Environmental, Social, and Governance (Esg) Risk

We are committed to facilitating African economies’ access to energy and other infrastructure essential for economic growth and human development, while aligning with the objectives of the Paris Agreement and minimising harmful environmental impacts associated with the use of fossil fuels. We are working to support a just transition to a low carbon economy in our countries of operation, but we recognise that this will take time, and will need careful consideration of the social impacts.

We adopted a fossil fuel finance policy in 2020, which sets parameters for our lending in this area, and which complements the coal-fired power finance policy and the thermal coal mining finance policy adopted by the group in 2019. (links to all three policies)

Our sustainable finance business unit hit the ground running in 2019. It launched our sustainable bond framework in early 2020 and has concluded several ESG-linked loan transactions over the past 18 months. Our Wealth and Investment teams have introduced new ESG-linked products. Our Insurance team has undertaken an ESG risk identification and assessment exercise and are working to enable the formalisation and proactive management of ESG risks going forward. We remain committed to consulting, engaging and partnering with our stakeholders, and to reporting transparently on progress as we work toward strengthening our ESG risk governance and management.

We participate in local and global business and industry forums and engage with civil society organisations with a focus on understanding our social and environmental impacts and stakeholder concerns and expectations. We choose to hold ourselves to a number of voluntary global standards regarding responsible business practice, including the UN Principles for Responsible Banking, the Equator Principles, and the UN Women He4She initiative and the UN Women Empowerment Principles. Through the UN Principles for Responsible Banking Board, we are working with other banks to develop impact measurement tools and methodologies that all 200 signatory banks will be able to use.

Our business is inherently about trade-offs. Every decision we make will have opportunity costs and will have positive and negative impacts. We cannot promise to satisfy all our stakeholders. But we do promise that every decision we take will be carefully considered and will aim to make Africa a better place now, and for the generations to come.

Achieving our group purpose and strategy depends on our reputation as a trusted partner across Africa. The group’s code of ethics, organisational culture and values determine how we do business and with whom we do business.

During 2020, the group further strengthened and matured our management of non-financial risks, embedding oversight at group, risk type and business unit levels. As part of this process, ESG Risk was further integrated into the group’s enterprise risk management (ERM) framework.