Nairobi, November 20, 2024 : The Kenya Bankers Association (KBA), in collaboration with IFC and WWF Kenya have today launched the revamped Sustainable Finance Guiding Principles and the Landscape of Sustainable Finance in Kenya’s Banking Industry Report as part of ongoing efforts to deepen financial inclusion and sustainability within Kenya’s financial services sector.
Developed with IFC’s support, the revamped Sustainable Finance Guiding Principles provide a robust framework for banks to integrate Environmental, Social, and Governance (ESG) considerations into their operations. Alignment with global standards fosters responsible lending, sustainable investments, and innovative financial solutions that address Kenya’s socio-economic and environmental challenges.
The Landscape Report, supported by WWF-Kenya, highlights key achievements and challenges in sustainable finance. The report indicates that gross loans across 11 key sectors grew by 23 percent since 2020, reaching Sh3.6 trillion in 2022, with MSMEs receiving Sh783.3 billion. However, the report cites challenges such as high costs for sustainability-linked bonds, inconsistent sustainability reporting, and limited data standardization persist. The report identifies opportunities for further investment in green growth sectors, including agriculture, energy, water, manufacturing, and real estate.
Quotes by Partners & Speakers
“Sustainable business models and green financing are not mere trends—they are essential pathways for ensuring long-term economic stability and environmental stewardship. By integrating sustainability into our lending and investment decisions, we can help mitigate climate risks, support green projects, and grow our economies while safeguarding the future of our planet.” – Betty Korir, Kenya Bankers Association Vice Chairperson
“The Sustainable Finance Initiative has enabled over 50,000 bank employees to make lending decisions that benefit the environment, society, and economy. With the revamped guiding principles, the banking industry is better equipped to adopt best practices in governance and risk management, further driving innovation and financial inclusion.” – Raimond Molenje, KBA Ag. CEO
WWF Kenya Quote
‘’Kenya is endowed with rich natural resources, a dynamic entrepreneurial spirit, and a robust financial sector that provides a unique platform to champion sustainability. However, with these opportunities come significant responsibilities to adopt an integrated approach that aligns economic activities with the sustainable development agenda. WWF-Kenya will continue to collaborate with the Kenya Bankers Association because we believe in a future of financial prosperity grounded in sustainability – a safe legacy that connects people, nature, and the economy.’’— Mohamed Awer, WWF-Kenya Chief Executive Officer.’’
IFC Quote
‘’Application of the SFI principles is important for Kenyan banks as it will promote financing for renewable energy, energy efficiency, sustainable agriculture, and other eco-friendly projects. It will also encourage banks to support projects that enhance social inclusion, gender equality, affordable housing, healthcare, and education. Finally, it will help banks manage environmental and social risks, making informed decisions to protect financial stability’’.— Mary Potter Peschka, IFC Regional Director.
GIZ Quote
“As Sustainable Agricultural Systems and Policies (AgSys) through Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, we have initiated a partnership with Kenya Bankers Association (KBA) to support financial institutions in exploring sustainable financing opportunities for the agricultural sector. We believe that how we finance our agri-food systems – from both public and private sources of capital – may be the ultimate game changer since financing is both a driver of food system inefficiencies and an essential ingredient to their transformation. We recognize that climate change impacts how financial institutions perceive risks especially in the agricultural sector. Therefore, our partnership will enable financial institutions to implement sustainable financing options such as blended finance for investments into nature-based solutions that benefit the planet, beneficiaries, and the financial institutions.’’— Sophia Baumert, Project Manager, Sustainable Agricultural Systems and Policies (AgSys)
Winner of Sustainable Finance Catalyst Awards 2024
During the summit, 26 banks were recognized for their excellence in adopting sustainable finance practices as follows:
Overall Winners
- 1st Place: Cooperative Bank
- 2nd Place: KCB Bank
- 3rd Place: ABSA Bank
Winners in Each Category
- Best in Sustainable Finance: KCB Bank (1st), ABSA Bank (2nd), NCBA Bank (3rd)
- Best Case Study – Retail MSME: Cooperative Bank (1st), National Bank of Kenya (2nd), Sidian Bank (3rd)
- Best Client Case Study – Commercial: Cooperative Bank (1st), KCB Bank (2nd), Stanbic Bank (3rd)
- Best Bank Case Study – Bank Operations: Diamond Trust Bank (1st), Cooperative Bank (2nd), I&M Bank (3rd)
- Best Client Case Study – Promoting Gender Inclusivity: KCB Bank (1st), KWFT Bank (2nd), Cooperative Bank (3rd)
- Best Bank Case Study – Promoting PWD Accessibility: KCB Bank (1st), ABSA Bank & CO-OP Bank (tie for 2nd), DIB Bank (3rd)
- Most Innovative Bank: ABSA Bank & CO-OP Bank (tie for 1st), Equity Bank (2nd), I&M Bank (3rd)
- Most Improved Bank: DIB Bank Kenya(1st ) DTB Bank( 2nd) Credit Bank (3rd)
In 2024, a total of forty-nine entries were submitted by banks, an increase from forty-three in the year 2023. The judging panel for the Sustainable Finance Catalyst Awards constitutes the following:
- Bernard Kiragu-Managing Partner, Scribe Services (Chairperson)
- Dan Ndenga – Co-founder of Miltech
- Peter Muriu – Senior Lecturer, University of Nairobi
- Mumbi Maria Wachira-Lecturer, Strathmore University Business School
Notes to the editor
About the Sustainable Finance Guiding Principles & Industry Standards
The Kenya banking industry in March 2015 adopted the Sustainable Finance Initiative (SFI) Guiding Principles that guide the banks in balancing their business goals with the economy’s development priorities and socio-environmental concerns. The SFI Principles that were officially launched by the Central Bank of Kenya Governor Dr. Patrick Njoroge on 1st December 2015 are grounded in three main priorities, namely equipping the financial services sector to perform optimally in the area of comprehensive risk management; enhancing business practice, leadership and governance; and promoting industry growth and development by fostering a culture of innovation and inclusivity enabled by new technology. The Principles draw from and harmonize several global best practice standards, including the Equator Principles, IFC Performance Standards, Nigerian Sustainable Banking Principles, African Development Bank (AfDB) Green Growth Policy, Global Reporting Initiative (GRI) Reporting Guidelines, UNEP Finance Initiative (UNEP-FI) Guidelines, UN Global Compact Principles, ISO 26000:2010, and Kenya’s National Climate Change Policy (draft).
About the Kenya Bankers Association
KBA (www.kba.co.ke) was founded on 16th July 1962. Today, KBA is the financial sector’s leading advocacy group and banking industry umbrella body that represents total assets in excess of USD 60 billion. KBA has evolved and broadened its function to include advocacy on behalf of the banking industry and championing financial sector development through strategic projects such as the launch of the industry’s first P2P digital payments platform PesaLink. In line with the Government’s policy on public-private partnerships, KBA and Central Bank of Kenya have implemented key projects such as modernization of the National Payments System through the Automated Clearing House, implementing the Real Time Gross Settlement System (RTGS), and the Kenya Credit Information Sharing Initiative. The KBA members are comprised of commercial banks and deposit taking microfinance banks.
About WWF Kenya
World Wide Fund for Nature Kenya (WWF-Kenya) is a locally registered non-governmental conservation organization; an affiliate of WWF International. WWF has been working in Kenya since 1962 alongside the government, civil society, private sector organizations, and local communities to contribute towards providing an enabling environment for the achievement of a healthy natural environment supporting people and sustainable development in Kenya.
