How ethical is the Co-operative Bank?
In January 2025, Co-operative Bank was purchased by Coventry Building Society and this is reflected in the profile structure below.
Our research explores several ethical issues linked to Co-op Bank, including its climate targets, financing of arms, and positive policies on loans and investments on fossil fuels and factory farming.
Below we outline some of these issues. To see the full detailed stories, and the Co-operative Bank’s overall ethical rating, please sign in or subscribe.
Climate change
Co-op Bank does not finance companies involved in the extraction or production of fossil fuels, stating “We will not provide banking services to any business or organisation whose activity contributes to global climate change or the destruction of ecosystems”.
Its mortgage lending is therefore “the most material contributor” to emissions from its financial services, according to the company, and it has set targets for its mortgage financing to be net zero by 2050.
Nonetheless, Co-op Bank does not appear to have set overall targets for all financed emissions – arguably the most important target for financial organisations to set. Ethical Consumer also considered it to be engaging in misleading messaging by stating "We are proud to have been ‘beyond carbon neutral’ for our operations since 2007”. Its ‘carbon neutral’ claim was based on use of offsetting – a practice that involves buying certificates for carbon removals rather than addressing direct emissions. Ethical Consumer does not consider offsetting to be a meaningful approach to tackling climate breakdown.
Positive lending policies
Co-op Bank has a number of positive lending policies. As well as excluding financing of companies involved in fossil fuel extraction and production, it has several policies relating to human rights and animal welfare.
The bank states that it will not provide loans to companies linked to significant workers' rights abuses, such as use of child labour and violations of the right to join and form trade unions. It has also prohibited services to businesses, organisations and governments that have “business relationships with an oppressive regime".
It also has multiple positive policies on animal rights – which are particularly unusual in this sector. It will not finance companies involved in “the exploitation of great apes”, for example in experimentation or general commercial use, activities that “significantly contribute to the degradation of endangered animal species’ habitats”, or those involved in animal testing of cosmetic or household products, intensive farming methods (e.g. caged egg production), blood sports (e.g. the use of animals or birds in sport to catch, fight or kill each other), and the fur trade or speciality/exotic leather.
Poor policy on financing of arms
Co-op Bank published its first policy against controversial weapons in 1992, but to date has not ended financing of other arms.
The company’s Ethical Policy states that it will not invest in any company that “manufactures or transfers indiscriminate weapons", which include weapons like cluster munitions, antipersonnel landmines, depleted uranium munitions, incendiary munitions, chemical and biological weapons. It also prohibited financing of "products or services classed as strategic to nuclear weapons”, and companies providing armaments to oppressive regimes.
Positive policy on tax avoidance
Coventry Building Society – owner of Co-op Bank – is accredited by the Fair Tax Mark, an independent certifier assessing fair tax conduct. However, as it was only purchased by Coventry Building Society in January 2025, the bank itself had not yet been assessed as of May 2025.
The company’s 2023 annual report indicated that it owned a subsidiary on the Isle of Man, which is considered a tax haven by Ethical Consumer However, as the subsidiary on the Isle of Man was dormant, the Co-operative Bank Holdings Limited did not lose any mark for its tax conduct.
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The text above was written May 2025, and most research was conducted in February 2025.