Banks must ensure that environmental and social risks associated with projects financed by banks are well managed, Dr Ernest Addison, Governor of the Bank of Ghana (BoG), has said.

Speaking during the launch of the country’s Sustainable Banking Principles and Sector Guidance Notes in Accra on Wednesday, November 27, it is only responsible on the part of banks to ensure that the environment is not damaged by the activities and projects they finance.

He said: “distinguished ladies and gentlemen, responsible banking practices will have to ensure that environmental and social risks associated with projects financed by banks are well managed."

“For banks to remain sustainable over the long-term, it is important that their own internal operations and financing activities meet the present needs of economic agents today, while not compromising the ability of future generations to meet their own needs.

“The Bank of Ghana therefore recognises environmental and social risk management (ESRM) as key components of banks‘ overall risk management strategy.

“We are not alone in this regard. Central Banks and banking regulators around the world have mainstreamed ESRM in their prudential risk assessments, given the potential impacts of environmental and social factors on the long-term safety and soundness of banks.”