By Diane Silcock
The Development Bank of Southern Africa (DBSA) has released a groundbreaking report that addresses the challenge of reducing its impact on nature and biodiversity. Entitled “a case study on nature data”, it was commissioned by the African Natural Capital Alliance (ANCA) and co-published by the DBSA and Oliver Wyman.
The DBSA was inspired by the Taskforce on Nature-related Financial Disclosures (TNFD) and is leading the way on how it can advance integrating nature and climate finance into its decision-making process.
DBSA’s head of ESG, Siloshini Naidoo emphasises the commitment to sustainable development in Africa, saying, “Our collaboration with ANCA and Oliver Wyman underlines our dedication to promoting long-term prosperity for the continent through environmentally-conscious investments.”
Some key recommendations for the financial sector that have emerged from the report include that African banks should consider embedding clauses into loan agreements that actively guide projects away from areas where biodiversity is under threat.
Tony Goldner, executive director of the TNFD, welcomed the report saying, “The case study will serve as a useful reference guide for financial institutions and corporates on how to assess nature risks in sensitive locations, and to deliver sustainable infrastructure development alongside environmental stewardship.”
Dorothy Maseke, head of secretariat at the ANCA, said, “At ANCA we recognise the immense potential of the continent’s natural capital. However, unlocking this potential requires robust methodologies to assess and manage nature-related risks and opportunities. This white paper showcases a carefully crafted approach that leverages data, partnerships, and innovative tools to ensure nature-positive investments. It also demonstrates the commitment and capability of African institutions to drive sustainable development.”
Companies’ shift towards ESG compliance is becoming essential
With global concerns around climate change, social justice and ethical governance practices, ESG compliance and sustainability are topics of discussion that are becoming increasingly commonplace around boardroom tables. This report serves as an encouragement to companies to rethink their value propositions as investors and stakeholders scrutinise their commitment towards sustainability.
In the report, DBSA’s CEO, Boitumelo Mosako says, “Financial institutions are well placed to address global biodiversity loss at scale. Business as usual is not an appropriate scenario. We need to follow a transformative and a whole society/economy approach that can help countries balance their obligations.”
Naidoo explains that the DBSA through working with the GCF (Green Climate Fund) and GEF (Global Environmental Facility), enables it to tap into concessional finance ring-fenced to sustainable/green use of proceeds to promote and catalyse more responsible investment from the greater financial sector. With nature-based solutions, DBSA therefore aims to use these opportunities to scale up implementation and bring in funding through blended financing structures.
Naidoo believes the DBSA has a niche advantage through their project preparation facilities, which allows for involvement in infrastructure projects at an early stage when feasibility studies are conducted, thereby enabling them to integrate principles of sustainability from the start.
“In the development of our ESG roadmap,” she says, “we define what ESG materiality means to DBSA at an operational and a transactional level.”
She adds, “Sustainability is at the very centre of what we do, which ensures that we enable longer term resilience in every investment we make.”
