CFO Raisibe Morathi: Nedbank plans to ensure a low-emission and climate-resilient future

Nedbank shareholders have unanimously approved two climate change-related resolutions.

The Nedbank Group has become the first South African company to have climate-related resolutions it tabled itself passed by its shareholders. 

“I am really encouraged that our shareholders have unanimously approved the two climate-change-related resolutions we proactively put to the vote at our 53rd Annual General Meeting in May 2020,” says Nedbank CFO Raisibe Morathi. “Such approvals demonstrate a fair alignment between us and our shareholder base.” 

The shareholders voted on adopting a sustainable energy policy and on disclosing fossil-fuel linked lending, including to oil and gas projects. 

Raisibe says the resolution represents a significant step in the right direction, although Nedbank is mindful that there is a long journey ahead with much learning to do. 

“Through the two ordinary resolutions, we are committed to adopting and publicly disclosing an energy policy aimed at enabling the transformation of the energy system over time by making finance flows consistent with a low-emission and climate-resilient future,” Raisibe adds. “We will also report on our approach to measuring, disclosing and assessing financial exposure to climate-related risks, including exposure to oil- and gas-related activities as a percentage of total advances by April 2021.” 

This, she says, will inform shareholder and other stakeholders of the group’s journey in assessing its lending activities, investment practices and operations in relation to climate-related risks and opportunities over time as standards, guidelines and principles on climate risk mature, including appropriate alignment to global best practices. 

“The unanimous approval of both climate-change-related resolutions builds on our leadership position in renewable energy financing, our operations being carbon-neutral since 2010, Nedbank becoming the first commercial bank to launch a green bond on the JSE in 2019 and signing up to be part of the UNEP FI Task Force for Climate-related Financial Disclosures working group last year, which will enable us to learn from others in the sector as well as participate in the development of tools to assess the physical and transitional risk that climate change poses for banks,” Raisibe says.

She adds that Nedbank is also highly regarded for its broader ESG practices and disclosures, the proactive nature of engaging on ESG matters and for always considering stakeholder inputs. 

The company held its seventh annual governance roadshow in early May to engage with shareholders on ESG and strategic matters. Climate change and its climate-change-related shareholder resolutions were key topics of discussion ahead of the 53rd AGM.

In addition, during the year, Nedbank consulted various stakeholders and thought leaders who provided valuable inputs into its ongoing climate change journey and will continue to engage with Its stakeholders to ensure continued use of “our financial expertise to do good” and impact the environment positively through appropriate financial choices.

From a governance perspective, the Nedbank board and sub-committees oversee climate change risks and opportunities. The bank has established a new Climate Risk Leadership Group (CRLG) which guides Nedbank with regard to measuring, assessing and disclosing its financial exposure to climate-related risks.

“Over and above my role on the board and the executive committee, as CFO, through my portfolio I focus on ensuring world-class disclosure and reporting, as well as excellent relationships with our shareholders,” she concluded. 

This follows South African banks receiving increasing pressure to limit their lending to fossil fuel projects and disclose their climate risk.