Kenya’s Central Bank sets 18-month deadline for banks to disclose climate risks
- The Central Bank of Kenya has given commercial banks 18 months to disclose the environmental impact of financed projects.
- CBK has introduced the Kenya Green Finance Taxonomy (KGFT) to classify what qualifies as 'green' under climate standards.
- Banks will be required to publicly disclose their exposure to climate-related risks, including investments in high greenhouse gas emission sectors.
The Central Bank of Kenya's initiative is a commendable step towards enhancing transparency and accountability in the banking sector regarding environmental impacts. However, the success of this initiative will depend on the effective implementation of the KGFT and the willingness of banks to adapt to these new standards. Continuous engagement and education will be crucial to ensure that banks not only comply but also genuinely commit to sustainable financing practices.
