The ICC has recently launched its innovative Principles for Sustainable Trade Finance (PSTF) during the Sibos 2024 conference.
Developed in collaboration with leading experts from the financial sector, corporates, and Boston Consulting Group (BCG), these principles are designed to standardize and guide sustainable practices within the trade finance sector.
The PSTF addresses a significant gap within existing sustainable finance frameworks, which often struggle to adapt to the unique characteristics of trade finance as a flow product. These newly established principles provide clear, transparent, and consistent guidelines aimed at enabling banks, corporations, and investors to direct capital towards sustainable and inclusive trade finance solutions effectively.
The ICC plays a crucial role in shaping the global trade finance landscape. Its efforts are geared towards creating a more integrated and ethically sound trading ecosystem, which the PSTF further supports by providing a structured approach to sustainability in trade finance.
The PSTF is structured into four key sections: bespoke Principles for Green Trade Finance, ICC guidance on Sustainability Linked Trade Finance, ICC guidance on Sustainability Linked Supply Chain Finance, and ICC’s ambition for Social Trade Finance. These components collectively offer a comprehensive framework for stakeholders to adopt and implement sustainable trade finance practices.
Additionally, the ICC has initiated an industry-wide consultation phase. This stage invites feedback and comments from all stakeholders within the trade finance sector, ensuring that the principles are robust, practical, and reflective of the diverse needs across the industry.
After the consultation period concludes, the PSTF will be finalised and officially released later this year, marking a significant milestone in promoting sustainable trade finance globally.
“ICC secretary general John Denton said, “These principles are set to revolutionize the trade finance industry by setting a new standard for sustainability that aligns with global environmental objectives.”
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