Kenya is one of 34 countries that have introduced banking reforms to expand sustainable lending, making emerging markets a major force in driving development and fighting climate change, according to the first comprehensive global progress report of the sustainable banking network, an IFC-supported organization of banking regulators and associations.The report released on Tuesday, underlines several good practices introduced in Kenya, where the sustainable finance initiative guiding principles are endorsed by the national banking association and the Kenyan Central Bank, and include not only environmental and social aspects, but also governance.
A further good practice in Kenya was the introduction of a dedicated website and an e-learning platform to raise awareness about sustainable banking practices, which has been used to train 80 percent of bank employees.
“IFC congratulates Kenya for adopting the sustainable finance guiding principles and ensuring that banks have the capacity and resources to implement them. As one of the few members of the Sustainable Banking Network in Africa, Kenya is demonstrating leadership that will have a positive impact across East Africa,” Manuel Moses, IFC Country Manager for Kenya said in a statement.
Those 34 countries account for $42.5 trillion in bank assets—more than 85 percent of total bank assets in emerging markets.
Some are wealthier than others, but all of them have made progress in advancing sustainable finance. Eight countries—Bangladesh, Brazil, China, Colombia, Indonesia, Mongolia, Nigeria, and Vietnam—have reached an advanced stage, having implemented large-scale reforms and put in place systems for results measurement, the report points out.
Kenya is currently developing a comprehensive sustainable finance initiative covering the entire financial sector.
The report provides practical indicators and tools for countries to apply to their own domestic markets, regardless of their size or stage of development.
Emerging-market countries increasingly are learning from one another as they adopt sustainable-finance policies, according to the report.