Wide Info Daily Regular Updates 
Sustainability financing is the support and facilitation by a financial institution for sustainable development. It creates value in economic, environmental and social terms. It also ensures and improves economic efficiency, prosperity, and economic competitiveness for today and tomorrow. It also means to protect and restore natural ecological systems, and enhance cultural diversity and social well-being. In sustainability financing, business or investment decisions are taken for the lasting benefit of both clients and society at large.
The UAE government is fully committed to make the country environmentally sustainable, build resilient economy and raise standard of living. This commitment forms a major part of the UAE Vision 2021. The Vision has also set a target to derive 24% of its total energy from clean energy resources.
The main focus of all the objectives is renewable energy but the proposals also put attention towards energy efficiency, low carbon, waste and water management.
United Arab Emirates is the only country with strategic plan for green economy, including food, transport, energy and infrastructure. Financial institutions, mainly banks, can play a leading role in the financing of sustainability projects.
The biggest bank of the region, National Bank of Abu Dhabi (NBAD), has undertaken multiple projects in this regard. The bank brought together a dedicated Sustainable Business team in August 2015 to recognize, assess, evaluate and recommend innovative financing projects that will support the development of renewable energy and sustainable businesses.
NBAD is collaborating with global consultancy PwC and the University of Cambridge for clean energy. NBAD has also committed to invest $ 10 Billion in the coming ten years for environmentally sustainable activities. NBAD is also the first bank in the region to sign up to the Equator Principles, a voluntary set of guidelines based on International Finance Corporation standards on social and environmental sustainability and the World Bank Group’s environmental, health and safety guidelines.
Other ways banks can contribute to sustainability are responsible lending, risk management, sector policies, energy related credit portfolio and green bonds. Green bonds in particular increase investors’ demands for engagement in environment related opportunities. Many green startups and companies seek investment and investors can integrate sustainability into their portfolio allocation for greater long term profitability. It’s a win-win situation for all – banks, people, investors and government.
Although UAE’s sustainable future faces many challenges, the country’s mission of sustainability can only be achieved through mutual interest, collaboration and interest of all stakeholders. The country is committed to accelerate towards national and regional green growth pathway and towards the much needed new world of clean energy. Through clear policies and bright vision, UAE is on the right path of becoming a positive force in sustainability through strong support by banking sector of the region.
