MANILA – The Bangko Sentral ng Pilipinas (BSP) has vowed to further advocate for greater contribution of the financial sector on the goal towards having environmentally responsible and sustainable policies to help address climate change.
In a statement on Wednesday, BSP Governor Benjamin Diokno said the Philippine central bank is one with the Central Banks and Supervisors’ Network for Greening the Financial System (NGFS) in calling for the achievement of climate goals under the Paris Climate Agreement, as authorities are discussing this issue in the ongoing 26th United Nations Climate Change Conference of Parties (COP26) summit in Glasgow, Scotland.
Diokno said monetary regulators and financial institutions “should recognize their important role in contributing to the transition to a low-carbon economy.”
“As stewards of the financial sector, we should all commit to act with urgency in achieving the desired emissions reduction targets and in promoting the sustainability agenda,” he said.
Diokno thus committed the BSP’s contributions by pushing for the implementation of initiatives under the Sustainable Central Banking (SCB) program “to foster environmentally responsible and sustainable policies and work practices.”
He said the program “embodies the essential roles of the BSP as an enabler, mobilizer, and doer in relation to advocating sustainability principles in the financial system.”
Diokno added the BSP will “provide an enabling regulatory environment to equip banks in managing climate change, environmental, and social risks, and at the same time, unlock financing to economic activities contributing to sustainable development.”
Other measures towards this bid include assisting banks in their climate stress-testing exercises and the collection of more granular data on climate, and environmental and social risks exposure; encouraging a collaborative move in the financial sector and harmonizing policies and aligning initiatives with the objectives and strategies of the Philippine Sustainable Finance Roadmap and Guiding Principles; and to build partnerships to intensify awareness and capacity-building activities for the financial sector.
“We need to take advantage of the momentum calling for action, and step up our response towards climate change,” Diokno added.
The BSP said it became a plenary member of the NGFS, a group of central banks and financial supervisors that voluntarily exchange experiences and best practices to enhance the financial sector’s environment and climate risk management and accelerate the transition towards a sustainable economy, in July 2020. (PNA)