#2
KCB
KCB Group, recognised as East Africa’s largest bank by asset base, has established itself as a pioneering force in the region by seamlessly integrating Environmental, Social, and Governance (ESG) principles into its core business growth strategy. The bank’s commitment to Sustainability and ESG is not just a corporate responsibility; it is central to the Brand’s Purpose: “For People. For Better.”
The bank’s statement of intent is anchored around 14 Sustainable Development Goals (SDGs), which it has actively tackled for decades, demonstrating a meaningful impact for all. With a robust ESG framework, the bank emphasises its commitment to environmental initiatives, social responsibility, and governance and transparency. This strategic focus enhances the bank’s operational resilience and fosters positive impact on the communities it serves, positioning KCB Group as a leader in responsible banking practices throughout the region.
In its 2023 Sustainability Report, KCB reported substantial progress in embedding sustainability in its operations. The bank approved KES 21.4 billion in green loans, constituting 15.5 percent of its total loan portfolio. These funds support projects in e-mobility, climate change adaptation, energy efficiency and renewable energy, marking KCB’s pivotal role in facilitating Kenya’s transition to a green economy.
In the period under review, KCB reported an 11.14 percent reduction in carbon intensity per staff member and increased its use of energy efficient LED lighting by 50 percent. Furthermore, in 2022, the bank introduced a reforestation project known as the Linda Miti initiative. This ambitious initiative aims to plant and nurture over 1.8 million trees in the next five years, collaborating with public primary and secondary schools.
The Linda Miti initiative aligns with the government’s goal of planting 15 billion trees by 2032, a significant effort to increase tree cover from the current 12.13 percent to 30 percent. The Linda Miti initiative is one of the ways in which the bank is contributing towards reduction of carbon emissions in what the bank does on a day-to-day basis. To this effect, the bank is investing KES 12 million every year to support this ambitious initiative.
On the social front, KCB has made remarkable strides in promoting inclusivity and supporting underserved communities. A standout initiative during the reporting period was the Female-Led and Made Enterprises (FLME) program, through which the bank disbursed KES 115 billion to women-owned businesses, empowering over 700,000 entrepreneurs. This initiative not only fosters gender equality but also significantly contributes to the economic empowerment of women across Kenya. Additionally, KCB has prioritised special interest groups, ensuring that 10 percent of all tenders are dedicated to women, youth, and people with disabilities (PWDs).
In 2024, KCB received KES 69 million (USD 554,000) from the Green Climate Fund (GCF) to support its concept note on ‘Climate-Smart Technologies for Production Efficiency and Business Value’ among Micro, Small, and Medium Enterprises (MSMEs) in Kenya. The funding, provided through the Project Preparatory Facility (PPF), is being used to conduct feasibility studies and develop operational frameworks. This initial investment sets the stage for a larger disbursement anticipated later this year.
By providing access to much-needed financing, KCB aims to enable MSMEs to adopt climate-friendly technologies and practices. This will not only help mitigate climate change but also create sustainable jobs and drive economic growth.
Youth empowerment remains a focal point for KCB. Through the 2jiajiri program, the bank has supported 2,877 young entrepreneurs, resulting in the creation of 13,352 direct jobs. The focus on education, entrepreneurship, and financial inclusion allows KCB to address youth unemployment and foster a more inclusive society.
In terms of governance, KCB leads by example, deeply embedding ESG principles across its operations. It is notable that KCB is the first financial services provider in East Africa to have its sustainability report receive limited assurance by external auditors, setting a new benchmark for transparency and accountability in the sector.
This year, KCB has committed to developing, publishing and aligning its Group ESG and Sustainability Report with the International Financial Reporting Standards (IFRS) S1 and S2. By embracing these new reporting standards ahead of their mandatory implementation in 2027, KCB positions itself as an early adopter and demonstrates a proactive approach to transparency and sustainability reporting.
Since 2020, the bank has successfully screened a total of KES 1.1 trillion through its Environmental and Social Due Diligence process, which evaluates the environmental, social and transition risks associated with loan facilities. The bank specifically targets loan facilities exceeding KES 50 million and projects with a turnover of KES 100 million or more, enabling it to effectively manage risks while promoting sustainable financing practices.
The bank’s leadership in ESG has not gone unnoticed; in 2024, it received five awards at the Kenya Bankers Association (KBA) Sustainable Finance Awards. These accolades, which include recognition for best in sustainable finance, promoting accessibility for PWDs and championing gender inclusivity, underscore KCB’s ongoing efforts to drive social progress and economic empowerment through responsible banking practices.
In alignment with the 17 United Nations (UN) Sustainable Development Goals (SDGs), KCB recognises these goals as significant opportunities to drive and implement innovative business solutions and technologies that address critical sustainable development challenges.
As part of this commitment, the UN Global Compact has introduced Forward Faster, a global platform aimed at guiding companies on where they can achieve the most impactful and rapid results by 2030. This initiative highlights five key areas of action to accelerate progress across all SDGs: Gender Equality, Climate Action, Living Wage, Water Resilience, and Finance and Investment.
KCB has strategically focused its efforts on these priority areas to help fast-track the achievement of SDG targets. Through its diversity and inclusion policy, the bank has fostered an environment where every employee can reach their full potential, regardless of race, ethnicity, gender, marital status, age, disability, or religious beliefs. Notably, KCB has achieved a significant milestone, with female employees now comprising 51 percent of the workforce, up from 47 percent in 2022, marking the first time that women outnumber men at the bank.
As KCB continues to integrate ESG principles into its operations, the impact it has on society, the environment, and the economy is unmistakable. From financing green projects and reducing its carbon footprint to empowering women and youth, KCB is setting a strong example of responsible banking. Under the visionary leadership of Paul Russo, the bank is not only fostering a more inclusive and sustainable future for Kenya but also reflecting its enduring commitment to making a lasting, positive impact on the community and the environment.
AUTHOR: HILDA NTHENYA
EDITOR: MARTIN O’NEIL
