What will Asia be like in 10 years, if banks continue to support business ventures that pollute, degrade and warm the planet?
A new report by Fair Finance Asia, a network of civic society groups that works to clean up the region’s finance system, warns of the consequences of climate change and environmental degradation in Asia over the next decade.
More frequent floods, rising sea levels, and ocean acidification will pose severe problems for the economic and social stability of a region of lengthy coastlines and large river basins — if Asia’s banks fail to clean up their act.
A warmer climate by 2030 could mean millions of people in Asia will lose their homes and livelihoods, triggering economic losses and migrations from the hardest hit countries, which could worsen labour and human rights violations across the region.
The report, titled Asia’s Dystopian Future? Why Banks Need To Put Sustainable Finance Clearly In Their Sights, makes the point that the future will be hard on banks themselves, too. The risk of defaulting loans and stranded assets due to the impacts of climate change, environmental fall-out and abusive social practices will undermine the profitability of corporate borrowers and other bank customers.
Bernadette Victorio, regional programme lead for Fair Finance Asia and a contributor to the report, tells the Eco-Business Podcast that the risk assessment models of Asia’s banks are not fully informed about future climate and social impacts, and sweeping changes are needed to align the financing models of the region’s banking players with the United Nations’ Sustainable Development Goals and the Paris climate accord.
The Covid-19 pandemic should provide Asia’s banks with the impetus to pursue sustainable finance, as the region hatches plans to stimulate ailing economies. “We should be using Covid as a pretext for driving the sustainability agenda, not hiding from it,” she says.
Tune in as we talk about:
- Dystopian future: What Asia could be like by 2030
- Why the future is already here
- The risk of unsustainable banking — for banks
- Covid, an excuse to delay action?
- Is green finance too expensive?
- How banks help hit net zero targets
- Will banks change in time?
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