Banks and corporates face a growing demand from shareholders, customers, investors and other stakeholders, for their trade finance transactions to actively support the production of goods or services in a manner that minimises adverse environmental and social impacts and promotes environmental and social benefits.

Standard Bank has been working with the International Chamber of Commerce (ICC) Banking Commission, co-leading a working group tasked with equipping banks to encourage sustainable finance trade practices by:

• Providing clarity to banks on the implementation of sustainability policy and standards through the development of guidelines on sustainable trade finance, with a focus on short-term trade finance. Initiatives are also underway to support a better understanding of the applicable voluntary standards, certification schemes and other approaches that can mitigate ESG risks. Educational and training programmes for trade finance professionals are being developed.
• Promoting industry-wide consensus on a definition for sustainable trade finance. The aim is to discourage inaccurate use of the term and to prevent ‘greenwashing,’ a practice in which trade transactions are inaccurately labelled as sustainable without any means of verifying this.
• Monitoring and driving the development of industry initiatives around environmental and social risks and finance provision.

Given that trade finance often involves more than one bank, having a common framework to guide banks is valuable. An overarching framework enables banks to consistently and accurately assess trade risk while developing appropriate responses that promote sustainable trade finance.

Standard Bank’s commitment to the ICC Banking Commission’s sustainable trade finance process dovetails with the aims of the African Union’s Agenda 2063 which highlights the need for trade and investment infrastructure to connect Africa. As an African bank clear in its purpose to drive Africa’s growth, partnering with the ICC to develop standards and rules in trade, in general, and universally adopted global best practice in sustainable trade finance specifically, supports our purpose to facilitate trade and investment flows between African countries, and between African countries and global markets in a way that promotes sustainable and inclusive economic growth.

Vinod Madhavan

HEAD, TRADE, STANDARD BANK GROUP

As a global bank linking international capital to African opportunity, Standard Bank is alive to the pressures on global multinationals and other businesses to ‘green their supply chains’ - by meeting the growing social, economic and environmental expectations of consumers, global legislation and society.

Nigel Beck

HEAD, SUSTAINABLE FINANCE, STANDARD BANK GROUP

Standard Bank’s direct involvement in assisting the ICC build an easy-to-use process and tool, defining and enabling sustainable trade finance globally, is part of our journey to embed our SEE framework into our product offering, ensuring that our lending decisions and business practices evolve in a way that produces value for clients and society at large.