Rana Kapoor, MD & CEO, YES Bank, feels that instead of primarily striving for maximum financial profits, companies can implement sustainable finance in their core business operations.
July 23, 2015 | Rana KapoorSustainable finance is about using money with the socio-environmental and economic impacts of investments and debt disbursements being given equal importance. The movement is inspired by the basic notion of ‘sustainable development’, by meeting present day needs without compromising those of future generations.
This initiative which may have initially begun as a reputation building exercise and relegated to being classified as ‘niche’, is increasingly becoming a key part of the operations of financial institutions. Case in point, we are increasingly coming across business opportunities in clean production, renewable energy and sustainable development projects followed by Indian financial institutions taking social and environmental footprint of their operations into greater consideration.
This change has been driven by a number of factors.
First, renewable and clean production techniques are progressively becoming more credit worthy with efficiency breakthroughs and improved business models. Secondly, the world is decisively moving towards more sustainable development strategies, the most visible manifestation of which is the proposed ‘UN Sustainable Development Goals’. The draft goals which will be finalized in the upcoming UN summit in Paris (September, 2015) focus a lot on social and environmental sustainability; at least four goals listed in the draft list focus on these aspects. Finally, industry as an extension of the society is itself becoming social and environmentally conscious and catalyzing the movement towards sustainable development. Given the direct linkages of environmental degradation to human productivity and public health, it is not surprising that society is beginning to understand the short term, and thereby more immediate, impacts of ecological degradation, pollution and climate change.
The Indian government is integrating and mainstreaming renewable energy into its security theme at an incredible pace,...
Categories:
China, India, Operational Risk, Regulation, Risk and RegulationKeywords:Systemic Risk, YES Bank, Sustainable Development Goals, Smart Cities
