Investing in the green revolution
Many countries around the world try and reach the goal set at COP26 of reaching Net Zero by 2050, and everyone has a part to play in the ongoing climate emergency gripping the planet, according to the United Nations.
At the most recent climate conference of the UN, the organisation outlined some of the key challenges we face in tackling the world try and reach the ambitious goal set at COP26 of reaching Net Zero by 2050. A critical decade has been entered in the battle against climate change. Global emissions must be reduced by nearly 43% by 2030 to keep global temperature rises within the 2 degrees Celsius limit.
But how the banking sector is adapting to the challenge, since indeed money talks and the 'Green Revolution' requires substantial investment to truly make a difference. The shift to sustainability has become a sector-wide initiative and banking leaders are spearheading projects that align with the UN’s targets. Sustainability in banking is about strategic planning and execution of the banking corporations and the business activities while taking into consideration the three main pillars for sustainability: Environment, Social and Governance.
One of the benefits for the banking sector when investing in sustainable businesses is to be perceived as being legitimate and environmentally responsible. Profit is a considerable motivator for banks, and businesses that adopt sustainable practices may see increased margins, leading to further investment. Today one of the classic opportunities for businesses to boost their profit is to improve a business efficiency.
In conclusion, the global financial system is on to recognize the benefits of green investments, while banking leaders are proactively pursuing projects aimed at reducing emissions.