Absa case study: Partnerships bank quick wins for the sustainability fight
More than 100 temperature records have been broken this year, pointing to the intensifying frequency of extremely hot temperatures globally. Experts, including climate historian Maximiliano Herrera, are attributing these extremes to several man-made actions such as the continued use of fossil fuels as well as the end of the El Niño weather pattern.
Millions of people in Kenya and Africa continue to bear the brunt. Major institutions such as the United Nations (UN) and the Copernicus Climate Change Service have intensified warnings on the negative impacts of climate change, including severe droughts, floods, and rising sea levels in some countries.
With the challenges we face as a generation moving faster than our ability to implement effective countermeasures, the call for solidarity among stakeholders has never been more urgent.
For Absa Bank Kenya, advancing the country’s sustainability agenda is a goal anchored on building mutually beneficial partnerships. In 2023, the Pan-African lender entered into a partnership agreement with the Kenya Forest Service to roll out a nationwide tree-planting initiative.
This greening project aims to tap the power of trees in mitigating extreme weather events. Studies show that trees play a vital role in the carbon cycle. Trees are carbon sinks. They absorb the rising carbon dioxide (CO2) emissions from the atmosphere through photosynthesis and store it in their trunks and roots.
Kenya’s declining forest cover
Absa’s 2023 Sustainability Report shows that the lender entered into partnerships with community forest associations, including women, youth, and persons living with disabilities to improve Kenya’s declining forest cover.
With the support of partners, Absa planted over 700,000 trees last year and seeks to nurture them to maturity. What’s more, the lender is introducing mapping for the planted trees as it readies its network of partners to tap billions in the nascent carbon offset market.
According to Absa Bank Kenya CEO Abdi Mohamed, the institution projects to plant 10 million trees by 2032. “In line with the government’s goal of planting 15 billion trees by 2032, we have already planted 10,000 trees at Njukini Forest in Embu County.”
Additionally, the report shows rehabilitation works targeting a degraded 100-hectare zone in Sorget Forest in Kericho County started last year even as Absa offered 10,000 tree seedlings as part of a bold plan to rehabilitate Kinale Forest, in Kiambu County.
Absa’s undertaking under partnerships stretched to Kiu Wetlands in Makueni County, where it donated 20,000 bamboo seedlings to a government-led initiative to conserve this vital water catchment area.
What’s more, Absa—which projects to achieve net zero status by 2050—is championing partnerships across the corporate space, bringing on board several organizations with a shared vision of driving a sustainable economy.
For instance, the bank is collaborating with Athletics Kenya, telco giant Safaricom PLC as well as the Stockholm Environment Institute to plant over 2,500 trees at Kasarani International Stadium in Nairobi County.
Read also: Absa more than doubles its supplier diversity to 16pc
Role of partnerships in creating change
By offering leadership and bringing stakeholders together, Absa is increasingly underscoring the essential role of partnerships in powering Kenya and the region’s sustainable future.
“Absa is one of our key partners in various commercial elements, but the partnership that excites us most is what we have in sustainability. The bank is part of the partners that helped us acquire our first Environmental, Social, and Governance (ESG)-linked loan last year [2023],” said Safaricom CEO Peter Ndegwa.
Ndegwa further acknowledged that the key to fruitful climate action on sustainability pivots on collaboration and partnerships among stakeholders.
“We achieved this success due to the like-minded collaboration by partners, who share similar values of running sustainable businesses,” Ndegwa added.
Globally, the corporate world is experiencing increasing demand for sustainable business practices. And Absa Bank is aligning its products and services offerings accordingly.
Our mission is to help stakeholders navigate challenges and embrace growth opportunities… We support small and medium-sized enterprises (SMEs) by monitoring their evolving needs, Mohamed noted.
In 2023, Absa Bank’s See Her Empowered (SHE) Star Programme empowered over 35,000 women in business as part of the lender’s mission to drive financial inclusion. With a backing of KES10 billion, the bank’s Women in Business initiative seeks to significantly enhance credit access for SMEs owned by women by next year.
Opportunities for collaboration
In 2023, Absa disbursed KES6.7 billion in green building projects in partnership with Acorn Holdings Ltd for the set-up of 10 purpose-built student accommodations.
According to a 2019 report by the International Finance Corporation (IFC), green buildings present a low-carbon investment opportunity with the potential to hit $2.7 trillion globally by 2030 across the developing economies.
Furthermore, the lender’s partnerships in climate finance saw a total of KES2.2 billion channelled towards climate-smart agriculture in a deal with Eco-business fund, which is a global entity that promotes green financing in agriculture, agri-processing, fishery and aquaculture, and forestry among other sectors.
However, the scope for collaboration and partnerships remains broad and more institutions can plug into this broad ecosystem that is driving Kenya’s sustainability agenda.
Speaking during a panel session at the launch of Absa’s 2023 Sustainability Report, East African Breweries Ltd (EABL) Corporate Relations Director Eric Kiniti called for more collaborations in sustainability research and innovation.
“We don’t have enough data on what the private sector is undertaking on advancing sustainability and climate change mitigation efforts,” Kiniti said, challenging academic and research organizations in the country to collaborate more with the industry in achieving a sustainable economy.
In conclusion, it is increasingly clear that collaborations can play an even bigger role in driving Kenya’s sustainability agenda. As the call for sustainable business practices and accountability gains prominence globally, Absa Bank Kenya says it is doubling down on engagement with partners such as UN Global Compact, and companies like solar systems provider Sun King, SMEs, farmers, and community groups, leveraging on shared strengths to deliver projects at scale.
Absa Bank Kenya Board Chairman captures this vision succinctly: “Our stakeholders — whether they are investors, regulators, or customers — expect more from us. They want to see the bigger picture, understanding not only how we create value for our shareholders, but also the broader impact we have on society and the environment.”
