1. Monitoring financial and social conduct
Wes, Frank, Mikael, Rod

2. The case Co-operative bank (UK) will not invest in: Questions…
Fossil fuels or unsustainable resources
Unnatural chemicals
Arms trade
Thinks other banks have a responsibility to follow suit
Believes that social/environmental reporting is as important as financial reporting
Questions…
Is the Co-op bank acting ethically?
Are the other banks unethical?
Should financial accounts include social measures?
Who should audit social/environmental behaviour?

3. Hierarchy of obligations
Fundamental
Human rights
Indisputable fundamentals of ethics
Legal aspects
Indisputable fundamentals of (the host) society
Manage money well
Indisputable fundamentals of business
Desirable
Fairness / taking into consideration the interests of (outside) stakeholders (Customers / employees / suppliers / community / …)

4. Is the Co-op bank ethical or not
Co-op is acting ethically…
Respects fundamental moral obligations and seeks to fulfil desirable moral standards
it is reflecting the interests of customers and depositors
Has clear public position and acts accordingly
Is not a monopoly so has no universal obligation
Found market niche that respective customers / investors appreciate (differing ethical awareness)
…but other banks are not acting unethically
Respects fundamental moral obligations
Other banks are looking after the needs of shareholders and depositors
No difference between behaviour and public position

5. Should accounts include social measures?
One argument – they already do
Goods
cash
Assets
liabilities
Plus costs of scarce resources
Labour
Tax / land
Water / electricity
Pension and redundancy
Training & Health
Record
keeping
Balance sheet
Resource costs added through society / Government actions
Modern
P&L

6. Triple bottom line is a departure
Plus of scarce resources
CO2 / Air
Waste / recycling
Social impact
…etc
Auditing
P&L now
P&L future
Accountants
P&L now
Accountants
Triple bottom line reporting
Qualitative social
Consultants
Pressure groups
NGOs
Qualitative environment

7. Pros / Cons Triple line reporting  Co-op worse off
Pricing externalities
 Co-op better off
Pure financial figures remain most important measures
Desirable moral standards not measurably / objectively / comparably taken into account
Supports sticking to fundamental obligations
Stakeholder desirable values discretionary
Financial figures reflect how effects of firm’s behavior is valued by society
 Aligns individual / company incentives with society’s desirable values