Swedish Banks and Sustainability

Sweden, despite currently ranking second place on the 2019 Sustainable Development Goals (SDGs) Rankings [1], also faces many challenges regarding investments by private banks and pension funds. Dirty investments have a multitude of impacts on sustainability, ranging from social issues to environmental issues, many of which are interconnected with one another. 

We have listed some case studies that put such problems in the spotlight:

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1. Swedish banks and fossil fuels:

   • Seven of the largest banks invest close to double of saver’s money into fossil energy compared to renewable energy

   • In 2016 and 2017, SEK 44.2 billion were invested into fossil energy and only SEK 9.8 billion in renewable energy

   • Largest investments in fossil energy were by Nordea (SEK 15.5 billion) and Swedbank (SEK 9.8 billion)

   • The seven banks still lack clear targets to reduce investments into fossil energy and increase investments into sustainable energy

   • They lack transparency on their climate action measures [2].
     
     

2. Swedish banks, pension funds, and the war for oil:

   • Between 1997 and 2003, Swedish oil company Ludin was extracting oil in southern Sudan during a civil war

   • Increasing international investments in oil intensified conflicts between the Sudanese government and rebels occupying oil fields, leading to thousands of civilian deaths and tens of thousands of people being displaced

   • Currently, seven of the biggest Swedish banks and government pension funds own SEK 3.6 billion worth of Lundin shares [3].
     
     

3. Swedish banks and fast-fashion

   • Many banks are part owners of unsustainable fast-fashion chains like H&M

   • H&M is one of the largest fashion retailers worldwide and the largest buyer of clothing produced in Bangladesh

   • The Bangladeshi employees (80% are women) struggle to sustain their lives on the full-time salary

   • This is a serious human rights and women’s emancipation issue

   • Cheap production costs encourage a unsustainable consumerist, fast-fashion culture

   • Despite being part owners, banks are passive about the issue [4].

Considering the three case studies listed, it is clear that Swedish banks are contributing to an array of global sustainability issues. The banks are exporting their unsustainable practices abroad. The actions of banks in Sweden are having negative social and environmental consequences globally, especially for those who are most vulnerable. Furthermore, the lack of transparency by banks makes it difficult to hold banks accountable for their actions and difficult for account holders to know how their money is being used.