The launch of the Roadmap for Sustainable Finance in Sri Lanka reflects the commitment of the Central Bank towards creating a greener, more sustainable financial systems that contribute to develop a sustainable economy and a country for its future generation, Central Bank Governor, Dr. Indrajit Coomaraswamy said.
He said, the Central Bank has placed much emphasis on sustainability aspect as the bank considers it as one of the core principles of the financial sector.
“The main thrust of the road map is to ensure that the sustainability is embedded in the decisions of stakeholders in the financial sector. We are very cognizant about the unprecedented climate change that is taking place.
The frequency and the severity of extreme climate events is increasing day by day.
This forum is a timely move to bring together the key stakeholders of the financial sector as well as government representatives and international partners to discuss the way forward to develop the financial systems. Furthermore, the objectives of the roadmap are to integrate environmental, social and governance criteria into business decisions of both the financial institutions and clients,” he said.
“Substantial dangers posed by climate change have been scientifically proven. It is important to mention that the Paris Agreement is aiming to strengthen the global response to the threat of climate change by keeping a global temperature rise this century well below 2 degrees Celsius above pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5 degrees Celsius.”
To meet these targets, financial systems across countries are addressing the challenges of speeding up and scaling up financial facilitation for building below 2 degrees Celsius resilient economies while managing issues related to environment and social risks.” he said.
He further said that the world is facing a daunting investment gap in delivering the targets of the Paris Agreement. (IH) Therefore, he said public funds will always not be sufficient to meet required investments to battle the climate change. To support these endeavors, he said financial and banking sectors as well as the private sector have a critical role to play in financing this investment gap.
Dr. Coomaraswamy added the Central Bank is in the process of operationalising the roadmap time framework. The CB has set up a steering committee within the bank to implement the road map and to monitor the progress.
“In addition, we will be considering issuing relevant directions to incentivize the financial institutions to practice sustainable finance activities,” he said.
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