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A consultant, Masiye Banda, has called on the Zambian government to incentivize investors who embed Environmental, Social, and Governance (ESG) principles in their operations.
Speaking at the International Multi-Disciplinary Conference on Friday at the Mulungushi International Conference Centre in Lusaka, Banda emphasized the need for investors to integrate ESG factors into their investment decisions, highlighting the role of responsible investment practices in sustainable development.
Banda encouraged investors to evaluate ESG factors, including climate change, risks, and opportunities, alongside traditional financial considerations.
“How should investors deal with ESG matters? Integration: When making investment decisions, ESG factors should be considered alongside traditional financial factors,” he said during his presentation on Foreign Direct Investment – With a Sustainability Lens.
Banda outlined the government’s role in fostering ESG-aligned investments, including the need for a national investment strategy to define priorities and goals around ESG.
“The government through its various agencies must regularly monitor and evaluate Foreign Direct Investment (FDI) to ensure that it aligns with national development goals and priorities. It must also enforce laws and regulations on ESG factors,” Banda stated.
He also proposed the provision of incentives for investors adopting responsible investment practices and stressed the importance of transparency in disclosing ESG performance and policies to stakeholders.
“Provide transparency into investment holdings and ESG performance of underlying companies. Report ESG performance and progress towards sustainable goals,” he added.
Banda further explained the concept of FDI with a sustainability focus, noting its potential long-term environmental, social, and governance impacts.
“FDI with a sustainability lens refers to investments that may have negative environmental, social, or governance impacts, including the potential harm to ecosystems and the well-being of communities affected by projects,” he said.
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