From financing change to changing finance with Peter Blom and Till Kellerhoff

From Financing Change to Changing Finance

Today’s financial system extracts value from natural, human, and social capital while increasing the gap between rich and poor. This has significantly shifted the interaction between financial and economic systems from ‘finance supporting the economy’ to ‘the economy supporting finance’.

In this episode, Till Kellerhoff, Program Director at The Club of Rome, speaks with Peter Blom, former CEO of Triodos Bank, member of The Club of Rome and chair of the Club of Rome Rethinking Finance Hub, about the urgent need to transform the financial system. They explore the transition from financing sustainable projects to changing the financial paradigm itself, the concept of financialisation, and how it impacts the real economy, ecological health, and social equity, as well as the possibilities and obstacles in achieving these transformations.

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Full transcript:

Till: Welcome to the Club of Rome Podcast, exploring the shifts in mindset and policy needed to transform the complex challenges we face today. My name is Till Kellerhoff. I am Program Director of the Club of Rome and leading the Reclaiming Economics Impact Hub. I am very pleased to welcome today Peter Blom. Peter is the former CEO of Triodos Bank, which won the Financial Times sustainability bank of the Year award in 2009 and has become a global reference for value based banking. Peter also founded the Global Alliance for Banking on Values in 2009 and was the chair of the board in 2021.Alongside many other things, Peter is a member of the executive committee of the Club of Rome and Chair of the Rethinking finance Impact Hub, which aims to contribute to the evolution of the financial system so it can serve the transformation of our economy to achieve human well being within planetary boundaries. Welcome Peter.

Peter: Thank you for being here.

Till: Thank you for joining. And let's start with a general question on the Club of Rome to which you became a member in 2015. What motivated you to join the Club of Rome back then?

Peter: Well, what motivated me to join was actually the invitation I got, and I was very surprised by that. And what I was surprised of that people said to me from the Club of Rome, you're relatively young. I just had then become 50, but anyway, you have a good track record, so we are very happy to have you in the club. So that was I felt very honored as an as a useful new member to the club, and really was happy that I could contribute to the to the thinking of the Club of Rome. What in that time, was not so exposed anymore as it was in 1973 when I read as a very young guy, this first book, Limits to Growth. But I've seen in the last, I would say, decades two decades, that there has been an increasing interest in the Club of Rome thinking. And that we are very doing very well in transforming this idea of limits to growth, so a more system change approach what is needed today and tomorrow.

Till: Very good. And you mentioned the Limits to Growth, already published in 1972 by a group of MIT researchers, and the Limits to Growth spoke about the material limits to growth on a finite planet. Now your background is in banking and finance. What is the connection of finance and the financial system to this boundaries of growth on a finite planet?

Peter: Yeah, actually, if you look back at this report, it's it's quite a linear approach. It's not a circular approach at all. It's a quite linear approach. But first we had to be more conscious and aware of the linear limitations of our system before we could really think about the circular approach we need today. And in banking, it's very important, and finance very important that you don't look only to the next two or three months, although that happens more and more in banking, but the next 5 to 10 years. So limits to growth, what is possible, how you can grow your business in a sustainab