WHILE traditionally regarded as a “non-polluting sector,” banks are now going green and are making the protection of the environment their business.
Aided by a grant of Euro 346,446 (about Php22 million) from the European Commission, the Manila-based Association of Development Financing Institutions in Asia and the Pacific (ADFIAP) yesterday launched the “Green Banking Initiative” to promote environmental governance standards among banks and financing institutions in the Asia-Pacific region. The initiative was funded by the European Commission under its Asia Pro-Eco Programme.
“We are now being confronted with global climate change issues. Some financial institutions that previously found nothing wrong with underwriting millions of dollars for certain sectors like mining, illegal logging and other commercial operations that rapidly deplete the ozone layer, denude forests, deplete water resources, or pollute the rivers have now started paying attention,” said Ambassador Jesus P. Tambunting, chairman of ADFIAP and Planters Development Bank of the Philippines. “Along with governments, civil society and business organizations, banks and financial institutions realized that protecting the environment should also be its business.”
EU Ambassador and Head of Delegation to the Philippines Alistair Macdonald said banks in Asia “have been relatively slow in examining their exposure to the environmental risk and the business opportunities of sustainable development. This is a missed opportunity, both for the environment and business.”
The European Commission’s grant has “paved the way for a greater understanding and awareness of the importance of environmental issues” among banks and financial institutions in Asia-Pacific, especially among ADFIAP’s 83 members spread throughout 37 countries and territories, he added.
“At least sixteen Asian Banks have instituted or enhanced their corporate environmental policies, thanks to the project,” the EU Ambassador said.
Among the major outputs of the 18-month project are the resource and training books that will aid DFIs in the internal application of environmental management policies and practices, and assess environmental risks when evaluating loan proposals from borrower-clients.
With technical assistance from its European partner-organizations, Germany’s UNEP/Wuppertal Institute Collaborating Centre for Sustainable Consumption and Production (CSCP), and the United Kingdom’s University of Leeds and University of St. Andrews, ADFIAP launched a region-wide campaign to strengthen DFI environmental governance policies, systems and procedures. This involved a series of conferences and seminars held in Manila, Mumbai, Hanoi, Bangkok, Beijing, Kuala Lumpur and Colombo, where more than 200 senior executives of DFIs participated.
“When it comes to issues affecting the environment, we have been spared from the controversies and the protests. But the climate has now changed,” said Ambassador Tambunting. “This is the day we in the banking industry start going green.”