The eco.business Development Facility for Latin America and the Caribbean has partnered with the Ecuadorian Association of Banks (ASOBANCA) and the Ecuadorian Center of Resource Efficiency (CEER) to develop 12 sectoral guidelines that will instruct local banks in enhancing their environmental and social (E&S) risks and mitigation strategies, as well as identifying new, sustainable business opportunities within important sectors of Ecuador’s economy.
The guidelines are currently being specially prepared for three of the eco.business Fund’s target sectors: agriculture, forestry, and aquaculture. Designed to supplement and inform the banks’ environmental and social management systems (ESMS), the voluntary guidelines will provide expert advice on identifying and responding to sector-specific issues among the banks’ clients in activities such as banana, coffee and cacao cultivation, shrimp farming, production of cut flowers, and cattle farming. The guidelines will also support banks in expanding their product offering to finance sustainable business practices in these sectors. Through this dual-pronged approach – mitigating potential negative effects and supporting positive impact – the partners aim to anchor environmentally and socially responsible decision-making into the operations of Ecuadorian producers as well as the financial system that supports them.
Ms. Susanne Berghaus, Chairperson of the eco.business Development Facility, stated: “We are excited about this new partnership with ASOBANCA and CEER. The E&S guidelines that we are developing will be part of the banks’ ESMS which can identify and mitigate the potential environmental and social risks of a planned investment. Not only does this contribute to the transformation towards a green financial system, it will also grow green businesses in Ecuador. In this way, we can together promote sustainable businesses practices throughout Latin America and the Caribbean.”
About the eco.business Fund
The eco.business Fund aims to promote business and consumption practices that contribute to biodiversity conservation, to the sustainable use of natural resources, and to mitigate climate change and adapt to its impacts. By providing financing for business practices that conserve nature and foster biodiversity, the fund seeks investments with both environmental and financial returns. The fund mainly provides loans to qualified financial institutions that on-lend the money to eligible borrowers, which include holders of recognized certifications or those making improvements in line with conservation and biodiversity goals. The fund supports sustainable operations in the sectors of agriculture, fishery (including aquaculture), forestry and tourism.
The eco.business Fund was initiated by Germany’s KfW Development Bank and Conservation International with financial support from the German Federal Ministry for Economic Cooperation and Development (BMZ). It has received further donor support from the European Commission. The fund’s additional investor base comprises the U.K. government’s Department for Environment, Food and Rural Affairs, Dutch development bank FMO, Austrian development bank OeEB, and institutional investors such as sustainable banking institution ASN Bank, German ethical bank GLS Bank, Calvert Impact Capital, and Raiffeisen Bank International. Finance in Motion, a leading impact investing company, is also an investor.
Operating hand-in-hand with the eco.business Fund, the eco.business Development Facility provides high-impact technical assistance to financial institutions and final borrowers.