Banks and Their Relationship With The Environment

Banks use to be able to fund coal mines and oil exploration ventures all they wanted. However, recent waves of criticism concerning such practices has had an impact on the way banks choose to invest in companies. Hong Kong’s banking industry in particular has been facing growing pressure to face ESG accountability, with a growing emphasis on the “E” part (environment). They have been incentivised to focus their lending activities on firms and businesses that focus on making “green” products that aim to make the world more sustainable.

As such, lenders like Hang Seng Bank opted to sign-up for the international Task Force on Climate-Related Financial Disclosures (TCFD) to make their services more ESG compliant. They were the first bank in Hong Kong to do so, and as a consequence, put pressure on competing banks to step up their sustainability efforts. Some banks have even undertaken more tangible displays of becoming – or at least looking – green, with City Bank installing 360 solar panels on top of their office building. And while public outcry over global warming has forced lenders in Hong Kong to rethink how they invest their capital, it remains to be seen to what degree the impact of such sustainable practices will have on the environment.

As ESG initiatives conducted by firms are forecasted to become an increasing priority to them, your BLCC will continue to dive deeper into this topic at its annual Belgium Business Seminar this October, with keynote speaker Umicore scheduled to speak. The event is scheduled for the 21st, with additional details due to be revealed soon. Save the date!