The Agriculture Business Initiative (aBi Finance), in partnership with Uganda Institute of Banking and Financial Services (UIBFS), has rolled out a countrywide capacity building training program on Green Finance activations.
The trainings to be conducted in all the four regions of Uganda focus on training and supporting financial institutions on key dynamics of Green Financing including green agribusiness investments for Climate Change Adaptation, Mitigation and Biodiversity Conservation.
“We believe that financial institutions have a strong reach on ground and since they talk to clients on the a daily basis, we do believe that if we train their staff, we shall have reached out to the agribusiness players in the value chain on how to adapt, mitigate and conserve the environment, “Mr. Moses Bwire, the Investments Manager – Green Growth Business Development Services at aBi Finance said during a training in Wakiso on Tuesday.
He added: “Want to help financial Institutions categorize Green Investments in areas of conservation, climate change mitigation, adaptation, and biodiversity conservation. We want to help them be able to categorise them in the perspective and be able to help the SMEs who are in that line.”
Under this arrangement, aBi Finance will also help to develop Information, Education, and Communication (IEC) materials that will be given to all the financial institutions that are taking part in the Green Financing agenda.
“We are also helping them to enhance their Environmental, Social and Governance (ESG) policies. We do believe that financial institutions have the ESG policies, but they still have a weak link on the environmental aspects” added Mr. Bwire.
aBi Finance has also deployed consultants to hep financial institutions customize their ESG policies.
Noah Owomugisha, the Head of Investments – Green Growth and Business Development Services at aBi Finance said that Green finance involves creating and distributing a range of financial products and services that deliver both investable returns and environmentally positive outcomes.
This, he said involves internalizing environmental externalities and adjusting risk perceptions in order to boost environmentally friendly investments and reduce environmentally harmful ones.
As an investor in the agricultural value chain, he says aBi seeks to increase access to sustainable financial services for investment in green by developing green finance products, training staff on green finance and management of green loans and market-oriented/sector level greening awareness creation.
Pearl Bank Celebrates Customers in Festive Campaign Dubbed Pearl Santa“These activations are meant to build capacities and close information, knowledge gaps through financial institutions whom we work with to be able to offer the financing that is needed that is environmentally sustainable, socially inclusive and well governed in terms of ensuring that we maximise the benefits both as financial institutions and also agribusinesses that we support through the financial institutions,” he said, noting the countrywide campaign seek to reach a combined 2000 financial institutions staff.
aBi Finance recently unveiled the Green Finance Fund and Green Taxonomy worth UGX.120 billion, to promote the sustainable growth and resilience of the agriculture sector.
Jane Aik, an Associate Consultant with the UIBFS said that promoting green financing involves working with financial institutions to incorporate environmental factors into their lending portfolios.
She said the Uganda Institute of Banking And Financial Services is planning to introduce a course for bankers to grow their careers in green financing.
“The institute is also looking at having programmes or courses that target the bankers to grow their careers around green financing and climate financing in general.”
She said that the demand for green finance is bound to increase substantially in Uganda as the transition to an inclusive, low-carbon and circular economy unfolds.
The Bank of Uganda (BoU) has recently prioritised ESG principles in its policies and operations. Through the new strategic plan, the BoU says it will institutionalise an ESG framework across the regulated financial institutions so that commercial banks prioritise social good and sustainability in addition to making profits for shareholders.
Through a new Climate Change Risk Policy and other programs, the BoU will require the banking sector to review its business models by strengthening the links between the preservation of the natural environment (including green financing), which supports agriculture, and the risk-adjusted returns sought by their shareholders.
This will be achieved through holistically embedding environmental sustainability in their core business strategies.
