Tanzania’s private sector has a critical role to play in the conservation of biodiversity for sustainable economic development and livelihoods. Businesses use biodiversity and can have a significant impact on the environment by adopting and mainstreaming sustainable practices and strategies into business operations. By doing so Businesses can have a large and rippling impact of the environment by enhancing positive behaviours across areas of direct and indirect influence.
Sustainable practices are those that: at minimum do not harm people or the planet and at best, play a critical role in creating and safeguarding value for stakeholders by working to improve on the status of environmental, social, and governance (ESG) performance.
Finance is widely seen as an obstacle to a better world. Adopting financial sustainability practices helps businesses access new opportunities, save costs, leads to good financial performance, improves brand reputation as well as attracts customers and investors.
Kickstarting Tanzania’s journey towards sustainable finance practices, the CEOrt in partnership with the International Union for Conservation of Nature (IUCN) and the Tanzania Bankers Association (TBA), established the Sustainable Finance Principles (SFPs) in 2019. The key agenda behind the principles being to outline how the financial sector can use finance as a means to achieve social goals and divert the planet and its economy from its current path to a world that is sustainable for all.
The principles have been designed to prioritize environmental and social sustainability, which will strengthen and expand business opportunities in Tanzania. The principles have been inspired by a number of national, regional and global initiatives striving to guide financial sector contributions to sustainable development.
Purpose of the Sustainable Finance Principles
Raise financial sector awareness of the environmental and social risks associated to business-as-usual and opportunities linked to embracing sustainable development strategies.
Promote sustainable finance practices by setting the key environmental, social and governance requirements for financial institutions.
Increase transparency and consistency in the implementation of policies and practices for sustainable environmental and social management in the sector’s business activities and operations.
Reinforce and promote client and stakeholder confidence in the financial sector.
Realizing that the support and involvement of the relevant regulatory bodies is crucial in the design and operationalization of SFPs, the CEOrt over the past 4 years has been closely engaging Tanzania’s Bankers Associate to play a critical role in this process in an effort to enhance adoption and compliance efforts within the wider community of financial institutions.
In collaboration with the World-Wide Fund for Nature (WWF), TBA has deployed robust awareness and sensitization efforts to support the banking sector to understand the modalities behind the successful adoption of the SFPs and the requirements to develop the relevant Financial Inclusion Framework for successful green business platforms.
Business Case for Sustainability
Sustainability challenges pose numerous business risks that can result in material costs to companies. Continued population growth coupled with climate change challenges are expected to have serious implications on the natural resource base, communities and businesses, which depend on them. The approach of sustainable banking is to help stimulate further economic growth and opportunity as well as enhance innovation and competitiveness, while helping shape Tanzania’s economic, social and environmental development agenda. To fully support this agenda, it is therefore paramount that the private sector take the lead in helping mold Tanzania’s financial landscape via the championing and mainstreaming of the SFPs via private banks.
