Risk Management Guidelines for Banking Sector
Second Deputy Governor of the Bank of Ghana, Mrs. Elsie Addo Awadzie, has disclosed that Bank of Ghana will soon conclude discussions on a Cooperation Agreement with International Finance Corporation (IFC).
According to her, the agreement will provide technical support for organizational strengthening at the Bank of Ghana, and for the development of Environmental and Social Risk Management (ESRM) guidelines for both the Bank of Ghana and the banking industry.
Delivering her speech at the Sustainable Banking Principles Stakeholders Forum, held in Accra, she said the IFC will support the implementation of ESRM guidelines and the development of monitoring procedures for Bank of Ghana to supervise their implementation.
“It will assist in the identification of sustainable lending opportunities and practices in Ghana, and last but not least, support knowledge management, communication and outreach activities in relation to ESRM,” she stressed.
The agreement comes at a time that central banks around the world have adopted, sound environmental and social practices as part of Sustainable Banking Principles (SBP).
According to the Deputy Governor, this will enable banks incorporate ESRM within their business activities and operational procedures.
BoG Proposes Seven General Principles
She disclosed that the Central Bank is collaborating with the Ghana Association of Bankers (GAB) and Environmental Protection Agency (EPA) to propose some seven principles which will affect five relevant sectors of the Ghanaian economy.
The five sectors are Manufacturing, Energy and Power, Construction and Real Estate, Mining, Oil and Gas, and Agricultural and Forestry.
The proposed principles are for promoting good corporate governance and ethical standards; Promoting gender equality; Promoting financial inclusion; Promoting financial inclusions amongst others.
IFC, which has signed an agreement with the Bank of Ghana, over the years has led the move from normal banking to sustainable banking, backing regulators in its efforts of providing its technical expertise and sharing experience in implementing the IFC’s environmental and social performance standards.
The ESRM programmes are implemented in partnership with Switzerland’s State Secretariat for Economic Affairs (SECO) and other partners.
By: Emmanuel Yeboah Britwum