Social Commission for West Asia.
banking is a kind of Western
self-imposes restrictions on the types of business activities it engages it.
Whereas most banks will have at least some ethical policies, there is a subtle
difference in the perception of the reasoning behind the decisions. A bank
might declare that it will not invest in an unpopular activity, for example
whaling, even though it would not be particularly profitable to do so anyway.
In such cases the ostensibly ethical stance is arguably a public relations
move, and might be a small positive gesture in a largely unethical whole. There
is also a question as what is ethical. Whereas some people might consider
smoking, weapons manufacture, pornography and livestock farming unethical,
other would disagree; there is almost always a case for an activity serving an
For a bank to declare itself ethical,
therefore, it must set out a ‘manifesto’, or a set of rules based upon its own
ethical standards, and it must then stick to them. It is then for others to
decide whether the bank is ethical, but it would then certainly be considered
unethical to engage in activities that breached its own self-imposed ethical
standards. The ethical banking sector has been compared to Shariah banking, and
the parallels are certainly present. Both have boundaries, within the law of
the land, on the activities that they can take part in, and both have customers
who trust them to obey the standards without having to constantly monitor their
every move (which would be impractical). The main difference is that ethical
banking has a set of rules with are arbitrary and subject to change as the
public’s tastes and tolerances shift, whereas Shariah banking is governed by
rules which are laid down in the scriptures and are immutable, albeit in many
cases open to interpretation. Islamic
banking can therefore be considered of a kind with ethical banking, but it is
as different from the principle as one ethical bank is from another.
inter bank offered rate, a reference
rate based on the rate at which banks offer to lend to each other
in the euro market. It is similar in
that respect to the widely used Libor.
currency of the eurozone, which is not the same as the European Union, as ten
EU countries do not use the euro. The countries that use the euro are (at the
time of writing) Austria, Belgium, Cyprus, Estonia, France, Germany, Greece,
Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia
and Spain. The euro is the world’s largest reserve currency after the US