KARACHI: State Bank of Pakistan (SBP) Governor Jameel Ahmad has launched the Environmental and Social Risk Management (ESRM) Implementation Manual for banks and development finance institutions (DFIs), a press release said on Wednesday.

The SBP governor launched the manual at a Sustainable Banking Conference held in collaboration with the Inter­national Finance Corporation (IFC).

While delivering the keynote address, the SBP governor remarked that the manual has been launched as part of the central bank’s ongoing efforts to promote green banking in Pakistan. “The ESRM manual is a procedural guide for the banks/DFIs to establish their environmental and social risk management systems, as advised in the SBP’s Green Banking Guidelines (GBGs),” he said.

He highlighted that the conference was an effort to spread awareness about the impact of climate change and environmental degradation on the financial sector of Pakistan and a step towards the SBP’s endeavour to reduce the vulnerability of the financial sector from such risks.

He added that Pakistan is one of the countries that are most vulnerable to the impacts of climate change as the nation witnessed during the recent floods. “Therefore, it is critical for Pakistan’s financial sector to become sensitive to financial consequences arising from environmental and social risks,” he said. Being a responsible regulator of the financial system, the SBP has also undertaken certain initiatives like Green Banking Guidelines and Financing Scheme for Renewable Energy to ingrain sustainability considerations into the financial sector as per international best practices.

The SBP governor encouraged the entire banking industry to take full benefit of the manual to establish their ESRM systems and procedures.

Published in Dawn, November 10th, 2022