the initiatives might differ in many ways, the money given is used mainly for information, campaigning, and raising political awareness.

Examples are: the support of a document on the human rights abuses of Bolivian cacao farmers; a campaign for conscientious objectors to the army in Paraguay; a leaflet on human rights in Serbia; a workshop on globalisation in Russia; a conference for women in the sex industry in Taiwan; the creation of a documentation base on the circumcision of women in Kenya, and the Anti-MAI-Campaign in The Netherlands.

The fund is financed by donations from 2,500 people, plus some inheritances. In the eighties the financial situation was shaky but today it is stable. X - Y is also supported by small base-groups, donor groups in cities, and a club of people who donate the proceedings of their second-hand sales. Altogether X - Y receives donations and gifts of 700,000 gilder per year. 400,000 gilder are given out as grants, about 150,000 gilder are spent on campaigns and financial support for grass-roots groups, and the rest goes on office space, salaries (seven people are employed, two of whom receive their salary directly from the fund), and other administrative expenditure. About forty volunteers support X - Y in its project management and campaigns. These volunteers are recruited from social movements and socially-concerned research institutions. They form a network which can advise volunteers and employees about projects to be supported.

X - Y does more than just support projects. They offer consultation on financial or organisational issues. They publish a guide to funding, describing 150 funds available to grass-roots groups. On top of this, X - Y initiates campaigns and participates in political debate. Politically and practically, X-   Y swims conscientiously against the stream.
X - Y watches economic globalisation closely, as well as the phenomenon that multinationals and economic unions (the World Bank; 'Fortress Europe') can make unchecked decisions and policy without considering citizens. These are commented on and, where necessary directly campaigned against through organisations such as attac.

Mama Cash
Among all the funds, Mama Cash holds a special position: for seventeen years the fund has exclusively supported initiative aim at improving the position of women in society. Mama Cash aims for a just world where people treat one another with respect and show respect to the environment; a world where people care for one another and differences are accepted.13
Mama Cash is a special feminist fund offering and securing micro-loans to new enterprises in the Netherlands, middle and southern Europe, and the South (the Third World). The financial independence and self-determination of women is Mama Cash's chief aim. Special attention is given to 'outsider-groups' such as black immigrants and refugees, girls, lesbians and women with disabilities.

Sustainability is important because the aim is for projects to have a long-term effect. The emphases are: consciousness-raising, enabling, the building of economic independence, and, often, the creation of information centres. Before giving grants, Mama Cash seeks advice via a network of local consultants. They can give information about the political, social and economic context in which the project functions. Marlise Mensink, the fundraising and publicity co-ordinator, says that 'women all over the world work with great courage, co-operation and inventiveness to improve the lives of their daughters, mothers, cousins, friends and neighbours. Mama Cash considers itself part of that community and therefore finances their projects. The agenda of the international women's movement is the agenda of Mama Cash. We don't want to dictate to others how to run their projects or which issues are important. We also think that the economic independence of women is the key to the improvement of their position in society."

A small portion of the donations and gifts goes to serve the fund's own financial needs and is invested in a sustainable way.

Mama Cash consists of different departments, each with their own funds and own criteria for approving applications. The Guarantee Fund specialises in making women financially independent by making the women and their enterprises credit-worthy. This is achieved by securing loans for career-orientated business-women starting out, if such a security is a requirement of the bank.
The Culture Fund gives out small grants and low interest or interest-free loans to projects that make the strengths and varied gifts of women in Holland more visible. The emphasis is on projects which promote the development of critical reflection on issues of gender and ethnicity. A second emphasis is on projects which draw attention to artistic expression, ideas and experience.

The Southern Fund supports independent groups of women in the Third World. Its main concern is to support the setting-up of new groups and projects which promote women's emancipation. The Eastern Europe Fund does the same for the former Soviet states and the newly independent states in Central and Eastern Europe.

The Inheritance Sisters is an independent network of women who have inherited money. The objective is to develop the confidence of these women to deal responsibly with their money and invest it for the benefit of society. Quite recently Mama Cash started a special project dealing with the economic empowerment of women.

Mama Cash can be supported through one-off or regular donations. Another way is to give an interest-free loan to Mama Cash. In recent years Mama Cash has made many appeals for donations, which has increased its budget substantially. A large part of its income is from private donors, and also from established businesses and charities. It is supported by the Dutch NOVIB, Hivos, Coraid, and Stichting Doen (The 'Do it' Foundation), as well as the John D. and Catherine T. Macathur Foundation - one the largest American funds. In 1999 the Dutch government gave a one-off sum.14 Compared to the 'big' funds Mama Cash is not so big. However in 1999, about 3.5 million gilder were given out in the form of donations, loans and securities, in response to about 550 requests.15

Although gender equality is legislated for in most countries, reality tells another story according to Mama Cash. As M. Mensink says, 'in the Netherlands, for example, it's mainly about established structures and a cultural change that is still ongoing. It's no different in the rest of the world. In Latin America, Asia and Africa especially, religion still has a strong influence on political and social discussions about gender roles. Mama Cash wants to try to break down these structures wherever possible."

From the outset, Mama Cash decided to finance small projects coming up from the grassroots of the women's movement. M. Mensink states that 'changes in society often start out from this level and therefore projects on this level deserve support. Grass-roots movements often don't have access to any finance. For a long time we were only able to give out small amounts of money, on average 5000 gilder per project, because we were quite small. Experience has often shown that supporting such women's groups is really worth it, because they're aiming for more than just money in a bank account. Financial support also means moral support. It means recognition of women's work, and it means solidarity.'

Notes
1 Nico Schouten and Karel Glaastra van Loon: Atlas der Macht, update 2000, Papieren Tijger, Breda and Ketch-Up Press, Rotterdam
2 Thomas Steiner: Gruene Geldanlagen, Zeist, Januar 2000
3 Wenn Sie sich fuer eine Bank entscheiden, bei der nicht Geld zaehlt, Triodos Bank, 1999, Zeist
4 Wordt aandeelhouder bij de Triodsbank, Triodos Bank, 1999, Zeist
5 ASN Bank, Jaarverslag 1999, The Hague, 2000
6 Ditto
7 Jeroen Trommelen: Handboek Milieu, Ethisch beleggen, in: De Volkskrant, 23/09/2000
8 Ditto
9 Interview with Herman Wijffels, in Spaarmotief, published by AN Bank, December 2000
10 Jaap Draaisma: Ethisch Beleggen Hype of Hypocrisie? in Solidair News no 2, Utrecht, November 2000
11 Jaarverslag 1998,  X - Y solidariteitsfonds, Amsterdam
12 Ditto
13 Mama Cash, Annual Report 1999, Amsterdam
14 Ditto
15 Ditto