Emerging market banks are key to climate action
The hard truth is that in much of the developing world, climate change still ranks well below more immediate concerns such as unemployment, disease, poverty and political unrest for households and businesses.
Tell a random selection of bankers in London or New York that you’re going to Glasgow for COP26, and the most likely response will be: “Have you got somewhere to stay?”
Try the same gambit on their peers in Moscow or Jakarta and there’s a good chance it will be met with a blank stare and a “What’s that?”.
For those in countries where climate is an inescapable part of any discussion of the future of finance, it can be hard to realize the extent of the indifference to and lack of awareness of the topic in much of the rest of the world.
This is clearly not because emerging-market bankers are less socially responsible than their developed-market counterparts. Rather, it reflects the priorities of the societies in which they operate.
And the hard truth is that in much of the developing world, climate change still ranks well below more immediate issues such as unemployment, disease, poverty and political unrest for households and businesses.
Where societal pressures on banks are lacking, regulators can help to fill the gap – which is why the steady expansion of the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) is very welcome.