Ecuador’s Financial Sector Aligns with International Goals for Sustainable Finance

QUITO, ECUADOR - Ecuador’s financial sector has made significant strides in promoting sustainable finance, aligning with international goals and standards.

A Collaborative Effort

The country’s Sustainable Banking Protocol involves a collaborative effort between financial supervisors, regulators, industry associations, and financial institutions (FIs). In 2020, Ecuador launched the Sustainable Finance Initiative, a public-private-academic collaboration led by the Central Bank of Ecuador (BCE) to promote sustainable finance in Ecuador, consistent with international standards and best practices.

The Guide for Green and Social Bonds for Ecuador, issued by the Quito Stock Exchange in 2020, provides guidance on issuing green bonds and sustainability-linked loans. The guide aims to support climate-friendly investments and social initiatives.

Addressing ESG Risks

Ecuador’s financial sector is also addressing environmental, social, and governance (ESG) risks through:

ESG integration
Climate risk management
Financing sustainability initiatives

These efforts are expected to unlock capital flows for activities that support climate, green economy, and social goals.

Expert Opinion

“The Ecuadorian financial sector’s commitment to sustainable finance is a testament to the country’s dedication to promoting environmentally friendly and socially responsible practices,” said [Name], an expert in sustainable finance.

Assessment and Progress

The country’s progress in sustainable finance was assessed using the Sustainable Banking Framework (SBF), a tool developed by the Sustainable Banking Forum. The SBF assesses regulatory guidance, supervision strategies, disclosure requirements, and voluntary industry approaches across three pillars:

ESG Integration
Climate Risk Management
Financing Sustainability

Ecuador’s financial sector has made significant progress in developing and implementing national policies and principles for sustainable finance, with industry uptake and practices also showing improvement.

The Sustainable Banking Forum

The Sustainable Banking Forum (SBF) is a global initiative that aims to promote sustainable banking practices worldwide. The SBF provides a framework for banks to integrate environmental, social, and governance considerations into their business strategies, risk management, and reporting practices.