Sustainable Finance – the business case

Understanding DFIs

  • Target group:
  • Estimated duration: 1 hour 40 minutes
  • Cost: €0

Course Overview

Beyond “tree hugging”: Putting figures to environmental and social risks and thereby “proving the business case”


For many, green or social banking is still a subject for “tree huggers”. While this may be true to a large extent, there are by now many excellent examples for “proving the business case”. This is true for direct risks and opportunities faced by the financial institutions (saving money or reputation) as well as for indirect risks (i.e. Eamp;S risks and opportunities at the credit taker level).

To prove the business case, the present course attempts to put a price tag to all thinkable environmental and social risks, in US $. This includes rough estimation of costs related to potential clean ups, accidents, environmental penalties, business delay, insurances, reduced staff motivation, conflicts with neighbouring communities, reputational risks, to name a few. Further, we quantify to the extent possible, environmental and social opportunities, again in US $.

Only by fully understanding the costs and benefits related to their client’s environmental and social performance, banks will take the issue of managing Eamp;S risks and opportunities in their portfolios actively and start developing new banking products.