Welcome to this newsletter from the Customer Union for Ethical Banking, the independent union for customers of The Co-operative Bank and Coventry Building Society.
In this month’s newsletter we take a look at the Group’s recently published Sustainability Report, and find that progress could be better in a few key areas.
First Coventry Group Sustainability Report published
Since our last newsletter, the Coventry Building Society published its first “Group Sustainability Report” – the first to cover both the Building Society and the Co-op Bank. You can download it here. Let’s take a look at what it has to say:
Ethical Policy declines down
The first thing we always look for in the bank’s Sustainability Report is the Ethical Policy reporting. It’s this reporting of business turned away for ethical reasons (rooted, let’s not forget, in customers’ views) that sets the bank apart. And we’re pleased to see this Coventry-led report keeps to the same level of reporting on the Co-op Bank’s Ethical Policy as in previous years.
The report also shows that the merged organisation clearly sees the importance of the Ethical Policy, setting it alongside the Building Society’s B-Corp status as part of the “blueprint … guiding the way” for the Group’s sustainability agenda.
However the actual number of businesses turned away for ethical reasons in 2025 is at its lowest in a decade - just three businesses out of 297 referred for screening. These were “two consultancy businesses providing strategic services to support the oil and gas sector” and “a business involved in the mining industry”. (The bank’s Ethical Policy does not say no to all mining, but no further detail is given as to why this company was considered unsustainable.)
We spoke to representatives of the bank about this at our quarterly engagement call last month. They claimed that most customers understand the Ethical Policy well enough and that they “self-select” – i.e. customers in unethical sectors don’t approach the bank as they know they will be turned away. But if we look back to 2011 or 2012, the last years the bank was owned by the Co-op Group, the number of declines were 35 and 42 respectively.
We think awareness of the bank’s Ethical Policy may not be able to explain such a big change, and we’re worried that maybe the bank is not doing the job as well as it used to. But there is one thing the bank could do that would go a long way to reassuring us.
Audit the Ethical Policy!
We’ve been calling on the bank to bring back external auditing of Ethical Policy decisions by a specialist sustainability auditor, as happened before 2012. Two years ago, the bank told us: "we accept the Customer Union's challenge regarding independent review of our Ethical Policy screening and we want to reassure members of the Customer Union that we have started making some steps towards reinstating this and commit to providing more information when we are able to do so." However, this was before the merger, and we haven’t had an update since.
We’re delighted the bank is back in mutual ownership, and that Coventry sees the bank’s Ethical Policy rightly as part of its Sustainability Blueprint. The opportunity now is to bring back external auditors so we can trust that the policy is properly implemented, and that our money is not going to unethical businesses that might be slipping through the net.
A step backwards on climate standards?
Last year we expressed hope that Coventry's more ambitious climate standards – including a 2040 net zero target – would be applied to the Co-op Bank. The opposite has happened: rather than the bank being lifted to the Society's 2040 commitment, the combined group has adopted a 2050 net zero target, citing "the scale and complexity of our combined activities." The justification given is that 2050 aligns with government commitments and the Paris Agreement. However this should set a floor, not an ambition.
The Group is also behind on its commitments to develop a robust Net Zero Transition Plan, which it committed to start in 2024. Now it has a 2026 target to “work towards developing an interim reduction target”, with a focus on financed emissions, and admits that its goal to “Set a Group interim net zero target during 2026” is “Not on track”. There’s an urgent need for Coventry to make sure its brands’ climate leadership stands out, though its honesty about the problems it has faced is commendable.
Good stuff that caught our eye
- The Group’s more direct Scope 1 and 2 emissions are down 62% compared to 2021.
- The whole Group sends zero waste to landfill and sources 100% of energy from renewables.
- The Group is offsetting carbon emissions through support for UK-based home retrofits, which also helps tackle its main source of financed emissions – its mortgage portfolio (though more data on this would be nice).
- 2025 marked 10 years of the bank working with Refuge to tackle domestic abuse, and now offers 10 days' paid leave plus emergency accommodation funding for affected colleagues as well as educating customers and supporting helplines.
- The Group's 2025 Sustainability Report highlights continued support for the co-operative movement: sponsoring Co-op Congress in Rochdale for the fifth year, backing Co-operatives UK's Business Support programme (52 co-ops helped in 2025, 4,000+ since 2016), and partnering on a pioneering apprentice housing pilot in Manchester.
Let us know if you have your own observations or questions about the bank’s reporting – and we’ll be continuing to push for improvements in target-setting and accountability in our quarterly meetings.
Bank's reply
We shared a draft of this newsletter with the bank. A spokesperson from the Co-operative Bank said:
""We remain committed to upholding our Ethical Policy. Whilst we don't have control in relation to the types of businesses which apply to become customers of the Bank, we believe that changes in the number of declines are due to a combination of factors including increased awareness of the Policy and a shift in business strategy in recent years to focus on SMEs who are generally less complex and more likely to comply with the commitments within our Policy."
"We are in the process of reviewing our sustainability reporting processes and this review will include consideration of the level of assurance provided. We can provide a further update as this review nears completion in the second half of the year."
"We are committed to ensuring a just transition to net zero, driving change that benefits everyone. This means reducing emissions but also ensuring that the pace of change is realistic, fair, affordable, and does not disadvantage communities or businesses. Our 2030 commitment, retrofit investment and interim targets demonstrate early action already underway. We'll continue our engagement with mortgage customers to support home energy improvements and ensure our corporate lending continues to align with strong ethical standards."
That’s all for this month’s newsletter; thank you as ever for reading and for supporting the Union.
With best wishes
The Customer Union team
Have you joined the Customer Union yet? It costs £15 a year to be a member of the first ever customer union co-operative, and help us ensure the Co-op Bank sticks to its principles. We also welcome Coventry Building Society members. It only takes a few moments to sign up here.
This version of the newsletter was modified following clarification from the bank on the integration process and timing.
