(Nairobi, 20 April 2018) The United Nations Sustainable Stock Exchanges (SSE) initiative addressed an African Securities Exchanges Association (ASEA) seminar on sustainable finance product and market innovations.
The SSE’s presentation covered the innovative practices of stock exchanges around the world aimed at promoting investment into SDG sectors, as well as other innovative responsible investment products and services introduced by investment service providers. Attention was paid to both the risks and growth opportunities offered by the climate transition and SDGs. Sustainability reporting and green finance projects were some of the key issues addressed; alongside strategies to assist the region in attracting sustainable finance. SSE work on green finance was highlighted including key lessons learned from the SSE guidance recently launched at COP23 in Bonn. The presentation covered new explicitly labelled sustainability themed investment products (e.g. green bonds, water bonds, ESG indices and funds), with special emphasis on applications in African markets.
“Sustainable finance has long been at the forefront of market innovations, pioneering work in areas such as smart beta equity indices and sustainability themed bonds,” said Anthony Miller, Coordinator of the Sustainable Stock Exchanges initiative. “Stock exchanges and asset managers in Africa have been among these pioneers and that’s why we see markets like Egypt and South Africa with ESG indices that were introduced more than ten years ago; we see the introduction of green bonds and water bonds as well as dozens of other sustainability themed investment funds.”
More than a dozen stock exchanges in Africa are members of the SSE initiative, including the exchanges of Botswana, Egypt, Kenya, Morocco, Namibia, Nigeria, Rwanda, Tanzania, Tunisia, Uganda, Zimbabwe, as well as the Western African markets covered by the BVRM exchange (Benin, Burkina Faso, Guinea Bissau, Côte d’Ivoire, Mali, Niger, Senegal, and Togo). The SSE held its international Executive Dialogue on Green Finance in Nairobi in 2016 which was the start of the work programme that lead to the launch of the SSE guidance on green finance at COP23 in 2017.
ASEA’s annual Building African Financial Markets (BAFM) seminar first took place in 2012 in Johannesburg, and is now in its 7th year. Hosted by the Nairobi Securities Exchange, participants exchanged ideas on how new financial technologies and products could strengthen the sustainable development of their economies. The two-day conference was opened by the president of ASEA Mr. Oscar Onyema (CEO of the Nigerian Stock Exchange), Mr. Georffrey Odundo the CEO of the Nairobi Securities Exchange and Mr. Paul Muthaura the CEO of the Capital Market Authority of Kenya. The event featured high-level discussion among key capital market stakeholders including regulators, exchanges, investors, issuers and international and regional experts to deliver their views on the challenges and opportunities of financial innovation as a lever for the growth and sustainable development of African financial markets. “Incorporation of new and efficient ways of investing in the capital markets through technology and other creative innovations targeted at direct linkages to the investing public, supported by an enabling regulatory framework, will be a significant stride towards resource mobilization that will result in transformative economic development,” said Georffrey Odundo, CEO of the Nairobi Securities Exchange.
