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History of Sustainable Banking @ Stanford

Stanford’s Role in Culture Change

Stanford University’s School of Engineering has long been a frontrunner in moving from problem to redesign concept to innovation to scaling implementation.  Process analytics, lifecycle cost saving and improving the quality of built, natural and information infrastructures have been a regular pursuit for Stanford graduates, faculty and industry allies.

Banking is Ripe for Culture Change

Banking, finance and insurance are economic infrastructures; what gets financed gets built. 

As the 2008 Financial Crisis demonstrated, banks, financial institutions and insurers (collectively, “banks”) need new transparency tools, bankers trained to use the new tools and a setting in which both tools and bankers can research, design and test a new way of working in the Digital Age so that what gets financed is what the real economy values. 

As concerns for global climate change, energy equity, food equity, healthcare, labor rights and human dignity demonstrate, banks play significant roles in providing capital that improves or degrades regional quality of life, economic prosperity and neighborhood safety.  As the constancy of homeland security concerns domestically and abroad show, threats to quality of life in one part of the world now resonate globally.

As socially-responsible investment proves to be as or more durable during recessions, as cleantech and impact investing move mainstream, and as mPesa pilots lightweight, accessible global financial services, commercial and investment banking lag in safe innovation and a culture of responsible innovation.

How Sustainable Banking Took Root at Stanford Engineering

2011 brought the work of Bruce Cahan at Urban Logic (now a Stanford Visiting Scholar) and Assistant Professor Michael Lepech in Stanford’s Department of Civil and Environmental Engineering together to launch research into reconceiving the technologies and risk models used by banks, financial institutions and insurers, and thus to change the culture of bankers, regulators, customers and community stakeholders.  By 2012, bankers from China, Silicon Valley and everywhere in between began asking “What can Stanford do to research and help us deliver sustainable bank services?”  Beginning in 2013, Cahan and Lepech created a curriculum and research program to explore topics in sustainable banking.

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