Stanbic IBTC, LBS Collaborate to Foster Sustainable ESG Financing in Emerging Markets

*IFC: Climate finance investment can create 213 million jobs in Africa 

*IBTC credit to sustainable finance hits N84bn

Dike Onwuamaeze

Stanbic IBTC and the Lagos Business School (LBS) are collaborating to widen the scope of sustainable financing for projects that could address the pressing Social and Environmental and Governance (ESG) issues in emerging markets like Nigeria.
This was disclosed at the weekend by that Group Chief Executive Officer of Stanbic IBTC, Dr. Demola Sogunle, during the bank’s inaugural “Sustainable Finance Summit” with the theme “Sustainable Finance Opportunities in the Emerging Markets,” which he said is a collaborative effort between Stanbic IBTC and the LBS.

Sogunle said: “At the Stanbic IBTC, we believe that financial institutions play crucial role in driving sustainable development. Our commitment to sustainability is reflected in one of our recent initiatives “Sustainable Finance Framework.
“It is worthy to know that from the inception of this framework in October 2023 till date, over sustainable finance portfolio is currently at a level of N82 billion, representing nearly 5.0 per cent of the total loan portfolio of the bank. And that is significant.”
He said that another significant aspect was that they had already surpassed their 2025 budget when it comes to sustainable finance portfolio, since the budget for 2025 was set at N48 billion and N82 billion had been achieved.

According to him, the framework has guided investments in various sectors, including healthcare, education and renewable energy.
He stated that there were immense potential for sustainable finance to address pressing social and environmental issues in the emerging markets like Nigeria, which continued to grow and develop.
Sogunle, however, noted that as the challenges are real so are the opportunities for everybody.
“We strongly believe that that by working together, we can create a more sustainable future for Nigeria and Africa and actually for the world,” he said.

In his keynote address during the summit, the International Finance Corporation (IFC) Country Officer for Nigeria, Mr. Mohammed Aliyu, said that Africa was facing the most severe climate impact that could delete its Gross Domestic Product (GDP) anywhere from 2.25 per cent to 12 per cent if left unchecked.
Aliyu said: “We are witnessing first-hand the effects extreme weather events from devastating floods amongst others, which force approximately 26 million people into poverty each year globally.
“These impacts exacerbate existing vulnerabilities, particularly in infrastructure, both hard and soft. Despite this financing for climate resilient infrastructure in Africa remains inadequate.”

He, therefore, said that Africa required significant investment to meet infrastructure needs, particularly climate adaption and mitigation.
“As the world becomes more climate conscious, increasing concerns over climate change and Environmental, Social and Governance (ESG) criteria constrained the type of projects that development partners and the private sector fund.
“To mitigate this requires a delicate balance not just in Africa but globally to align the needs of developing nations with climate and sustainability considerations,” he said.
According to him, designing a greening strategy in an African nation would require careful considerations of the unique political economic dynamics of the nation.
“A decarbonisation strategy for African nation requires navigating a complex political economic landscape shaped by socio-economic challenges, vested interests, weak institutions and pressing need for energy access and development,” Aliyu said.
He added that policy makers must carefully balance these considerations and ensure that climate actions are aligned with national development priorities while building public support and managing political resistance.
He, however, said that within these challenges lie unprecedented opportunities.
“The World Bank estimated that climate related industries in Africa represent a potential $780 billion investment opportunities. This could lead to the creation of 213 million jobs while contributing to a reduction of over 4.0 billion tonnes of carbon emissions in developing countries.
“Therefore, for private and public stakeholders, effectively addressing climate change is not only crucial for tackling poverty, unemployment and inequality but also for promoting shared prosperity across the continent,” he added.
Speaking in the same vein, the Dean, Lagos Business School, Prof. Chris Ogbochie, said that Africa is perceived to be synonymous with various developmental challenges across environmental, social and economic lives.
These challenges, according to Ogbochie, demand that the continent should prioritise investments that have potential for environmental and socio-economic value creation for the continent and its people.
He said: “No other sector and industry has this burden placed squarely on its shoulders like the financial service sector.
“And no other continent has this opportunity in abundance for sustainable finance investors to tap into like Africa. We have a long way to go. We have taken the first step. And I believe that we can go ahead and make the most of it.
“We believe this summit will deliver strong financial solutions that will enable a robust sustainable financial architecture for Nigeria and the continent at large.”