'Financial institutions ready to invest in green initiatives'

Key corporations in every industry and a large number of financial institutions, including banks, equity firms and pension funds, are now coming forward to invest in initiatives that aim for biodiversity conservation and sustainable development, according to a World Bank official.

“Today, it is interesting to see that in every sector of industry, there are best-in-class companies which completely understand that their future profitability is absolutely linked to safeguarding environment and investing in sustainable development,” Rachel Kyte, vice-president and head of network of sustainable development at the World Bank, told Business Standard. Speaking on the sidelines of the recently-concluded global Convention on Biological Diversity here, she said the leadership in this regard was increasingly coming from middle income companies, which realised they would be generating fossil carbon at some point.

 

Today, any company that has huge exposure to carbon emissions is being considered not competitive, she added. According to Kyte, there are also financial institutions that demonstrate concern for protection of the environment.

Explaining the reasons for the World Bank’s increasing investments, Kyte said India was a growing nation and the bank could show the example of India to the world. Currently, the World Bank’s investment in India is $23 billion (Rs 1.24 lakh crore), which includes an investment of $23 million in a biodiversity project. In all, the bank is executing 76 projects, which are expected to be completed over five years. Sustainable development accounted for 70 per cent of all the work the World Bank undertakes, said Kyte.

Stating the world’s urban population was growing at a rapid pace, Kyte emphasised the need for increasing investments in urban infrastructure and expansion of social safety measures, especially for the poor.

Speaking about the effects of the global slowdown, she said the World Bank was “very carefully” managing its resources now as the bank’s income was not as much as it used to be earlier.