UBA inks deal

United Bank for Africa (UBA) has matched its commitment to conservation and sustainability by moving to combat the effects of climate change on small- and medium-sized enterprises (SMEs).

The pan-African lender, which had a balance sheet of $23.6 billion as at December 31, 2022, has partnered with Signature Medal of Change, to finance more climate friendly projects and sustainable practices.

Expounding on UBA’s determination to cut carbon emissions to “zero”, Ms Mary Mulili, the UBA Kenya CEO told a gathering in Nairobi that carbon offset, which broadly refers to a reduction in greenhouse gas emissions, or an increase in carbon storage, especially through land restoration or planting of trees, would help mitigate risks associated with climate change while also preserving the environment.

 “We take conservation and sustainability seriously,” Ms Mulili said. “Carbon credit is a new area, but are eligible entities being compensated? How do we get to a point where people get compensated for carbon credit? So we recognise the importance of conservation, which also involves buying and trading in carbon credit.” The bank’s commitment comes just three months after President William Ruto assented to key provisions of the Climate Change (Amendment) Act as the country moves to regulate buying and trading of carbon credit.

On his part, Signature Medal of Change’s interim chief executive and founder, John Brian Oyaro said: “By advancing perspectives on the Kenyan Climate change Act of 2023, communities and businesses can capitalise on benefit-sharing mechanisms within carbon markets.”

Ms Madikizela Otieno, a lawyer at Oraro and Company Advocates, told the Nairobi Business Monthly that Kenya is now one of the few countries with dedicated legislation on climate change after passing the Climate Change Act 2016 to provide a benchmark for a low carbon transition, with the overall goal being to mainstream climate change into development planning, decision making and policy implementation.

“Carbon credit allows parties that emit these gases to buy them from someone else who is reducing. It’s like ‘I am cancelling out’, that is why it is called net zero,” Ms Otieno said.

The new law represents a significant stride in Kenya’s efforts to mitigate climate change impacts and develop a robust carbon market. However, according to Ms Otieno, there are gaps and shortcomings in the Act that may
require further refinement or clarification.