The Worshipful Company of International Bankers and Deutsche Bank hosted an event on 3rd September and Senior Warden Elect Tim Skeet commented on the discussions:
‘ESG in practice’, an event organised by the WCIB and hosted by Deutsche Bank, offered a good hard look at what those three letters mean in practice. ESG and more specifically green finance is a ‘hot topic’. Highly regulated financial institutions are under an obligation to come to terms with reporting their emissions, but this is fraught with challenge. This discussion looked not just at the City’s work supporting a green agenda, but ranged more widely to offer a powerful international perspective with a German flavour.
This event brought together three distinguished experts in the business of mobilising finance in pursuit of meaningful green and sustainable finance objectives. Gerald Podobnik (a Freeman of the Company), the event’s host and key speaker, outlined his bank’s approach. Alderman Alison Gowman, sustainable finance champion at the City of London and founder of the Livery Climate Action Group (of which WCIB is a proud and active member) provided a City perspective, and Madison Reamsbottom, Strategy head at the UK Sustainable Investment and Finance Association (and also a Freeman of the Company), chaired the event.
Gerald Podobnik provided an eloquent and clear overview of how one major European bank approaches the subject. As a banker charged with overseeing the finance side of the bank, he is clear that ‘only what gets measured, gets done’. Here then is the first issue- how, despite the vast amount written and discussed, do we arrive at useful metrics and accurate definitions? These can be fluid and elusive. Measurements must be baked into the bank’s overall incentives structures, and good metrics have to be fully integrated into the bank’s business as usual (BAU). Banks must not of course lose sight of the fact that they need to make money so getting the right mix, balance and focus is critical.
Gerald, besides his work as a senior banking executive also sits as a member of the German Government Sustainable Finance Advisory Committee. He reminded the listeners that bankers do need to listen carefully and understand the views of the real economy and wider society. Nevertheless, getting the bank’s approach right should offer a real business opportunity.
Alison Gowman in her opening remarks once more outlined the astonishing work done by the City of London to ‘green’ the Square Mile, emphasised the contributions of the Green Finance Institute, founded by the City, and pointed to the publication of the Transition Finance Market Review. Alison also emphasised the importance of harnessing the expertise and specialist experience found within many of the livery companies, to ensure they play their part and show leadership beyond their historical roles as guardians of past traditions.
Obstacles remain- fluid or missing guidelines or regulation, poor or inadequate data, the ever growing risk of reputational damage, the influence of pressure groups or greenwashing accusations- these collectively represent a minefield. However, as was concluded, it is for the bankers to clearly articulate their mission and explain what they do.
All the work, expense and creative energy being directed at one of the most pressing issues of our time by the financial services sector is underappreciated, so more must and can be done to get word out and clearly show leadership. This task falls on all our shoulders.
Tim Skeet
Senior Warden Elect
Worshipful Company of International Bankers