The money you keep in the bank doesn’t just sit in a vault with your name on it until you walk up to a cash machine. Banks use it for other purposes such as to make loans and investments – far too often to companies and projects that damage the environment and society.
One of the most significant steps you can take as an individual to fight climate change and help create a better, safer, more sustainable world is to move your money to a provider that shares your ethical values.
Here, we round up the top five LEAST ethical banks (which between them hold a massive market share of 63 per cent of all UK banking customers). Rather unsurprisingly, many of the same names appear in our exposure of those offering customers the lowest savings rates.
We also show you below where to move your money for Good – the good of the planet, society and your pocket.
Barclays boasts the most popular current account in the UK – but it’s also the most unethical.
The high street giant’s record on the environment is so poor, it is dubbed the “dirtiest bank in Europe” by campaigners.
Between 2016 (after the landmark Paris Agreement on climate change was signed) and 2022, Barclays sunk more than $190.5 billion (£148.4 billion) into oil, coal and gas projects. This makes it the UK and Europe’s highest financier of fossil fuels, according to the Banking on Climate Chaos 2023 report.
From 2015 to 2020, Barclays provided $132 billion (£105 billion) for oil and gas drilling in the Arctic – one of the world’s most sensitive and important habitats. It is the seventh-largest global funder of tar sands and the biggest in Europe. In April 2023, Barclays finally committed to scaling down its investment in tar sands following intense pressure from shareholders. However, it came under fire for failing to update its oil and gas policy.
Research by Ethical Consumer magazine also highlights ethical issues with Barclays’ approach to animal rights, human rights, workers’ rights, arms and military supply, political activities, anti-social finance and tax conduct.
2. HSBC (including First Direct)
HSBC has the highest gender pay gap of all the UK banks. Women at HSBC earn on average just 54.8p for every £1 paid to male colleagues, according to the company’s 2022 gender pay gap report.
Earlier this year, HSBC was found to be complicit in human rights abuses against Hong Kong residents by siding with Chinese authorities and denying pension payouts to those who fled the authoritarian crackdown. The bank has also been criticised for having links to the Myanmar military.
HSBC has long been one of the world’s biggest financiers of fossil fuels. From 2016 to 2022, it funded fossil fuel companies to the tune of $144 billion ( This includes contributing $55 billion to some of the world’s “most devastating fossil fuels projects” such as oil and gas extraction in Argentina’s Vaca Muerta region. Last year, following long-running investor pressure, HSBC made a landmark announcement that it will no longer finance new oil and gas fields.
However, it still has a long way to go. According to Ethical Consumer magazine, HSBC also has a poor record on deforestation, executive compensation, lobbying, tax conduct, and investments.
3. Lloyds Bank
From 2016 to 2022, Lloyds bank funnelled around $15 billion (£11.9 billion) into fossil fuel companies. In October 2022, Lloyds pledged to stop financing fossil fuel ‘projects’ but made no such promise for fossil fuel ‘companies’.
This means that Lloyds may stop financing some oil rigs in regions like the Arctic ocean or Antarctica territories, but will still finance companies whose whole purposes is building and operating oil rigs in exactly those same places. Banks like Lloyds sometimes use ‘project’ divestment pledges like these as a first half-step to more meaningful commitments – but they have zero material impact.
According to Don’t Bank on the Bomb, Lloyds Bank invested $2.27 billion (£1.76 billion) in five companies that manufactured nuclear weapons between January 2020 and July 2022.
Lloyds has also been heavily criticised for excessive remuneration for its top directors. In 2022, the company’s highest paid director received over £1 million in total compensation. The group’s CEO, Charlie Nunn, received a total of £3.767 million.
From 2016 to 2022, Santander financed the fossil fuel sector with $51.1 billion (£39.8 billion).
Santander is listed by Amazon Watch as a leading financier to mining companies that encroach upon Indigenous lands in Brazil, particularly in the Amazon rainforest. From Jan 2016 to October 2021 it gave $392 million (£305.6 million) in underwriting to Anglo American, Glenore, Minsur and Rio Tinto. It also had $191 million of shareholdings in Anglo American, Rio Tinto and Vale.
According to Don’t Bank on the Bomb, Santander invested $4.8 billion (£3.74 billion) in six companies that manufactured nuclear weapons between January 2020 and July 2022.
Santander is also criticised by Ethical Consumer magazine for excessive remuneration of its highest-paid directors, its ethical approach to animal rights, tax conduct, lobbying and investments.
5. Natwest/ Royal Bank of Scotland
According to the Banking on Climate Chaos report 2023, Natwest invested $16.98 billion (£13.24 billion) in fossil fuels between 2016 and 2022.
Earlier this year, Natwest pledged to stop funding new customers looking to finance fossil fuel projects and will look to stop financing existing customers by the end of 2025.
However, it still has a long way to go.
According to Don’t Bank on the Bomb, Natwest invested $2.03 billion (£1.79 billion) in six companies that manufactured nuclear weapons between January 2020 and July 2022.
Natwest has also been criticised by Ethical Consumer magazine for excessive remuneration – in 2022 its highest paid director was paid £5.25 million – as well as its ethical approach to animal cruelty, tax avoidance strategies, and anti-social finance.
Where to move your money for GOOD
Ethical banks and building societies avoid investing in environmentally harmful or otherwise unethical industries, treat their staff and customers fairly, and pay their share of tax. The gold standard in ethical banking is Triodos Bank, which goes further than simply avoiding the bad stuff – it only invests your money to make a positive impact on the planet and society.
For ethical current accounts, we also like Nationwide Building Society, Cumberland Building Society and Engage, as well as digital challengers Starling and Monzo. A recent report by Which? named Nationwide, The Co-operative Bank and Triodos as their Eco Providers. It found they have no exposure to fossil fuels in their banking activities.