Triodos Bank Business Model: Creating Value
- A values-based bank, enabling people to use money consciously to create a healthy society with human dignity at its heart
The Triodos essence
- Skilled co-workers motivated by mission
- Expertise in social, cultural and environmental sectors
- Supported by specialist training and development
- Regular reflection sessions
- Engaging in two-way dialogue with stakeholders
- Finance from like-minded customers who choose to use their money positively
- Fair, mid-market returns to attract loyal, values-aligned customer
- Our mission fully integrated in our strategy
- Only financing sustainable enterprises in the real economy all of which we publish openly
- Meaningful, human relationships with customers
- First bank, offering comprehensive sustainable products and services
- Financial resilience including high capital ratios
- Managing risk, balanced growth (targeted loans to deposits ratio of 65–70%)
- Offering fair financial returns with sustainable impact
- Acting as a reference point for sustainable banking through our own sustainability, innovation and leadership
Financial resilient, sustainable and impact focused
- A positive contribution to the healthy development of society
- Supporting a community of interest to bring about social change
- Enabling values-driven entrepreneurs to fulfil their potential
- Transparent finance so stakeholders see how money is used
- Finances for sustainable and inclusive enterprise
- Development of a sustainable,circular economy
- Fair Return on Equity (target of 3-5% in 2016)
- Leverage ratio of at least 8% ensuring resilience
- Developing compelling visions for the future of finance
Triodos Bank business model in brief
Our business model and value creation process is illustrated in the diagram above.
Our business model transforms capital inputs – such as the skills and entrepreneurship of the people within our organisation and money from customers, via our core products and services, into value outputs – such as making a positive contribution to the development of a healthy society.
To make this financially viable, we offer fair (but not inflated) interest rates to savers and aim for reasonable long-term returns for investors both in our funds and in Triodos Bank itself. We use these deposits to lend to sustainable entrepreneurs working in the real economy, so they can deliver real impact.
In order to lend to sustainable enterprises we aim to use deposits rather than borrow from other banks. And we aim to deliver a healthy balance between loans and deposits so we’re able to mobilise as much of our deposits as possible. We also maintain healthy levels of capital, well above regulatory requirements. This makes us more resilient over the long-term. Triodos Bank develops through cycles of reflection and dialogues between our inner essence as an organisation and our interaction with society’s evolving needs.