BY MICHAEL EBOH
Central Bank of Nigeria, CBN and some banks in the country have constituted a committee for the design of sustainable lending principles for the banking industry, aimed at environmental protection, social well-being and economic prosperity.

The committee, called the Sustainability Working Group, was set up at the end of the Chief Executive Officers’ Roundtable on Sustainable Finance at the Nigerian Sustainable Finance Week, sponsored by Access Bank Plc in Lagos, and is saddled with the responsibility of setting up guidelines for banks’ lending to corporate organizations, in line with environmental and social concerns.

The committee which was constituted to commence work on a number of initiatives agreed to by the banks, comprises: Access Bank, Diamond Bank, GTBank, Standard Chartered Bank, Citibank and Zenith Bank.

The working group will work in conjunction with the International Finance Corporation (IFC) and the Dutch Development Bank (FMO).

The Sustainability Working Group will function on the platform of the Banker’s Committee’s Economic Development sub-committee led by Access Bank’s Group Managing Director/CEO, Aigboje Aig-Imoukhuede.

Speaking on the development, Mallam Sanusi Lamido, Governor, CBN, said the increased consciousness on sustainable finance has been driven this far with the help of development partners, adding that the CBN and the banks are now committed to localising and internalising the ideas of sustainable finance.

According to him, what we want to do now is place it on the agenda of the Bankers’ committee and make the banks themselves own this, and agree that this is the way they want to operate.

He said further, “We need to understand that as an industry, we will not continue to take savings and deposits from Nigerians and then lend to companies that will use the funds to destroy the environment. The long term survival of the system depends on the protection of the ecosystem.

“This is an expected change and continuation of the attitude of the bankers’ committee and just an addition to our commitment to economic development. This is less about money and more about ethics and principles.”

Also speaking, Aig-Imoukhuede said “The focus of Nigeria’s banking sector on environmental and social sustainability issues has to date been limited, pointing to the insufficiency of internal capacity or management guidelines in the sector.

“But as today’s decision attests, the meaning of business as usual is changing for the better in Nigeria. There is a growing awareness of business-related social and environmental risks, and the necessity that these risks be actively managed.”

“The collective resolution to establish industry standards for determining, assessing and managing social and environmental risks in lending activities is a genuine reflection of the sector’s commitment to issues of sustainability and corporate responsibility.”

Commenting on the CEOs resolution, UNEP FI’s Head, Paul Clements-Hunt said “Today’s decision is a historic commitment by Nigerian regulators and bankers to a better environment. It is inspiring to witness a country coming together to address one of the greatest challenges currently facing humanity.”

Also, Nanno Kleiterp, Chief Executive Officer, FMO added “The joint decision is an important step forward for the Nigerian banking sector. It signals a strong commitment from the CEOs present here today to take a leadership role in guiding industry change in sustainable finance.”

“I feel confident that what we have just witnessed here will be a turning point for lasting growth. Nigeria is rapidly becoming a frontrunner in sustainable finance in Africa.”