SUSTAINABLE BANKING
“ By offering sustainability-linked loans , banks incentivise businesses to lower their own carbon footprint ,” he notes . “ Through such mechanisms , financial institutions - either directly or indirectly - provide financing for green energy projects , promote sustainable practices , integrate climate-related risks into their lending decisions , and collaborate with various stakeholders to develop supportive policies and frameworks .
“ By leading these efforts , banks not only contribute to a sustainable future but also align themselves with the growing global demand for green finance .”
Despite some positive initiatives put into action at several financial institutions , too many portfolios of financial
institutions still fail to align with net zero principles .
“ Even among those that claim to be aligned , only 25 % of managed assets on average are actually covered by their respective net zero targets ,” cites Dr Alexander from a New Climate report .
Accelerating net zero initiatives : The role of AI For financial institutions yet to align with net zero principles , could the advent of AI help propel sustainability plans forward ?
For Hitachi ’ s Pablo , while AI can help significantly with data analysis and prediction , banks must implement the right strategy for AI implementation first and foremost .
170 July 2024