US banking inches closer to ESG alignment
JPMorgan Chase to stop financing private prisons; Aspiration shows values-based banking model.
Aspiration’s chief executive and co-founder Andrei Cherny
In March, JPMorgan Chase announced it would stop financing GEO Group and CoreCivic – the largest operators of private prisons and immigration detention centres in the US. The decision follows months of protests from customers and activists outside bank branches, and even CEO Jamie Dimon’s Manhattan home. Other large banks that finance private prisons, such as Bank of America and Wells Fargo, are expected to follow suit. Wells Fargo, for example, has said it will be reducing its financing to the sector.
The move has been received positively by social activists who oppose a system in which prisons are financially motivated to have people incarcerated. Indeed, according to a report in the Washington Post, $25 million has been spent by the private prison industry lobbying for harsher sentences over the last 30 years.
That JPMorgan Chase has altered its finance policy around private prisons when it has remained silent on financings around guns and pipelines, for example, is being seen as a signal that the bank may be becoming more open to reviewing the impact of its balance sheet on society. Although