Businesses have been encouraged to embrace Environmental Sustainability Governance (ESG) practices which are more than a regulatory requirement, but a strategic move towards enduring sustainability and resilience in a dynamic business environment.
The call was made at the 7th Annual Bankers Conference held under the theme: Navigating the future of banking: ESG, Sustainability, and Digital Transformation.
The conference follows the recent launch of the banking industry ESG framework aimed at championing the process of integrating ESG principles and sustainability into the operations of supervised financial institutions in the country.
While speaking at the conference, PostBank Uganda Managing Director who also doubles as Uganda Bankers Association (UBA) Chairman, Julius Kakeeto, encouraged entities to embrace ESG as it is a fundamental component of a resilient and sustainable financial future.
“The regulatory landscape is rapidly evolving to support the accelerated shift towards a sustainable future and manage the challenges this presents, thus embracing ESG is now more than a regulatory requirement but rather a strategic move towards enduring sustainability and resilience in a dynamic business environment,” Mr. Kakeeto said.
He further highlighted, “The case of Uganda provides a compelling illustration of ESG integration with the National Development Plan (NDP III) incorporating commitments to regional and international development frameworks, including ESG. The second Nationally Determined Contribution (NDC) outlines ambitious targets, aligned with national policies like Vision 2040 and the National Climate Change Act of 2021.”
The 2024 UBA conference aimed at; briefing stakeholders where the banking & financial sector is on ESG and sustainability and its application in customer/business operations & relations therein, demonstrating and ensuring the industry ESG framework & sustainability strategies align with the national (Government) climate strategy & sustainability agenda/goals, sharing lessons learned in the ESG journey or experience from other jurisdictions (risks, challenges, regulatory frameworks, success stories among others), promoting sustainable finance initiatives by zooming in on technology as an enabler in the ESG journey and multiplier role of the energy sector and positioning the banking & financial sector in Uganda to attract more collaboration and partnerships in promoting/delivering ESG & Sustainability objectives.
Bank of Uganda Executive Director of the Bank Supervision Directorate, Tumubweine Twinemanzi reaffirmed BOU’s support towards the banking sector.
“Bank of Uganda working with UBA established an industry ESG framework that was rolled out two weeks ago. Unlike other countries, in Uganda, the Central Bank approached the ESG agenda differently by allowing the banking industry to be at the forefront of the framework and as the regulator we followed. I believe in addition to the guidelines we have in place that business operators can adopt while conducting business,” he noted.
The Permanent Secretary and Secretary to the Treasury, Ministry of Finance, Ramathan Ggoobi, affirmed that Uganda’s economy is safe and growing at a good rate which is 6%, revealing that it has recovered from various shocks that were affecting it for the last 5 years. He mentioned that the Ministry has a good plan for accelerating economic growth.
Commenting on the ESG move, Mr. Ggobbi stressed the government’s commitment to climate change adaptation and mitigation with several policies put in place to support this agenda.
“Financial institutions occupy a pivotal position in addressing ESG risks because they can direct capital towards transformative investments and projects that are sustainable and bring about inclusivity coupled with positive environmental & social impact, thus we must fully integrate ESG principles into our business practices for sustainable business environment,” Kakeeto concluded.