The Independent Uganda: You get the Truth we Pay the Price
Kampala, Uganda | THE INDEPENDENT | The Ministry of Finance, Planning and Economic Development has urged financial institutions to create financial products that are in line with the protection of the environment, social support and transparency.
The Permanent Secretary and Secretary to the Treasury Ramathan Ggoobi says this is because the way of doing business is changing globally as both the consumers, producers and financiers focus on sustainability.
Ggoobi was speaking at the 7th Annual Bankers Conference, organized by the Uganda Bankers Association and the financial institutions in Kampala. He assured the industry of the economy’s strength and the ability to sustain the current 6 percent growth, but added that measures have been put in place to ensure double digit growth figures.
He, however, says that growth where businesses are based on adherence to environmental, social and governance (ESG) practices is what will lead to the transformation of the country, adding that the challenge is now for the financial industry to comply.
Earlier this month, the Bank of Uganda launched the ESG Framework, a document that provides guidance to the financial industry on how to conduct sustainable business.
The framework, developed jointly with the Association, is aimed at ensuring that all the institutions move at the same pace and in the same direction towards achieving this global goal.
The framework also guides banks on creation of structures to support ESG, securing and allocating human and financial resources, building the capacity to implement ESG activities and the type of products or services on offer, among others.
At the end, the long-term objective is to ensure that ESG becomes the normal routine of the financial industry, which Bank of Uganda says, helps the nation and the global community to protect the world from adverse climate change effects.
Representing the Deputy Governor at the conference, the Executive Director Supervision, Twinemanzi Tumubweine promised the financial institutions that the central bank is finalising guidelines that will protect the industry against risks that may arise from the ESG framework.
Under ESG Business, including the financial sector, practicing ESG introduces and continuously improves measures that ensure that their activities will protect or not harm the environment and the communities around, as well as observe transparency and avoid corruption.
For the financial industry, for example, lenders will be compelled to ensure that their credit facilities are given out after ascertaining that the project funded promotes or does not harm the environment.
Julius Kakeeto, the Chairman of Uganda Bankers Association said that as providers of credit for development, the banking industry was in position to lead the journey towards sustainable growth and development.
The Annual Bankers Conference has, for the seventh time, been sponsored by digital financial solutions company, Mastercard.
Shehryar Ali, Mastercard Country Manager for East Africa appealed to the business community to think about the future generation when carrying out their businesses, in the wake of escalating climate change effects.
“I urge you all to close your eyes and envision a future through the eyes of your children, the young ones, and those to come, the future that awaits them, only then will you see the relevance of the ESG,” said Ali.
“Ponder, ‘how are we presenting a world, and will it be worth it’,” he said, adding that exclusivity was very essential on the global stage. Minorities to be heard on a global platform, get women woos and challenges heard and voiced on a global front. Sustainability cannot work if these voices aren’t heard, if we’re to have sustainable growing companies, we can’t shy away from these ESG practices.”
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