Against the serene and stunning Odysseo Aquarium, serving as an apt backdrop for a discussion on sustainability and climate change, Standard Chartered Bank convened an engaging panel discussion on “Climate change impact and vulnerability of Africa and Small island nations – how the Mauritius IFC can facilitate transition financing?” The forum, hosted on 12 February 2024, featured a keynote address from Marisa Drew, Group Chief Sustainability Officer at Standard Chartered Bank.
Ms. Drew captivated the audience with an address that underlined the pressing need to embed sustainable finance into core business strategies, while detailing Standard Chartered’s dedication to green and transition finance. “We stand at a crossroads where adopting transition finance is not solely imperative but a chance to lead in establishing resilient economic frameworks, particularly for island nations such as Mauritius,” Drew articulated.
On being asked to unpack the concept of transition finance, she noted: “Transition is difficult to define. It is a fuzzy concept and means different things to different people. In context of the sustainability ecosystem, what we tend to mean is moving from practices that we know today to be unsustainable to something that, in the long term, is still going to be viable and productive. Even industries with very small emissions have sustainability challenges. It could be packaging in the sugar industry, or it could be the chemicals released in the fashion industry. Every single industry has its own definition of sustainability. Our definition of transition finance is to meet our clients on their respective journeys. You have to institute clear standards and principles for transition finance, but what is most important is to take your clients along with you.”
She noted that clients often resent being imposed upon with sustainability standards that may not be in line with their country mandates – and might be left with the feeling that they are being forced to bear the brunt of emissions in other countries rather than shoulder their own fair share of the wider, global sustainability issue.
Drew highlighted, “Our role is to merge the facilitation of capital with the enhancement of understanding amongst our clientele, thus driving actions towards a sustainable future.”
Featuring Marisa Drew as a stellar speaker, the panel was further enriched by insights from panel chair, Neetyanand Kowlessur, Acting Secretary of the Bank of Mauritius and head of the Climate Change Centre; moderator Rajnish Aubeeluck, Head of Client Coverage, CCIB, Mauritius at Standard Chartered Bank; Amanda Serumaga, UNDP Resident Representative for Mauritius and Seychelles; and Issam Sarkis, Chief Finance Officer at Aspen Global Incorporated. They delved into the fusion of innovative financial instruments and sustainable business endeavours that can allow the Mauritius IFC to take a leading role in the climate change movement.
Rajnish thanked Marisa for her insightful remarks and commented that one-size-fits-all indeed does not work for transition finance. He further noted, “Capital preservation is key for the financial system and the Bank of Mauritius is one of the foremost – if not the only – among progressive central banks on the continent to have set up a climate change centre well ahead of other jurisdictions.” He next asked Neetyanad Kowlessur: “With the climate change centre about to be operationalised, it would be interesting to understand on what pillars it is being built and what flexibility does it provide to commercial banks for sustainable finance coverage.“
Neetyanad Kowlessur provided the context for the establishment of the climate change centre, noting that Mauritius as a hospitality hub that offers beautiful beaches, world-class resorts and a pristine marine life clearly needed to take a pioneering stance in the sustainable finance space. He highlighted that Mauritius has committed to reducing its greenhouse gas emissions by 40% till 2030 and that this would require funding of US$6.5 billion.
He went on to mention the sustainable finance framework of Mauritius as unfolded by the Financial Services Commission and how it empowers businesses to proceed with their sustainability strategies.
Rajnish next turned to Amanda Serumaga, UNDP Resident Representative for Mauritius and Seychelles, and asked her for guidance on how to achieve the net zero targets set by Mauritius.
Amanda explained that, at the outset, you must have a framework in place and set specific targets on energy and emissions, noting that Mauritius is definitely on the right track.
Moving on, she underscored the importance of rethinking risk perception and the role of data. “One of the papers we released was how we are looking into the way credit agencies rate risk in the Global South vs in the developed world. The perception of risk, and not just the risk itself, hinders progress. Moreover, the challenge lies not in the scarcity of data but in its organisation into actionable knowledge,” she expressed.
She went on to note that even if we know what to achieve, how do we mobilise funding for the same? Further, in terms of the articulation of sustainability paths, there isn’t enough information doing the rounds for countries to take a fully educated call. For instance, she noted that research has shown that seagrass could offer a superior sustainability ecosystem to a forest. She stressed that such information is particularly significant for island economies such as Mauritius and Seychelles. We need to design sustainability ecosystems that speak to the reality on the ground, she highlighted.
Rajnish next turned to Issam Sarkis to ask what the pharma industry is doing to reduce its environmental impact.
In response to this, Issam Sarkis, Chief Finance Officer at Aspen Global Incorporated, touched upon the pharma industry’s environmental footprint. He mentioned that he was not trying to justify the pharma industry, but unfortunate realities on the ground do not allow it to be as sustainable as an ideal scenario would dictate. He stressed that in pharma in particular, the health implications of using defective or expired products meant that the rate of wastage was higher than in many others.
He rued, “Within the medical industry, quality, unfortunately, comes at the cost of waste. Another example is transport. Medicine needs to be transported in either ambient or cold chain conditions. This also creates a sustainability burden.”
He also emphasised that the pharmaceutical industry has seen a 15% reduction in Scope 2 emissions over the last seven years, but the challenge of Scope 3 emissions remains. At Aspen International, as a multinational operating for the last 25 years, he explained that the organisation has arrived at a sustainability strategy that does justice to its experience. For the last 5 years, we have been able to reduce Scope 1 emissions by 30% and Scope 2 and 3 emissions by 27%, he explained.
Finally, Rajnish Aubeeluck, the moderator and head of Client Coverage, CCIB, Mauritius at Standard Chartered Bank, emphasised the transformative power of financial ingenuity when he reflected on the bank’s role in structuring a debt transaction that addressed both fiscal strain and ocean conservation, christening it a ‘triple win’ scenario.
The evening’s discourse transitioned into an animated Q&A segment, with inquiries ranging from risk management to financing green initiatives. “The path towards a sustainable future is paved with collaborative and inventive endeavours. Forums such as this are not merely discussions; they are the impetus for transformation,” Drew concluded, capturing the essence of the event.
As the discussion wrapped up and the audience moved to a networking session over cocktails, the shared sentiment was one of enlightenment and a collective drive to champion sustainable change within the financial services sector. Standard Chartered, with visionaries like Marisa Drew, reaffirms its pivotal role in steering finance towards a greener horizon.
About Standard Chartered Bank Mauritius
Standard Chartered Bank Mauritius, established in 2002, is a prominent entity in the international banking group with a significant presence in dynamic markets across the globe. Dedicated to serving commercial, corporate, and institutional clients, the bank leverages its extensive network and local expertise to meet the banking needs across Asia, Africa, and the Middle East. With a robust team and deep-rooted values, Standard Chartered Mauritius aims to drive commerce and prosperity, embodying the brand promise of being ‘Here for good’. For more details, visit their official website.
