Tier 4 financial institutions have been urged to integrate Environmental, Social, and Governance (ESG) principles in their planning and operations.
Speaking during a training for Tier 4 by aBi Finance at Fairway Hotel in Kampala, Moses Bwire, an Investment Manager overseeing Green Growth and Business Development Services at aBi Finance Limited said it is crucial to integrate ESG in all operations of financial institutions.
“The core idea of ESG is to ensure that as financial institutions develop and offer products, they encourage environmental protection. Sustainability, in this context, means that as financial institutions generate profits, they must also prioritize the well-being of the environment, the people they serve, and ensure sound governance practices,” Bwire said.
He said that through the training, they seek to bridge a knowledge gap among the financial institutions.
“We’ve identified a knowledge gap, particularly within Tier 4 institutions, which is why we have invited them from across the country for this training,” Bwire said.
Bwire explained that through they are set to hold 18 training sessions for Tier 4 financial institutions across the country, including journalists who will also be trained to ensure informed reporting on ESG issues.
The trainings are conducted together with the Uganda Institute of Banking and Financial Services (UIBFS) .
Noah Owomugisha, the Head of Impact and Sustainability at aBi Finance said it is high time financial institutions implemented ESG.
“ESG and sustainability are not some distant concern. You are already experiencing the impacts – losses due to climate-related events, bad loan portfolios affected by environmental changes, and even job security concerns related to AI. These are real issues we need to address,” Owomugisha said.
He explained that aBi Finance also helps financial institutions adhere to ESG principles.
“Our capacity building efforts are comprehensive. For example, if you identify unbanked but critical populations, such as refugees, we can support your branch expansion into those areas. We also train your staff on aspects beyond basic credit, including social inclusion, good governance to minimize loan defaults, and the critical issue of environmental sustainability in light of climate change. Our goal is to ensure responsible and impactful financing,” Owomugisha said.
Roger Mugisha Shilling, the Head of Corporate Affairs at Letshego Uganda Limited, underscored the need developing products and services that benefit communities, build stakeholder trust, and ensure future relevance.
He said such products benefit both the financial institutions, members of the public and the environment they serve in.