The Banking Association South Africa (BASA) has officially endorsed the Principles for Responsible Banking, which set out the global banking industry’s role in helping to meet the objectives of the United Nations Sustainable Development Goals (SDGs) and the 2015 Paris Climate Agreement. The SDGs aim to address 17 of the most perilous challenges facing society, including eradicating poverty, developing infrastructure and broadening economic inclusion.
The principles are the result of a partnership between the United Nations Environment Programme Finance Initiative (UNEPFI) and banks across the world. BASA is the first banking association in Africa to officially endorse these principles.
The six Principles for Responsible Banking are:
- Alignment. Banks business strategies should align with society’s goals as expressed in the SDGs, the Paris Climate Agreement and other international frameworks.
- Impact. Working to continuously increase the positive impacts of financing, while reducing any negative effects.
- Clients and customers. Working responsibly with clients and customers to create shared prosperity for current and future generations.
- Stakeholders. Consult, engage and partner with relevant stakeholders to achieve society’s goals.
- Governance and targets. Implement commitments through effective governance and setting targets for the most significant impacts.
- Transparency and accountability. Commit to transparency and accountability for banks contribution to society’s goals
The principles enable banks to make sustainability part of their operations and help identify where they can make the most meaningful contributions to society. This will enhance the mutually beneficial relationship between society and banks.
Of the 30 global founding banks who embarked on this initiative, two are South African: FirstRand and Standard Bank. The principles are particularly relevant for South Africa, which faces profound socio-economic challenges and is one of the country’s most vulnerable to climate change. BASA has embarked on a Positive Impact Finance project with its members to further define how banks can contribute towards the achievement of the SDGs and the National Development Plan (NDP). The project will, over time, seek to establish a dashboard that will illustrate priority areas for banks, where their lending is having a positive impact on society. Individual banks may choose to focus on other SDGs.
The Principles for Responsible Banking will be officially launched on 22 September 2019 during the United Nations General Assembly, where they are expected to be endorsed by more than 100 banks from across the globe.
“The Banking Association South Africa is delighted to announce our formal endorsement of the UNEPFI Principles for Responsible Banking. The principles align with our objectives of making banking sustainable, profitable and better able to contribute to the social and economic development and transformation of the country. We, together with our members, reaffirm our active commitment to the much-needed sustainable transformation agenda,” says Cas Coovadia, Managing Director of BASA.