GTO and IBUA Coordinate Efforts to Implement ESG Aspects and EU Taxonomy in Banking Management: What Will This Bring to Ukrainian Business?
On February 6, a Memorandum of Interaction and Cooperation was signed in Kyiv between the Independent Banking Association of Ukraine (IBUA) and the Green Transition Office. This document aims to create an effective platform for expanding sustainable development financing, implementing environmentally responsible financial instruments, and harmonizing ESG principles in the banking sector.
The event brought together representatives of the financial market, state institutions, and experts in green transition. The main goal of cooperation is to simplify Ukrainian business access to green financing, attract international investments, and implement ESG principles in Ukraine's financial sector.
The head of the Green Transition Office, Andriy Kitura, noted that the main challenges in attracting green financing are its implementation mechanisms and prospects for implementing sustainable development principles in the banking sector. Therefore, it is important to build an effective infrastructure and create efficient implementation mechanisms, including the introduction of ESG aspect management approaches, which will allow businesses to access financial resources for sustainable development.
"When speaking about the main difficulties in implementing green financing, they are primarily related to the insufficient development of the domestic financial market," Kitura noted.
Another barrier is limited enterprise access to cheap green loans. Currently, to obtain preferential targeted financing, a company must either be very large or have a long history of cooperation with international financial organizations. Therefore, the signed Memorandum aims to change the situation and make green financing accessible to a wider range of enterprises, particularly small and medium-sized businesses.
IBUA Council Chairman Volodymyr Mudryi emphasized that simplifying access to financing for business is an important step for developing the Ukrainian economy.
"The banking sector plays a key role in implementing ESG principles in Ukraine. IBUA has created an ESG subcommittee that facilitates the unification of approaches to integrating these principles and simplifying their implementation. We welcome everyone who joins this process, as it is impossible to ensure sustainable development of individual economic sectors in isolation from each other. Cooperation with the Green Transition Office is an important step to make these processes systematic and effective. This will not only help the banking system adapt to European standards but also open new opportunities for business and investors," Mudryi emphasized.
An important direction of cooperation will be collaboration on developing legislation that complies with EU Taxonomy provisions and its implementation in the banking sector. The introduction of legislation according to EU Taxonomy will help clearly define which projects comply with sustainable development principles. The teams of the Green Transition Office and IBUA will work to establish clear and transparent sustainability criteria in banking activities, corporate governance, and business financing.
Additionally, banks will receive new tools for attracting international financing, and enterprises will gain access to environmentally oriented loans and grants.
The National Bank of Ukraine has also outlined its next steps for 2025 in sustainable development. These include implementing ESG risk monitoring according to the updated Macroprudential Policy Strategy, developing general recommendations on approaches to ESG risk management for the Ukrainian banking sector considering domestic banks' experience and European practices, as well as the ESG Policy White Paper, and conducting a new survey of banks on ESG risk management in spring 2025 and implementing such surveys on a permanent basis.
"Building productive communications between the state and financial sector, which allows policy formation considering its assessments and expectations, is an integral component of our successful EU integration," said Kateryna Rozhkova, First Deputy Governor of the NBU.
An important stage of cooperation will be adapting the Ukrainian banking system to EU regulatory standards in sustainable financing.
"We aim to develop a realistic plan for implementing new regulations in finance, involving the widest possible range of stakeholders," emphasized Kitura.
According to Volodymyr Mudryi, harmonizing Ukrainian standards with European ones will open new opportunities for financial sector development and investment attraction.
"For successful implementation of these standards, we need to create an effective coordination mechanism between the state, business, and banking sector. It's important that the regulatory framework is not only adapted to EU requirements but also considers Ukrainian financial market realities. We are confident that through cooperation with partners, we will create reliable financial instruments that will help businesses integrate sustainable development principles into their activities," added Volodymyr Mudryi.
The Ministry of Economy of Ukraine presented its strategic vision for implementing green transition reforms and the National Energy and Climate Plan. The ministry emphasized that the banking sector plays a key role in financing the country's sustainable economic development, as financial institutions can become drivers of environmental transformation through lending and investment mechanisms.
"Implementing EU Taxonomy is one of the important steps toward Ukraine's EU membership and aligning our legislation with European standards. In 2025, the Ministry of Economy together with the Green Transition Office will work on developing new regulations to implement these European standards. We will consider current environmental norms, climate legislation, and sectoral development strategies. In this direction, we already see opportunities for active cooperation with the NBU and IBUA. This will help us effectively update legislation, considering all market participants' opinions, and successfully implement Taxonomy in the banking sector," said Andriy Telyupa, Deputy Minister of Economy of Ukraine.
The signed Memorandum provides for creating joint working groups, conducting consultations with business and international partners, and training programs for financial institutions.
The implementation of EU Taxonomy will increase international investors' trust and help accelerate Ukraine's integration into the global sustainable financing system.
There is still much work ahead, but this Memorandum has become an important step toward a future where sustainable development will become the foundation of the country's financial strategy.
The Green Transition Office is an independent advisory body under the Ministry of Economy of Ukraine that helps to implement reforms in the field of green transition, energy and climate policy of Ukraine. The Green Transition Office operates with the financial support of the UK International Development and is implemented by Dixi Group.
Published on