SANTO DOMINGO. -The Superintendency of Banks (SB) announced this Thursday that it will carry out a pilot project to support financial intermediation entities, with the support of the World Bank Group, in order to classify loan portfolios according to the sectors and activities established in the Green Taxonomy of the Dominican Republic.
The importance of this initiative lies in the fundamental role that entities can play in promoting the green transition of the country's economy, thanks to the effective channeling of resources towards projects that are less harmful to the planet, highlights a press release from the entity.
In observance of World Environment Day, which is commemorated every June 5, the SB, in collaboration with the World Bank Group, held a workshop on Green Taxonomy and the management of environmental and social risks.
The press release emphasizes that it is important to highlight that the Dominican Republic's Green Taxonomy has been led by the Superintendency of the Securities Market, with the collaboration of the Ministry of Environment and other entities, with technical assistance from the International Finance Corporation (IFC), a member of the World Bank Group, with funds from Spain and the FIAS program.
"The Green Taxonomy is a system for identifying and classifying economic activities and assets that contribute substantially to achieving the country's environmental and climate objectives. It is designed as a tool to promote the financing of projects that are less harmful or have a neutral impact on the planet.".
The Superintendency points out that as a preliminary step to the creation of the pilot project, with the support of IFC, it carried out a diagnostic survey of 43 supervised entities, in order to determine the level of management of climate, environmental and social risks that the entities have been implementing and to know the situation of green finance in the country.
According to the survey, 88% of boards of directors and/or senior management recognize that environmental issues and climate change are relevant and have a material positive or negative financial impact.
However, only 44% of the entities consulted have designated a person responsible (committee, area or collaborator) for implementing environmental management actions and 32% have a policy that explicitly incorporates climate issues into strategic planning, business models, financial planning and other processes.
Workshop
The survey results were presented by the SB's Risk Monitoring Director, Carlos Rijo, during the Green Taxonomy and Environmental and Social Risk Management workshop.
The event took place at the JW Marriott hotel, with the participation of local authorities, national and international experts, as well as representatives of financial institutions.
The opening speech was given by the Mayor of Bancos, Julio Caminero, who emphasized the need for society as a whole to address the climate emergency and contribute to mitigating its impact from various areas of action.
Meanwhile, Rodrigo Pereira Porto, senior consultant at the World Bank, pointed out the high vulnerability of the Dominican Republic to the effects of climate change, due to its status as an island state.
Vishwas Vidyaranya, IFC technical consultant and co-founder of Ambire Global, who participated virtually, said that the financial sector is a critical part of the economy, making its participation in the green taxonomy particularly relevant.
Also addressing the attendees were Enmanuel Cedeño, Superintendent of the Stock Market; Clara Fernández Martín, Economic and Commercial Counselor of the Embassy of Spain; and Iván Marcel Cruz, representing the Ministry of the Environment.
