Republic Financial Holdings Limited’s Commitment to Climate Change Mitigation and Adaptation

Republic Financial Holdings Limited (RFHL) will join the rest of the world in commemorating Earth Day on April 22nd. The theme for 2022 - “Invest in Our Planet” is significant for RFHL, as the Group has formalized its strategic stance to mainstream sustainability throughout its internal and external operations, by adopting ESG (Environmental, Social and Governance) as the new way of doing business. Under the ESG umbrella, RFHL is also a founding signatory to the United Nations Environment Programme’s Finance Initiative’s (UNEPFI) Principles of Responsible Banking (PRB) and Net Zero Banking Alliance (NZBA). NZBA will have a direct impact on the bank’s scope of influence surrounding climate change issues.

Climate Change is perhaps THE defining issue of the 21st Century and the planet is at a critical juncture in time. Covid 19 demonstrated to the world just how susceptible we are to global events and we must follow the science regarding Climate Change projections to prevent the fallout from shutdowns, over-burdened health and social systems and ill-preparedness. The latest reports (2021) from the Intergovernmental Panel on Climate Change (IPCC) show significant changes in the Earth’s climate in every geographic region and across the whole climate system. The report stresses the following areas of concern:

• From 1880 to present, average global temperature has increased by almost 1 degree Celsius.
• From 1901, to present, sea levels rose on average 20cm, with Artic sea ice shrinking in every decade since 1979 at a rate of 1.07km² x 106km² per decade.
• If unchecked, by 2065 average sea level rise is predicted to be about 24-30cm.

While, these figures may appear small, the Earth’s processes are extremely sensitive to even the most miniscule variances and leaving climate change unchecked, will be catastrophic to almost every aspect of life as we know it.

Small island states, such as the Caribbean countries, are the most vulnerable to Climate Change, even though their contribution to global greenhouse gas emissions is small. Apart from the obvious geographic conditions of being small and surrounded by rising oceans, our economies are inextricably tied to environmental changes – from tourism to agriculture. Once our livelihoods are threatened, access to social and health services are also compromised. Most of the countries in the region in 2020 recorded warmer than average temperatures, according to the World Meteorological Organization (WMO). In addition, in Dominica, Grenada, Puerto Rico, Aruba, Saint Lucia, and specific locations in Martinique, multiple monthly heat records were broken.

The region also saw below-average rainfall in the early months of 2020, resulting in extensive drought conditions, although the drought-like conditions were short-lived thanks to an active rainy season and an abundance of tropical waves. Sea levels in the Caribbean have been rising at a slightly faster rate than the global average (3.3 mm/year) between 1993 and 2020, with the Caribbean sea surface temperature reaching a high of +0.87°C above the 1981-2010 normal in 2020, exceeding the previous high of + 0.78°C in 2010. Perhaps one of the more terrifying examples of climate change was when the region was devastated by two back to back Category 5 hurricanes in 2017. Warmer, more dynamic oceans create the perfect conditions for the increased frequency and intensity of storm events.

However, as much as the region is impacted by changes in climate, it is also perfect for solutions. Most countries have optimum conditions for renewable energy options such as solar, wind and hydro. Access to education and learning opportunities are high, lending to potential innovation in research, technology development and monitoring and evaluation. There are numerous avenues for change, but the region must work together to facilitate it – and the financial sector has perhaps the most crucial role.

Earth Day’s 2022 theme of “Invest in Our Plant” removes the esoteric connotation often associated with Climate Change and challenges a call to action among those who are poised to lead for change – the financial sector and its various stakeholders.

RFHL took a leadership role in this regard long before Earth Day’s call.

RFHL’s commitment:
We are taking deliberate initiatives at RFHL to become leaders in the Caribbean. We are working to develop a Sustainable Finance Sector as a member of the UNEPFI, and we are committed to incorporating environmental and social issues into our business. On September 25th, 2020, we signed the Global Principles for Responsible Banking and joined the Net-Zero Banking Alliance as a Founding Member.

This is in line with our firm commitment to achieving net-zero greenhouse gas emissions in our financing activities by 2050. Our objective is to create ethical and creative bank product offerings to satisfy the demands of the Caribbean, as well as to discover areas of positive impact that connect with the United Nations Sustainable Development Goals (the SDGs). We want to increase accountability and transparency so that our company can be a better corporate citizen in the Caribbean and Ghana.

The Group has pledged itself, more than ever, as a committed partner towards the following Climate Finance goals:
By 2025, finance, invest, and arrange $200 million to help mitigate the effects of climate change and construct climate-resilient infrastructure throughout all territories. Our pledge is to provide this much-needed access to funds to:
1. Make electric vehicles more accessible, and begin replacing our own fleet of vehicles with electric vehicles as part of our entire benefit package in 2030.
2. Support the development of renewable energy and related technologies, as well as the transition away from fossil fuels and toward more environmentally friendly energy sources.
3. Provide loans that contribute to energy efficiency and fund construction projects that deploy climate-resilient technology.
4. Support initiatives and projects that support environmental sustainability, renewable energy projects, green initiatives, and the blue economy, in a socially minded and just manner.
5. Build all of our new properties in accordance with LEED Certified Standards by 2025, and to make our existing properties become more environmentally friendly and energy efficient.

Climate action requires significant financial investments, but climate inaction will be disastrous. Our solutions must deliver economic benefits while improving our lives and protecting the environment. The Group is excited about the numerous opportunities to invest in climate-focused initiatives and collaborate with our partners to help create more sustainable communities.