Five leading global banks join sustainable finance alliance

Five of the world’s leading financial institutions have become cornerstone members of the Alliance for Green Commercial Banks.

The Alliance – as it is known – is a global initiative aimed at bringing together pioneers in green finance to catalyse the financial innovation, investment and leading practices in emerging markets that are urgently needed to address climate and environmental risks.

The banks include Bank of China (Hong Kong), Citi, HSBC, Standard Chartered and Crédit Agricole CIB, of which together represent over $7trn in assets. The alliance was established by the International Finance Corporation.

According to the Hong Kong Monetary Authority, the Alliance brings together financial and research institutions and innovative technology providers to develop a green community in emerging markets to collectively finance the infrastructure and business solutions needed to advance sustainable economic development.

The five banks will work closely with the IFC and the HKMA to advocate client adaptation to green strategies, promote best practices in green products and services and unlock new business opportunities that will enable the green transition of economies.

In addition, the Alliance leverages its resources to help financial institutions in their green transition with the support of a roster of partners. These include the Carbon Trust, the Institute of Public and Environmental Affairs and the University of Chicago amongst others.

Alongside the new member additions, the Alliance has recentlu launched its first though leadership paper – Climate Risk: Definitions, Measurement, Current Practices and Regulatory Oversight – in collaboration with the Hong Kong Institute for Monetary and Financial Research.

The HKMA stated, “As part of the Alliance’s knowledge sharing efforts, the paper aims to be a primer on climate risk and its broad reverberation to the financial services industry for a non-technical audience in Asia and internationally. It provides an overview of the definitions and measurement of climate risk, as well as an exploration of the evolving practices in addressing climate risk, highlighting regulatory initiatives related to climate issues.”

HKMA CEO Eddie Yue said, “The HKMA is committed to making Hong Kong SAR a leading global hub for green finance. Building the capacity of commercial banks and other financial institutions in Asia will help to scale up green finance markets and increase the risk resilience of the sector. The five cornerstone members share our vision of promoting more sustainable and more resilient regional growth, and we are excited to work with them in our collective efforts to address climate and environmental risks.”

The Green Finance Industry Taskforce (GFIT), convened by the Monetary Authority of Singapore, recently published the second version of its green taxonomy for consultation.

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