Growing awareness of green financing

Awareness of green financing in Bangladesh has grown among stakeholders, experts said at an international conference on Tuesday.

Practising good governance, proper coordination between respective agencies, building capacity of banks and financial institutions, proper policies, developing a bond, and a stable equity market are key factors for green financing, they added.

The Bangladesh Institute of Capital Market (BICM) organised the conference, "Sustainable Finance and Investment," with Mahmuda Akhtar, chairperson of the institute, in the chair.

From October to December 2020, banks financed Tk3887 crore in green projects, according to the Bangladesh Bank.

Speaking as chief guest, Professor Shibli Rubayat-Ul-Islam, chairman of the Bangladesh Securities and Exchange Commission (BSEC), said Bangladesh's economy is doing better than before by all indicators.

"In the first 30 years of independence, we did not make progress. Now we have to move at twice the speed," he added.

Speaking as guest of honour, Professor Dr Atiur Rahman said, "We need a green recovery from the global pandemic. To achieve sustainable development, capital has to be mobilised for the inclusion of service groups, and capital has to be raised for sustainable financing and supporting innovations.

Sustainability needs to be mainstreamed, ensuring market integrity, risk management, and sufficient disclosures."

He added that banks provide short-term financing so that the capital market maintains long-term financing.

The regulatory authority needs to make arrangements for good and proper disclosure to ensure the efficiency of the market.

At the same time, he emphasised financial reporting and corporate governance being vital for a sustainable economy.

Special Guest Frank Rijberman, director-general of Global Green Growth Institute (GGGI), welcomed the green bond initiative in Bangladesh.

At the same time, he emphasised research and development in green projects to strengthen green financing in the country.

He said many readymade garments industries in Bangladesh are using solar panels on their factory rooftops.

He also said the GGGI works to support developing countries and emerging economies to achieve sustainable and inclusive economic growth.

Professor Dr Muhammad Abdul Moyeen said awareness of sustainability has been created among stakeholders after the Rana Plaza collapse in the garments sector.

He said it is most important to maintain the ecological balance of the environment. "We will not deplete natural resources considering our next generation. We need measured energy consumption for overall development."

Professor Dr Muhammad Abdul Moyeen further said it is difficult to invest in green initiatives for small and medium enterprises (SMEs) due to capital shortage. As such, financial institutions should take this into consideration.

Mofiz Uddin Ahmed, additional secretary of the Financial Institutions Division, also took part in the conference.