SBFN Member Since:
2016
Member Organisations
Banking Association South Africa (BASA)
South Africa Prudential Authority (operates within the administration of the South African Reserve Bank)
South African National Treasury
Progress Against Pillars and Sub Pillars
This graphic can also be found within this country’s 2019 Country Progress Report.
Framework Documents
| Country | Policies/ Principles/ Guidelines | Year | Issuer |
|---|---|---|---|
| South Africa | 2022 | South Africa National Treasury | |
| South Africa | 2020 | Johannesburg Stock Exchange (JSE) | |
| South Africa | 2020 | South Africa National Treasury | |
| South Africa | 2019 | Financial Sector Conduct Authority – FSCA | |
| South Africa | 2020 | South African Reserve Bank | |
| South Africa | Primer on Embedding Environmental Scenario Analysis into Routine Financial Decision Making | 2018 | South Africa National Treasury |
| South Africa | 2017 | Johannesburg Securities Exchange (JSE) | |
| South Africa | 2016 | Institute of Directors in Southern Africa – IoDSA | |
| South Africa | 2015 | Banking Association South Africa |
Strategic Development - Alignment with global E&S standards and best market practices
S1.1 – Does the framework make reference to international E&S targets (SDGs, Paris Agreement, Global Compact)?
No
–
–
–
S1.2 – Does the framework make reference to established international E&S risk management standards (IFC PSs, EPs)?
No
–
–
–
S1.3 – Does the framework make reference to established international sustainability reporting standards (GRI, SASB)?
No
–
–
–
S1.4 – Does the framework make reference to established international climate finance reporting standards (TCFD)?
No
–
–
–
S1.5 – Does the framework ask to make E&S policies, practices and results externally verified (assurance, independent review)?
No
–
–
–
Strategic Development - Multi-stakeholder collaboration
S2.1 – Does the framework involve interagency collaboration between financial supervisors/regulators, industry association, and FIs?
Yes
S2.2 – Does this collaboration also include other public agencies (e.g., environmental agencies, ministries)?
Yes
(1) – 3.2
” Members can contribute through appropriate collaboration with Government and other stakeholders in addressing environmental and social issues such as climate change, water”
Principles for managing Environmental and Social risks (BASA, 2015)
S2.3 – Does this collaboration also include representatives of civil society (e.g., NGOs, associations, media)?
–
–
–
Strategic Development - Alignment to NDCs and with National or Regional Climate Change Targets
S3.1 – Is the framework aligned with national NDCs or other national and regional policies on climate?
No
–
–
–
S3.2 – Has the SBN member identified the main climate risks (transition/physical) for their local financial sector?
Yes
(5)
–
Guidance Notice: Sustainability of investments and assets in the context of a retirement fund’s investment policy statement (FSCA, 2019)
ESG Integration - Governance of E&S
Role of Governing Bodies on E & S
E1.1 – Does the country policy require one of the FI’s governing bodies (e.g., Board of Directors, Executive Committee, Supervisory Board, etc.) to approve an E&S strategy?
Yes
(4) Principle 3 – 14.d
–
South Africa King IV Code On Corporate Governance (IoDSA, 2016)
E1.2 – Does the policy require management to report on E&S strategy implementation to the governing bodies?
Yes
(4) Principle 8 – 43.e & Principle 10 -78, 97
–
South Africa King IV Code On Corporate Governance (IoDSA, 2016)
E1.3 – Does the policy require FI operational bodies to report to the governing bodies (or specific Board committee) on implementation of the E&S strategy?
No
–
–
–
Organization
E1.4 – Does the framework ask FIs to define E&S roles and responsibilities?
Yes
(4) Principle 8 -39
Only asked to define a governance
South Africa King IV Code On Corporate Governance (IoDSA, 2016)
E1.5 – Does the framework highlight the E&S roles of front office staff and second lines of defense (e.g. risk officers and/or compliance officers)?
No
–
–
–
E1.6 – Does the framework ask FIs to define E&S competencies for each role?
No
–
–
–
E&S Risk Management
E&S Policy
E2.1 – Does the framework ask FIs to formalize an E&S or ESG policy?
Yes
(4) Principle 13 – 25 & Principle 14 – 29.b
The Code for Responsible Investing has not be considered as part of the framework.
South Africa King IV Code On Corporate Governance (IoDSA, 2016)
E2.2 – Does the framework encourage FIs to go beyond E&S requirements of local laws and regulations?
Yes
(1) – 4.1.2
–
Principles for managing Environmental and Social risks (BASA, 2015)
E2.3 – Does the framework ask FIs to set E&S objectives and targets?
Yes
(4) Principle 3 – 14.d
–
South Africa King IV Code On Corporate Governance (IoDSA, 2016)
E2.4 -Does the framework ask FIs to publicly disclose their E&S policy and its governance?
Yes
(4) Principle 3 – 34.h
The Code for Responsible Investing has not be considered as part of the framework.
” at least once a year, fully and publicly disclose to what extent it applies to CRISA.”
South Africa King IV Code On Corporate Governance (IoDSA, 2016)
Risk Assessment
E2.5 – Does the framework require FIs to carry out appropriate E&S due diligence at transaction level?
Yes
(1) – 4.2.2 & 4.2.4
–
Principles for managing Environmental and Social risks (BASA, 2015)
E2.6 – Does the framework require FIs to carry out appropriate E&S due diligence at client level?
Yes
(1) – 4.2.1, 4.2.2 & 4.2.3
–
Principles for managing Environmental and Social risks (BASA, 2015)
E2.7 – Does the framework encourage FIs to categorize projects/clients according to their level of E&S risk?
Yes
(1) – 4.2.1, 4.2.2 & 4.2.3
–
Principles for managing Environmental and Social risks (BASA, 2015)
E2.8 – For high-risk transactions, does the framework encourage site visits to be organized?
No
–
–
–
E2.9 – In case of negative E&S impacts, does the framework invite FIs to engage with clients to implement mitigation measures?
No
–
–
–
E&S Covenants
E2.10 – Does the framework ask FIs to incorporate E&S covenants and investment conditions into legal agreements with clients?
No
–
–
–
Project Supervision & Portfolio Review
E2.11 – Does the framework ask FIs to develop processes to manage E&S risks during supervision?
Yes
(1) – 4.2.4
“Furthermore, members will develop and implement systems and procedures which identify, measure, and monitor environmental and social risks during the life
cycle of project finance agreements and require clients to do the same, subject to legal and regulatory requirements.”
Principles for managing Environmental and Social risks (BASA, 2015)
E2.12 – Does the framework encourage a periodic review of E&S risks at aggregate portfolio level?
No
–
–
–
Training
E2.13 – Does the framework ask FIs to develop and maintain E&S capacity through regular training?
Yes
(1) – 3.5
–
Principles for managing Environmental and Social risks (BASA, 2015)
E2.14 – Does the framework highlight the training of (i) front office staff, (ii) second lines of defense (risk officers and/or compliance officers), and (iii) E&S experts?
No
–
–
–
External Communication Mechanism
E2.15 – Does the policy require FIs to establish and maintain an inquiry/complaints/grievance mechanism in relation to E&S or ESG practices?
No
–
–
–
E & S Reporting
E2.16 – Does the policy require FIs to report regularly on E&S or ESG performance, including publicly, to investors or to regulators?
Yes
(4) page 41 “Disclosure on Application of King IV”
Answer was “Yes” in the first report, however I do not find clear evidence.
“Increase transparency and consistency in the application of environmental and social risk management practices in members own operations, lending practices, investment practices, products and services provided.”
South Africa King IV Code On Corporate Governance (IoDSA, 2016)
E2.17 – Does the policy make E&S or ESG reporting and disclosure more consistent across financial institutions through principles, guidelines, or templates?
No
–
–
–
E & S Integration - Enforcement
E3.1 – Is the implementation of the framework regularly verified or is information regularly collected from FIs?
No
–
–
–
E3.2 – Is there any financial and/or non-financial incentive for establishing ESRM systems?
No
–
E3.3 – Are there sanctions/penalties/warnings in case of noncompliance with the framework?
No
–
–
–
Climate and Green Finance - Products and Services
Defining sustainable assets and financial products
C1.1 – Does the framework provide definitions and examples of green assets?
Yes
(2) – Introduction page 6 & 7 and from 11
–
South Africa Green Economy Accord (EDD, 2011)
C1.2 – Does the framework provide a comprehensive taxonomy of green assets?
No
–
–
–
C1.3 – Does the framework provide definitions, examples, or a taxonomy of social and/or sustainable assets?
No
–
–
–
C1.4 – Besides debt products (loans, bonds), does the framework provide definitions and examples of different types of sustainable finance products/services (e.g., saving accounts, means of payment, insurance, private equity, etc.)?
No
–
–
–
Green Finance Product Guidelines
C1.5 – Does the framework provide guidelines for green loan/green credit or other green financial assets (excluding green bonds)?
No
–
–
–
C1.6 – Does the framework provide guidelines for issuance of green bonds?
Yes
(3) – Green Segment 6.10 (p49)
–
South Africa Debt Listings Requirements for the Green Segment (JSE, 2017)
C1.7 – Does the framework refer to existing standards (e.g., ICMA’s Green Bond Principles or CBI’s Climate Bonds Standard)?
Yes
(3) – Green Segment 6.10 (p49)
–
South Africa Debt Listings Requirements for the Green Segment (JSE, 2017)
C1.8 – Does the framework recommend external party verification (e.g., second party opinion, assurance, certification)?
Yes
(3) – Green Segment 6.12 (p50)
–
South Africa Debt Listings Requirements for the Green Segment (JSE, 2017)
Climate and Green Finance - Climate and Green Investment Reporting
Tracking and Disclosure of Climate & Green Finance
C2.1 – Does the framework ask FIs to report on climate/green finance flows (quantitatively or qualitatively)?
Yes
(3) – Green Segment 6.12 (p50)
–
South Africa Debt Listings Requirements for the Green Segment (JSE, 2017)
C2.2 – Does the framework ask FIs to report on climate risk exposure at portfolio level?
No
–
–
–
C2.3 – Does the framework encourage FIs to report publicly on their green finance activities (i.e. not only to the regulator)?
Yes
(3) – Green Segment 6.12 (p50)
–
South Africa Debt Listings Requirements for the Green Segment (JSE, 2017)
Climate and Green Finance - Measurement
Calculation of Environmental Benefits
C3.1 – Does the framework ask FIs to calculate the environmental benefits of their investments? (e.g., CO2 emission reduction, water saving, etc.)
No
–
–
–
C3.2 – Does the framework provide a taxonomy of potential environmental impacts?
No
–
–
–
C3.3 – Does the framework provide methodologies, tools, and/or templates to measure and report these impacts?
No
–
–
–
Climate Risk Exposure Assessment
C3.4 – Does the framework ask FIs to monitor climate risk exposure at portfolio level?
No
–
–
–
C3.5 – Does the framework refer to specific climate risk exposure methodologies (e.g., climate scenario analysis, climate risk stress testing, calculation of carbon risk exposure, tracking of energy efficiency for real estate portfolio)?
No
–
–
–
C3.6 – Does the framework encourage FIs to take mitigating steps on these risks?
No
–
–
–
Climate and Green Finance - Incentives
Financial and Non-Financial Incentives
C4.1 – Does the framework provide any type of incentives for green financial products and services?
No
–
–
–
C4.2 – More specifically, does the framework introduce financial incentives on green products and services?
No
–
–
–
