China Construction Bank
China Construction Bank (CCB) is one of the four largest state-owned banks in China, it was founded in October 1954 and is headquartered in Beijing. The total capital value ranks among the top listed banks worldwide (CCB, 2022).
In addition, as a globally systemically important bank (G-SIB), China Construction Bank plays a vital role in supporting global economic growth and development. However, the collapse of China Construction Bank would pose the risk of a financial crisis.
China Construction Bank is developing a green finance business to meet the United Nations Sustainable Development Goals, which include green credit, green bonds, green leasing, etc. By the end of September 2022, CCB's green loans amounted to RMB 2.6 trillion (CCB, 2022).
What are UN SDGS and How are they relevant to green finance? 
The UN Sustainable Development Goals
The Sustainable Development Goals (SDGs) are a new set of development goals proposed by 193 member states at the UN Summit in 2015. It covers 17 SDGs that address the three core aspects of social progress, economic development and environmental protection. It aims to eradicate poverty, protect the planet's ecosystem and achieve shared prosperity for all people worldwide between 2015 and 2030. All the SDGs are interlinked, but I'll be picking out some of them in my blog (United Nations, 2023).
Goal 7: Affordable and Clean Energy
Energy is an issue of concern to the world today. This goal aims to ensure that everyone has access to affordable, reliable and sustainable energy (The Global Goals, 2023).
The Russia-Ukraine conflict has triggered a global energy crisis in 2022. As a result of inflation and the energy crisis across Europe, the cost of living for European citizens has risen and high gas and electricity bills have become unaffordable for many households. European citizens have embarked on a series of strikes for pay rises which hinder economic development. It is therefore important to develop new sustainable energy sources rather than relying on a single source (Carbonaro, 2022).
Goal 8: Decent Work and Economic Growth
The goal is committed to promoting sustained, inclusive and sustainable economic growth, achieving full and productive employment and ensuring decent work for everyone (The Global Goals, 2023).
The global economy has been hampered by the New Crown epidemic, with closure policies in many parts of China, and even outright shutdowns in companies with severe outbreaks (IMF, 2023). The long periods of unprofitable company losses have caused many companies in China to go bankrupt and many workers to lose their jobs. On the other hand, China's policy has hindered foreign trade and reduced imports. As one of the world's largest exporters, capacity constraints in production and logistics have slowed down the supply chain and increased global supply pressures and inflation. Therefore, to ensure economic growth, reducing unemployment is a top priority.
Goal 9: Industry, Innovation and Infrastructure
The goal is to build risk-resilient infrastructures, promote sustainable industries and drive innovation (The Global Goals, 2023).
Chinese banks are currently in the process of digital transformation, but among other things, digital equipment and services consume a large amount of electricity, and the disposal of digital equipment at the end of its useful life will have a negative impact on the environment. Chinese banks are offering green credits to companies to develop equipment in order to minimise the level of environmental pollution caused by the banks' digital transformation process (Peng, 2022). Achieving this goal requires companies to consciously protect the environment, as well as increased government control and funding.
References:
Carbonaro, G (2022) How are European countries helping people pay their energy bills?, Euronews. [online] Available at: https://www.euronews.com/next/2022/10/26/energy-bills-are-soaring-in-europe-what-are-countries-doing-to-help-you-pay-them (Accessed 24th Feb 2023).
CCB (2021) China Construction Bank 2021 Environmental Information Disclosure (TCFD) Report. [online] Available at: http://www.ccb.com/eng/2022-12/29/article_2022122909544730369.shtml (Accessed 24th Feb 2023).
IMF (2023) Inflation Peaking amid Low Growth. [online] Available at: https://www.imf.org/en/Publications/WEO/Issues/2023/01/31/world-economic-outlook-update-january-2023 (Accessed 24th Feb 2023).
Peng, G (2022) 'Digitalization in banking: How to really reap the benefits', World Economic Forum. [online] Available at: https://www.weforum.org/agenda/2022/05/heres-how-to-really-reap-the-benefits-of-the-digitalization-in-banking-trend/ (Accessed 24th Feb 2023).
The Global Goals (2023) Overcoming the World’s Challenges - The Global Goals. [online] Available at: https://www.globalgoals.org/ (Accessed 24th Feb 2023).
Un.org (2023) THE 17 GOALS | Sustainable Developm].ent. [online] Available at: https://sdgs.un.org/goals (Accessed 24th Feb 2023).
Comments
Post a Comment