Almost half of the global emerging market economies to have initiated key financial marketsreforms to drive development and fight climate change are in the Asia-Pacific region, according to the second Global Progress Report of the IFC-facilitated Sustainable Banking Network (SBN). These reforms require banks and other financial institutions to assess, manage, and report on environmental, social and governance (ESG) risks in their lending operations and put market incentives in place forbanksto lend to green projects.
Of the 38 countries that make up the SBN, 16 are in Asia-Pacific, displaying a commitment within the region to sustainable finance and industry innovation. Ten Asia-Pacific economies have adopted national sustainable finance policies and voluntary principleswhile China and Indonesia are the only two nations globally to have progressed their sustainable financial systems to a maturing stage.
The report also captures the progress made by 14 countries globally to actively grow their green bond markets; and data shows increasing innovation by financial institutions to green their lending portfolios. Across Asia-Pacific, seven SBN member nations have issued green bonds.
“SBN members have demonstrated thattransforming financial markets toward sustainability is possible,” said vice president of IFC, World Bank Group Georgina Baker. “Emerging markets are on the forefront of this shift – and SBN’s tools and guidance have laid the groundwork for more countries to follow suit.”
In addition to providing practical resources for countries undertaking sustainable finance reforms, the report also highlights the peer-to-peer knowledge sharing of SBN members – a hallmark approach of the network.
“The report captures the real-world experience of SBN members to develop sustainable finance,” said deputy commissioner of International and Research, Indonesia Financial Services Authority (OJK), and a co-chair of the SBN Measurement Working Group Imansyah. “Sharing lessons and knowledge among members has been an important catalyst to drive finance reforms, particularly as countries embark on these efforts.”
“Ultimately, SBN is about collaboration,” said deputy director-general of China Banking and Insurance Regulatory Commission and co-Chair of SBN Measurement Working Group Ye Yanfei. “By bringing together regulators, policymakers, trade associations and development institutions, SBN has been able to not only turn sustainable finance policies into action, but also strengthen measurement to capture market impact.”
Building on the collaborative framework, the SBN has also set up a taskforce to provide tailored support to help the region’s poorest countries, including Mongolia,Bangladesh, Nepal, Cambodia, Pakistan and Laos to overcometheir barriers to developing sustainable banking policies.
Established in 2012, SBN now represents $43 trillion (86 per cent) of banking assets in emerging markets. The report is based on an innovative results-measurement approach developed by SBN members as they work to convert sustainable finance policy reforms into practical implementation and behavior change across the banking sector.
Establishing in 2012, SBN is a voluntary community of financial sector regulatory agencies and banking associations from emerging markets committed to advancing sustainable finance. The first global network of its kind focused on sustainable finance at market level, SBN represents 38 countries and $43 trillion (86 per cent) of the total banking assets in emerging markets. SBN members are committed to moving their financial sectors towards sustainability, with the twin goals of improved ESG risk management (including disclosure of climate risks) and increased capital flows to activities with positive climate, environmental, and social impact. IFC is secretariat and technical partner, assisting members to share knowledge and access capacity building that helps them design and implement national sustainable finance initiatives.
Of the 38 countries that make up the SBN, 16 are in Asia-Pacific, displaying a commitment within the region to sustainable finance and industry innovation. Ten Asia-Pacific economies have adopted national sustainable finance policies and voluntary principleswhile China and Indonesia are the only two nations globally to have progressed their sustainable financial systems to a maturing stage.
The report also captures the progress made by 14 countries globally to actively grow their green bond markets; and data shows increasing innovation by financial institutions to green their lending portfolios. Across Asia-Pacific, seven SBN member nations have issued green bonds.
“SBN members have demonstrated thattransforming financial markets toward sustainability is possible,” said vice president of IFC, World Bank Group Georgina Baker. “Emerging markets are on the forefront of this shift – and SBN’s tools and guidance have laid the groundwork for more countries to follow suit.”
In addition to providing practical resources for countries undertaking sustainable finance reforms, the report also highlights the peer-to-peer knowledge sharing of SBN members – a hallmark approach of the network.
“The report captures the real-world experience of SBN members to develop sustainable finance,” said deputy commissioner of International and Research, Indonesia Financial Services Authority (OJK), and a co-chair of the SBN Measurement Working Group Imansyah. “Sharing lessons and knowledge among members has been an important catalyst to drive finance reforms, particularly as countries embark on these efforts.”
“Ultimately, SBN is about collaboration,” said deputy director-general of China Banking and Insurance Regulatory Commission and co-Chair of SBN Measurement Working Group Ye Yanfei. “By bringing together regulators, policymakers, trade associations and development institutions, SBN has been able to not only turn sustainable finance policies into action, but also strengthen measurement to capture market impact.”
Building on the collaborative framework, the SBN has also set up a taskforce to provide tailored support to help the region’s poorest countries, including Mongolia,Bangladesh, Nepal, Cambodia, Pakistan and Laos to overcometheir barriers to developing sustainable banking policies.
Established in 2012, SBN now represents $43 trillion (86 per cent) of banking assets in emerging markets. The report is based on an innovative results-measurement approach developed by SBN members as they work to convert sustainable finance policy reforms into practical implementation and behavior change across the banking sector.
Establishing in 2012, SBN is a voluntary community of financial sector regulatory agencies and banking associations from emerging markets committed to advancing sustainable finance. The first global network of its kind focused on sustainable finance at market level, SBN represents 38 countries and $43 trillion (86 per cent) of the total banking assets in emerging markets. SBN members are committed to moving their financial sectors towards sustainability, with the twin goals of improved ESG risk management (including disclosure of climate risks) and increased capital flows to activities with positive climate, environmental, and social impact. IFC is secretariat and technical partner, assisting members to share knowledge and access capacity building that helps them design and implement national sustainable finance initiatives.
