Green Economy Journal Issue 39

ECONOMY
Rising adoption of
sustainable finance
will boost South Africa’s green economy
BY NIGEL BECK, HEAD OF SUSTAINABLE FINANCE AND RENTIA VAN TONDER,
HEAD OF POWER FOR STANDARD BANK
South African companies are showing unprecedented interest in sustainable finance
solutions – a trend that will give further impetus to the country’s green economy.
Globally, sustainable debt issuances surged 60% to a record high
of US$415bn in 2019, according to Bloomberg data. While green
bonds still account for more than half of all issuances, green
loans and sustainability loans are starting to gain traction.
For the time being, South Africa is behind the curve when it comes to
the adoption of sustainable finance. But we are seeing a sharp increase in
interest from corporate clients, who are considering new opportunities to
initiate and implement renewable energy projects, ensure their buildings
are ‘green’, and to launch water- and energy-efficiency initiatives.
Opportunities abound in every sector. A 2019 study by advisory firm
Consulting for Sustainable Solutions found that in the property sector,
there is much-untapped potential for sustainable finance. In the residential
segment, R216bn worth of property in South Africa currently meets the
Climate Bonds Initiative’s requirements for certification, while R4.7bn
worth of commercial property meets those requirements.
However, as per the green-building principles, more than R100bn worth
of commercial property could qualify as green buildings. There are already
more than 500 certified green buildings in South Africa, according to the
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