BANK­ING ON THE EN­VI­RON­MENT

Qatar Today - - BUSINESS -

WHILE THE CON­CEPT OF GREEN BANK­ING IS STILL NASCENT IN THIS PART OF THE WORLD, SOME FI­NAN­CIAL IN­STI­TU­TIONS LIKE DOHA BANK ARE IN THE VAN­GUARD OF THIS MOVE­MENT.

There is now height­ened aware­ness within the bank­ing com­mu­nity about the need to mod­ify their ac­tiv­i­ties and strate­gies to en­sure the pro­tec­tion of nat­u­ral re­sources and the en­vi­ron­ment. As a re­sult, banks are in­creas­ingly adopt­ing Green Bank­ing as part of their cor­po­rate so­cial re­spon­si­bil­ity (CSR) and sus­tain­able de­vel­op­ment agenda. CEO of Doha Bank, Dr Seethara­man, says, “We be­lieve banks, as re­spon­si­ble cor­po­rate cit­i­zens, have a role to play in pro­tect­ing the en­vi­ron­ment and must con­trib­ute to sus­tain­able de­vel­op­ment.”

Across the globe, there have been con­tin­u­ous ef­forts aimed at mit­i­gat­ing the risk of cli­mate change caused by hu­man ac­tiv­ity. While it is true that banks are con­sid­ered rel­a­tively en­vi­ron­ment­friendly and do not im­pact the en­vi­ron­ment greatly through their own in­ter­nal op­er­a­tions, the ex­ter­nal im­pact on the en­vi­ron­ment through the ac­tiv­i­ties of their cus­tomers is in­deed sub­stan­tial, says Dr Seethara­man. Banks can there­fore play a vi­tal role in aid­ing the re­duc­tion of ex­ter­nal car­bon emis­sions by fi­nanc­ing green tech­nol­ogy and pol­lu­tion-re­duc­ing projects. Green fi­nance as a part of Green Bank­ing can make sig­nif­i­cant con­tri­bu­tion to the tran­si­tion to re­source-ef­fi­cient and low-car­bon in­dus­tries.

Green­house gas emis­sions need to be es­ti­mated for ma­jor eco­nomic sec­tors in ar­eas of bank­ing op­er­a­tion to de­ter­mine the car­bon foot­print. Based on the car­bon foot­print in var­i­ous eco­nomic sec­tors, tar­geted ini­tia­tives can be pro­posed to pro­mote green economies. Th­ese ini­tia­tives can in­clude lend­ing for green projects, Clean De­vel­op­ment Mech­a­nism (CDM) schemes and pa­per­less bank­ing. The al­lo­ca­tion ma­trix should be such that the greater the car­bon foot­print in the rel­e­vant eco­nomic sec­tor, the higher the al­lo­ca­tion of cap­i­tal for Green Bank­ing and sus­tain­able projects.

The car­bon foot­print will be dif­fer­ent across var­i­ous ge­ogra­phies and eco­nomic sec­tors and hence coun­try-wide and sec­tor­wide al­lo­ca­tions should be ex­plored. This forms the ba­sis for Green Bank­ing and brings pru­dency into the cap­i­tal frame­work, says Dr Seethara­man.

Be­ing more spe­cific, he says, “In our view, ev­ery bank should ear­mark a min­i­mum of 10% of Tier 1 cap­i­tal sub­ject to a cap of 10% of risk-weighted cap­i­tal to­wards Green Bank­ing or CDM or any other sus­tain­able de­vel­op­ment projects, tak­ing into con­sid­er­a­tion the car­bon emis­sions pre­vail­ing in the econ­omy in which the bank op­er­ates.”

Doha Bank ‘s CSR phi­los­o­phy is rooted in a com­mit­ment to pro­mote and sup­port high-im­pact pro­grammes that make a pos­i­tive im­pact on com­mu­ni­ties and on the en­vi­ron­ment. The bank pro­motes pa­per­less bank­ing, In­ter­net bank­ing, SMS bank­ing and the like, as well as on­line chan­nels such as Doha Sooq, e-re­mit­tances, e-state­ments and on­line bill pay­ments. They also launched a green credit card as well as a green ac­count.

In ad­di­tion, Doha Bank has a ded­i­cated Green Bank­ing web­site www. do­ha­green­bank.com, which in­te­grates the Bank s ini­tia­tives in pro­mot­ing en­vi­ron­men­tal sus­tain­abil­ity by reach­ing out to the pub­lic and pri­vate sec­tors as well as to lo­cal com­mu­ni­ties. Doha Bank hosts the an­nual Al Dana Green Run as part of its ef­forts to en­hance en­vi­ron­men­tal aware­ness and pro­mote a health­ier lifestyle among mem­bers of the lo­cal com­mu­nity, in ad­di­tion to cam­paigns like beach cleanup, Planet Savers Club, etc., spear­headed by the bank ‘s Green Bank­ing Task Force Com­mit­tee

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