Financial institutions urged to leverage technology as they implement ESG practices for sustainable growth.

Financial institutions urged to leverage technology as they implement ESG practices for sustainable growth.
Group photo at the Banker's Conference on Wednesday

Banks and Financial institution under their organization Uganda Banker’s Association (UBA) and partners on 19th June 2024 held their 7th Annual Banker’s Conference at Serena Hotel in Kampala.

The theme of the conference was: Navigating the Future of Banking: ESG (Environmental, Social, and Governance), Sustainability, and Digital Transformation.

During his opening remarks, The Chairman of Uganda Banker’s Association Mr Julius Kakeeto said the objectives of this conference and included: Briefing stakeholders on where the banking & financial sector is on ESG & sustainability and its application in customer/business operations & relations therein, To demonstrate & ensure the industry ESG framework & sustainability strategies align with the national (Government) climate strategy & sustainability agenda/goals, To share lessons learned in the ESG journey or experience from other jurisdictions (risks, challenges, regulatory frameworks, success stories among others and To promote sustainable finance initiatives by zooming in on technology as an enabler in the ESG journey and multiplier role of the energy sector among others.

Dr. Tumubweine Twinemanzi

Dr. Tumubweine Twinemanzi, Executive Director of Bank Supervision Directorate, Bank Of Uganda who represented the Deputy Governor, Michael Atingi-Ego following the release of the Environmental, Social, and Governance (ESG) framework they have worked with the Bankers Association to ensure that the framework implementation guilds banks and financial institution to make decisions with a mind of the future generation including environment and social aspects.

 “The ESG Framework that we released earlier this month was a result of extensive research and analysis we did and it's meant to be a torch through the daily activities, guiding financial institutions on decisions that go beyond mere goals for financial gain, but consider the future impact more” he said

He said that digitalization has increasingly become inseparable from banking and finance sector and has led to a transformational change, as the industry needs to be mindful, inclusive of the ESG Framework and agenda, and be environmentally responsible and ethical behavior in the industry and businesses at large.

The Permanent Secretary and Secretary to the Treasury in the Ministry of Finance, Planning, and Economic Development, Mr. Ramathan Ggoobi while officiating at the conference said that the government launched the Environmental, Social, and Governance framework as part of her participation to enable industry players to implement it in a bid to mitigate the problems it was intended to solve.

 “A number of frameworks are in the pipeline, the major aim being; to mitigate these problems and ensure that they are up and running. We've launched the ESG framework and now pass the onus to you

UBA Chairman Mr Julius Kakeeto

The Chairman of UBA Mr Julius Kakeeto, in his remarks highlighted that  “the Central Bank of Uganda has been championing the process of integrating ESG principles and sustainability into the operations of supervised financial institutions and on the 4th of June 2024, the banking industry ESG framework was launched by the Deputy Governor, Dr Michael Atingi-Ego”

He added that the purpose of this framework is to guide UBA members through the process including, The level of integration of environmental and Social (E&S) risk issues in the strategic objectives of the respective financial institutions (Board of Directors), Organizational structures in place to support the attainment of ESG and sustainability objectives, and their integration in performance appraisal systems, Getting buy-in across all institutional levels, Securing & allocating resources (human, financial, technical among others.

The Keynote speaker Dr. Martin Odour Otieno and CEO of Leadership Group said that the ESG values need to be made more appealing to every stakeholder, extended as far as students, to plant these responsible practices on the grass root level, and make them highly commendable.

He said according to the State of Climate in Africa Report 2022, a rise in temperatures all around the content has accelerated in recent decades bringing with it weather and climate-related hazards getting more and more severe, which he said affect us all both socially and economically seeing tragedies and massive losses of trade, finance and infrastructure damages along the way. 

“We have to look at the whole 'Sustainability and ESG practices' holistically because everybody plays a role in this and should look at the whole thing collectively, not selectively focusing on a singular element. Brands need to channel these ESG practices, because it impacts them tremendously as the consumers have now grown extremely savvy and product delivery no longer appeals to them as a solo product but wish to align with companies and institutions that subscribe to sustainability and environmental frameworks and livelihood” he said

Country Manager,  Mastercard East Africa Mr Ali Shehryar pointed out that if we are to achieve sustainable growing companies, there is a need to embrace ESG practices

He said that Mastercard has an African initiative aimed at planting millions of trees with the core goal of reducing our global carbon footprints while urging everyone to join the cause through cooperation and collaboration to challenge the global challenges that affect all collectively.

Executive Director, Equity Bank Uganda Elizabeth Kasedde

Executive Director, Equity Bank Uganda Elizabeth Kasedde in her presentation during a panel discussion stated that "Effective risk management is vital for our longevity as we strive to build a sustainable organization that transcends generations, outlasting individual tenure and achieving enduring impact"

While discussing on the topic “exploring innovation and technology for ESG transformation in the financial services industry” said that “we need to create a commercial way to promote the behavior that we want to see so from a financial institution perspective and at Equity Bank we have set up our energy sector unit. The ESG risk is for all of us, let us come up with mitigation mechanisms that are practical from the ground up” she said