AlitheaBELT & ROAD, or how China Plans to Conquer the world - economically!
The City of London Corporation is helping to bring together some of the world’s biggest banks in Beijing to discuss for the first time implementation of Green Investment Principles (GIPs) for the Belt and Road, announced in London in November last year.
The Belt and Road Initiative (BRI, or B&R), formerly known as One Belt One Road (Chinese: 一带一路) or OBOR for short, is a global infrastructure development strategy adopted by the Chinese government in 2013 to invest in nearly 70 countries and international organisations.
It is considered a centrepiece of the Chinese leader Xi Jinping's foreign policy. The BRI forms a central component of Xi's "Major Country Diplomacy" (Chinese: 大国外交) strategy, which calls for China to assume a greater leadership role for global affairs in accordance with its rising power and status.
The Bank of China, Standard Chartered, HSBC, China Development Bank and more than twenty other banks and financial institutions (*full list below) are among the signatories and will be among those attending the meeting, which will see all signatories and supporters share knowledge on green investment and best practices.
The GIPs were launched at the Belt and Road Forum in April, with the overall aim of factoring environmental risk and climate resilience into infrastructure projects.
They were welcomed by the UK and Chinese governments in the policy outcome paper at the 10th UK-China Economic and Financial Dialogue.
This came as a result of work delivered by the UK-China Green Finance Centre, supported by the Green Finance Institute and China’s Green Finance Committee.
Sir Roger Gifford, Chair of the Green Finance Institute and Co-Chair of the UK-China Green Finance Centre, said:
“I am excited to be attending the first plenary meeting of the Green Investment Principles, the first of their kind and a potential game-changer in mitigating the potential environmental impact of the Belt and Road Initiative.
“With the collaboration of our Chinese partners through the UK-China Green Finance Centre, we are playing a fundamental role in ensuring that one of the biggest infrastructure projects in history incorporates low-carbon and sustainable development.
“I am confident that this first meeting will together put us firmly on the path toward achieving that key objective.”
The City of London Corporation is the governing body of the Square Mile dedicated to a vibrant and thriving City, supporting a diverse and sustainable London within a globally-successful UK. www.cityoflondon.gov.uk
LIST OF SIGNATORIES
Agricultural Bank of China
Agricultural Development Bank of China
Al Hilal Bank
Ant Financial Services Group
Astana International Exchange
Bank of China
Bank of East Asia
BMCE Bank of Africa
China Construction Bank
China Development Bank
China International Capital Corporation
China International Contractors Association
Credit Agricole-CIB
DBS Bank
Deutsche Bank
Export-Import Bank of China
First Abu Dhabi Bank
Habib Bank
Hong Kong Exchanges and Clearing Limited
HSBC
Khan Bank
Industrial and Commercial Bank of China
Industrial Bank
Luxemburg Stock Exchange
Mizuho Bank
Natixis Bank
Silk Road Fund
Standard Chartered Bank
Trade & Development Bank of Mongolia
UBS
GREEN INVESTMENT PRINCIPLES FOR THE BELT AND ROAD
Principle 1: Embedding sustainability into corporate governance
We will embed sustainability into our corporate strategy and organisational culture. Our boards and senior management will exercise oversight of sustainability-related risks and opportunities, set up robust systems, designate competent personnel, and maintain acute awareness of potential impacts of our investments and operations on climate, environment and society in the B&R region.
Principle 2: Understanding Environmental, Social and Governance Risks
We will strive to better understand the environmental laws, regulations, and standards of the business sectors in which we operate as well as the cultural and social norms of our host countries. We will incorporate environmental, social and governance (ESG) risk factors into our decision making processes, conduct in-depth environmental and social due diligence, and develop risk mitigation and management plans, with the help of independent third-party service providers, when appropriate.
Principle 3: Disclosing environmental information
We will conduct analysis of the environmental impact of our investments and operations, which should cover energy consumption, greenhouse gas (GHG) emissions, pollutants discharge, water use and deforestation, and explore ways to conduct environmental stress test of investment decisions. We will continually improve our environmental/ climate information disclosure and do our best to practice the recommendations of the Task Force on climate-related Financial Disclosure.
Principle 4: Enhancing communication with stakeholders
We will institute stakeholder information sharing mechanism to improve communication with stakeholders, such as government departments, environmental protection organizations, the media, affected communities and civil society organizations, and set up conflict resolution mechanism to resolve disputes with communities, suppliers and clients in a timely and appropriate manner.
Principle 5: Utilizing green financial instruments
We will more actively utilize green financial instruments, such as green bonds, green asset backed securities (ABS), Yield Co, emission rights based financing, and green investment funds, in financing green projects. We will also actively explore the utilisation of green insurance, such as environmental liability insurance and catastrophe insurance, to mitigate environmental risks in our operations.
Principle 6: Adopting green supply chain management
We will integrate ESG factors into supply chain management and utilize international best practices such as life cycle accounting on GHG emissions and water use, supplier whitelists, performance indices, information disclosure and data sharing, in our investment, procurement and operations.
Principle 7: Building capacity through collective action
We will allocate funds and designate personnel to proactively work with multilateral organizations, research institutions, and think tanks to develop our organizational capacity in policy implementation, system design, instruments development and other areas covered in these principles.
Brief history of Belt & Road planning sessions
2019
Global banks meet in China for first Green Investment Principles plenary meeting
Green Belt and Road principles receive industry backing
2018
City of London Corporation works with China to green the Belt and Road Initiative
City Corporation puts London on the Belt and Road map
Lord Mayor Charles Bowman speech at the CCCUK China-UK Economic and Trade Cooperation event
London and Hong Kong boost cooperation in Belt and Road
Green Finance report says sector is ready to scale up