On 24 July 2020, on behalf of the Life After Coal (LAC) campaign, the Centre for Environmental Rights submitted comments on national treasury’s draft Technical Paper on Financing a Sustainable Economy.
About National Treasury’s Draft Technical Paper
The Draft Paper is a framework for financial institutions to better disclose information on their green practices and investments in order for interested and affected stakeholders to assess how financial institutions are taking account of climate change and other social and environmental risks.
In addition, the Draft Paper does not deal with all sustainable finance instruments and broader environmental, social and governance (‘ESG’) issues but represents the first formal steps towards developing a comprehensive approach to sustainable finance for the financial sector. In this regard, the Draft Paper aims to:
- Harmonise definitions and disclosure standards; and
- Guide the governance approaches needed to effectively identify, quantify and manage such risks within SA’s financial institutions and regulatory activities.
According to the Draft Paper, National Treasury convened a working group of financial sector regulatory agencies and industry associations on a voluntary basis. The Draft Paper includes draft recommendations on sustainable finance initiatives to be undertaken in banking, insurance, retirement funds, asset management and capital markets. We note that the Draft Paper was released for stakeholder comment, to strengthen the recommendations and develop a comprehensive approach and action plan to encourage the financial sector to play its role in sustainable finance and development.