Sustainability reporting: What are the new challenges for banks in Africa?

Banks within Africa are aligning their corporate goals with Sustainable Development Goals as the push towards people over profits gains momentum. In a recent interview with CNBC Africa, Dr. James Mwangi, the Equity Group CEO, shed light on the importance of sustainability reporting and how African businesses can measure their impact. Dr. Mwangi emphasized the global focus on sustainability, pointing out that climate change has become a topic of great interest to people. He highlighted the need for a shift towards sustainable practices to ensure that future generations can also benefit from the environment. Equity Group has been a pioneer in embracing sustainability, adopting a shared prosperity model that focuses on social impact and environmental conservation. By launching a sustainability report, the bank aims to inspire others to commit to saving the planet and contributing to a more sustainable future. This commitment, according to Dr. Mwangi, should not be sacrificed, even in times of economic challenges. The sustainability report serves as a measure of the bank's progress and a reminder of the importance of accountability in sustainability efforts. It highlights Equity's comprehensive approach to sustainability, encompassing social programs, environmental initiatives, and innovations. The bank's social programs include health, education, leadership, agriculture, and support for small and medium enterprises. In terms of environmental initiatives, Equity has focused on tree planting, reducing emissions, supporting clean energy, and assisting small-scale farmers in adapting to climate change. Moreover, the bank has collaborated with large mining companies to promote ESG standards and sustainable energy generation in regions like the Democratic Republic of Congo. Dr. Mwangi also shared insights into the financial impact of Equity's sustainability efforts. The Equity Group Foundation, responsible for ESG implementation, has an annual budget of $70 million dedicated to sustainability work. This funding supports activities in energy, agriculture, scholarships, and education, aimed at addressing poverty and promoting social integration. Additionally, Equity plans to invest two percent of its revenue in the twin engine business model, amounting to approximately $70 million this year. The bank's partnerships with donors and other organizations have been instrumental in achieving scalability and fostering government collaborations. Dr. Mwangi emphasized that sustainability is not an expense but an investment in doing business, ensuring that it remains a priority regardless of profit margins. By prioritizing sustainability, Equity Group is setting a precedent for African businesses to align their corporate strategies with broader sustainable development goals, contributing to a more environmentally conscious and socially responsible future.