BankTrack has published a how-to guide aimed at helping banks become more sustainable.

The Utrecht-based NGO's manual, The dos and don'ts of sustainable banking, is based on the role and responsibility of banks to promote sustainability set out in the Collevecchio Declaration of 2003.

Banks should, for example, change their bonus schemes to emphasise implementation of environmental and social policy and long-term prudence instead of short-term profits.

BankTrack advises banks to ensure that sustainability policies are actually implemented, rather than used as a public relations tool.

International banks are told to engage with emerging banks to improve their standards, rather than just complain that there is an uneven playing field.

Advising investors to put their money into shares that do not meet the bank's own minimum standards is also listed as a "don't" by BankTrack.

"Sustainability for the banking sector requires a lot more than cutting down on your paper consumption or even signing up to the Equator Principles [on project finance]," said Johan Frijns, BankTrack coordinator.

"It involves making hard choices and a willingness to forego business opportunities that run counter to your sustainability mission. Contrary to popular belief there is not always a business case for sustainability; there may simply be pressing moral or social reasons to not get involved in an otherwise financially lucrative deal," he added.

"There is a need for going far beyond the rhetoric that is currently developing around the topic; this manual shows the way forward for any bank wishing to successfully apply for next years' Sustainable Banking Awards," said James Leaton, WWF-UK policy advisor and a member of BankTrack, referring to the awards launched earlier this year by the Financial Times (see Environmental Finance July-August 2006, p32-33).

"The dos and don'ts published by BankTrack provide useful input into the equation and is something that banks will take into consideration when reviewing their environmental policies. Many banks will already broadly follow the majority of these," said a spokesman from the British Bankers' Association.

"There is a fine balance that banks have to draw between the wider impact of lending decisions; the need to encourage development and investment for the overall benefit of a community has to be balanced against the impact of that development on the environment. Some of these decisions can be immensely complex," he added.