The significance of ‘leading the way’ on sustainable financing is stressed by the BSP
Governor Benjamin Diokno of the Bangko Sentral ng Pilipinas (BSP) emphasized the necessity for the central bank to lead the way in investing in sustainable finance in order to inspire other institutions to follow suit.
Diokno said the BSP adopted the sustainable central banking program as one of its corporate strategies vis-à-vis the sustainability agenda during a virtual event hosted by the International Monetary Fund (IMF) on Thursday night, October 1, 2021, titled “Embedding Climate Change into Asia’s Recovery Strategy.”
According to him, monetary authorities have created a sustainable central banking roadmap that will serve as a framework and milestone for the central bank’s implementation of sustainability principles.
“The framework emphasizes the central bank’s critical responsibilities as facilitator, mobilizer, and doer in promoting financial system sustainability,” Diokno added.
For one thing, he claims that the BSP fosters a policy climate that encourages the use and development of sustainable finance as an enabler.
“The BSP will provide more comprehensive risk management rules to complement the sustainable finance framework,” Diokno added, citing this bid as an enabler.
The BSP would also “lead and encourage financial institutions to make ecologically and socially responsible business choices and embrace green practices,” according to him.
In accordance with its sustainable investment policy, he said the BSP has invested in the Bank for International Settlements’ (BIS) green bond fund, among other things.
According to Diokno, the bank has established a bank-wide technical working group (TWG) to evaluate susceptibility “to identify the effect of climate change on BSP offices and branches.”
He said that the TWG will do “a gap analysis to identify areas in the BSP operations where ESG (environmental, social, and governance) or green principles and practices may be embedded.”
“As you can see, through enabling, mobilizing, and doing, we’re using a comprehensive approach to promote sustainability,” he said.