Shane Jones reckons Kiwibank’s board has gone bonkers and I have to agree with him.
If you haven’t caught up on this, Kiwibank seems to have taken it upon itself to be New Zealand’s moral police. It’s released its Responsible Business Banking policy, which bans a whole bunch of industries from doing business with it.
Casinos, fossil fuel producers, the non-medicinal and recreational drugs industry, the military grade firearms industry, predatory lenders, tobacco manufacturers and, bit of a surprise, brothels and strip clubs.
Turns out Kiwibank’s not really that committed to its own stated morals though. The sex industry, quite rightly, objected and Kiwibank, again quite rightly, backed down.
What was Kiwibank thinking? Sex work is legal in this country. Brothels are legal. Kiwibank’s board might not like the industry but it is not its place to start vilifying certain sectors just because a bunch of people around a board table might have a moral objection to a particular way of doing business.
Same thing arguably goes for all the businesses Kiwibank has banned. The majority of them are legal. Liquor shops aren’t outright banned but, can you believe it, are deemed ‘sensitive’ so have to ‘demonstrate good practice’ to earn the right to bank with Kiwibank.
Isn’t that a bizarre situation? That a New Zealand-owned bank is warning it might refuse banking services to Kiwi owners of liquor stores. The only obvious outcome here is that the bank set up to compete with Australian banks, just sends businesses like liquor stores to those very banks.
What’s more, these moral lines seem arbitrary. Liquor stores are out unless they can prove they’re OK, but bars are fine. Casinos are banned, but bars with pokies could be fine. The cannabis industry is out, but the pharmaceutical industry is fine even though pharmaceutical companies are the ones copping huge fines in the US for pushing opioids at kids. Businesses extracting coal are banned, but businesses selling coal are fine.
How arbitrary is that?
It is not the job of a bank to decide goodies and baddies in society. It is the job of a bank to bank.
It is highly ironic that a NZ-owned bank would refuse banking services to Kiwis because it has moral objections to how they earn their coin. It is even more ironic that we’re getting a lesson in morals from a bank.