New report on FinTech’s ethical and sustainable growth

By Gaia Lamperti

Rather than simply admonishing FinTechs to become more sustainable, the industry should offer advice, inspiration and real-world best practices to really move the needle towards a more responsible financial technology ecosystem, as the rules of business keep changing.

While in previous decades the single goal of business leaders has been to maximise shareholder returns, new paradigms such as ESG and stakeholder capitalism mean that a balance must be struck between profits and other concerns that fall under the rubric of ‘sustainability’.

Sustainability Superheroes: a how-to guide to ESG for FinTechs is a new whitepaper issued by The Payments Association, (previously the Emerging Payments Association) that aims to become a how-to guide to ethical and sustainable growth (ESG) for the FinTech industry.

Collecting insights from leading ‘sustainability superheroes’, such as Charlie Bronks, Head of ESG at Crown Agents Bank; Irene Perez, Head Of Marketing at Gain The Lead; and Jim Colvine, Senior Vice President, Priceless Planet at Mastercard, the paper uses case studies from major companies like Mastercard, FIS and Algbra to demonstrate how different companies have addressed sustainability in their business.

“Now more than ever before, people want to make more environmentally sustainable decisions and that extends to the brands they do business with. We’re pleased our report not only outlines the ways in which companies can become more ethical and sustainable but also that it shows that the majority of companies have already started down that path,” commented Tony Craddock, Director General at The Payments Association.

The project is anchored in data from The Payment Association’s members on their own ESG priorities, which show that the industry is making significant progress towards embracing sustainable practices and ethical goals:

• Over 90% of companies measure progress towards gender equity
• 80% consider the social justice impacts of their products and services
• 60% seek to reduce waste from their supply chain
• 60% have identified their ESG stakeholders and prioritised them

Of course, the definition of sustainability varies widely and ethical goals are hard to pin down (maximising shareholder returns is arguably an ethical commitment, for example), but the results show that the FinTech industry is making major strides toward integrating these ideas into its day-to-day operations.

Jim Colvine, Senior Vice President, Priceless Planet at Mastercard, said: “Increasingly, people are recognising that the things we produce, buy, and consume matter to our planets’ environment. Covid-19 only heightened these concerns, and now more than ever people want to make a positive, sustainable impact on the world.”

“It’s extremely encouraging to see the FinTech industry recognise this. With most companies already showing that they’re on a path towards being more environmentally and ethically focused, it’s clear that progress is being made. At Mastercard, we’re making headway by having a robust portfolio of environmentally friendly solutions, including our Carbon Calculator, developed with Swedish FinTech Doconomy, which makes it easy for consumers to understand their carbon footprint, and our Sustainability Innovation Lab brings together innovators and customers to design climate-conscious digital solutions. It’s our responsibility as an industry to meet the expectations of our consumers and ensure sustainable goals are being set and met, for the planet’s sake,” Colvine added.