The Kenyan banking industry has unveiled the Climate-Related Financial Disclosures Template which aims to enhance transparency on how the industry is communicating their approach to managing climate-related challenges and opportunities.
The Climate-Related Financial Disclosures Template is based on the four core pillars of the Taskforce on Climate-related Financial Disclosures (TCFD) framework: Governance, Strategy, Risk Management, and Metrics & Targets.
In a statement, the banking industry umbrella body, Kenya Bankers Association, notes that the template serves as a comprehensive guide for banks to effectively report their climate-related risks and opportunities.
“Through our Sustainable Finance Initiative (SFI) e-learning training, we have been able to sensitize our members to make lending decisions that benefit the environment, society, and economy. So far, and since 2015, our program has reached more than 45 thousand bank employees (including those that have since left the industry). We are glad to take another bold step in promoting transparency in our industry, through the launch of Banks’ Climate Related Financial Disclosures template”. KBA CEO, Dr. Habil Olaka said.
Central Bank Climate-Related Risk Management
The newly introduced reporting tool is accessible to all commercial banks licensed and regulated by the Central Bank of Kenya. It is specifically designed to align with the 11 recommended disclosures outlined by TCFD within the governance, strategy, risk management, and metrics and targets domains. This alignment enables banks to meet the Central Bank of Kenya’s Guidance on Climate-Related Risk Management, which was issued on 15th October 2021.
“Adapting to nature related risks can actually drive innovation within the banking sector and sustainable finance offers such an opportunity for innovation to be able to respond to these climate related risks.” says Jackson Kiplagat, Head of Conservation Programmes at WWF-Kenya.
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