The Philippines has been recognized for its progress in sustainable finance, being one of six countries that are in the process of developing regulations and industry standards for sustainable finance frameworks.
According to the second Global Progress Report of the International Finance Corp. (IFC)-facilitated Sustainable Banking Network (SBN) released yesterday, the Philippines is among the group of countries moving from “Commitment” to “Formulating” stage under the Preparation phase.
“Egypt, Fiji, Ghana, India, Philippines, and Thailand started to develop guidance for their financial sectors,” the report said.
The IFC said in a statement that for the last few years, a broad range of initiatives linked to environmental and social risk management and green finance show that efforts are being made by the banking regulators and banking associations to raise awareness, build capacity and encourage stakeholder engagement.
The IFC noted that the Bangko Sentral ng Pilipinas (BSP) is currently drafting a policy framework for sustainable finance in response to growing market awareness and appetite for green and sustainable financing. The policy is targeted for completion by the end 2019.
“The capacity building and sustainable finance policy initiatives of the Bangko Sentral ng Pilipinas were enriched by the knowledge resources, information and peer learning activities accessed through our membership in the Sustainable Banking Network,” said Benjamin Diokno, BSP governor, as quoted in the IFC statement.
“We are grateful to the IFC for the continued support as we ramp up our efforts to implement our sustainable finance agenda,” he added.
The IFC said 38 emerging market economies have initiated key banking reforms to drive development and fight climate change.
These reforms require banks to assess, manage and report on environmental, social and governance risks in their lending operations and put market incentives in place for banks to lend to green projects.
Of the 38 countries, 22 have adopted national sustainable finance policies and voluntary principles, seven of which were launched in 2019 alone.
The report also captures the progress made by 14 countries to actively grow their green bond markets; and data shows increasing innovation by financial institutions to green their lending portfolios.
“SBN members have demonstrated that transforming financial markets toward sustainability is possible,” said Georgina Baker, vice president of IFC, World Bank Group.
“Emerging markets are on the forefront of this shift – and SBN’s tools and guidance have laid the groundwork for more countries to follow suit,” she added.