DESPITE a royal commission exposing a long list of misdeeds by the major banks, Stirling council’s finance staff are advising councillors not to pull investments out of the big two it deals with – yet.
The council has $92.7 million with NAB – by far its biggest investment – and $25.1m with Westpac.
Both were criticised by commissioner Ken Hayne, who said “time will tell” if Westpac will pull up its socks, and NAB got the worst review of the four with the commissioner fearing there would continue to be a “wide gap between the public face NAB seeks to show and what it does in practice”.
Stirling council’s finance staff put together a report for councillors looking at the “implications” of changing their investments away from the banks criticised by the commissioner.
The report said there was no direct impact as a result of the royal commission, but “the indirect, and wider issue, is related to social impact as to who the city chooses to invest with”.
The officer’s report says they now “have the option to move away from those institutions which have been found to have acted below community standards and expectations”.
The report alse noted the commissioner’s view that NAB still seemed unable to grasp “what is the right thing to do”.
But councillors were advised to adopt a wait-and-see approach for now and “monitor” the banks’ responses.
The officers suggested a further report to council if the banks didn’t pick up their game.
The city’s investment policy lists one objective as “socially responsible investment”, but that section only calls out “removing investments… [in] companies that are involved in fossil fuel projects”.
by DAVID BELL