Dr. Micheal Atingi-Ego, the Deputy Governor Bank of Uganda has asked company managers to promote financial inclusion to create a sustainable financial sector.
Beyond the traditional business contracts, Dr. Atingi-Ego said firms must act as responsible citizens by not only considering financial performance but also the impact of Environmental, Social, and Governance (ESG)
“This growing focus on ESG necessitates integrating into business models and corporate strategy. So the frameworks that need to be put in place are those that encompass resource efficiency, Social Responsibility, and strong governance, which is very crucial.” Deputy governor BOU said.
This was during the 13th Annual Directors and Company Secretaries Conference organized by KPMG and the Institute of Chartered Secretaries and Administrators (ICSA Uganda) that went down at Mestil Hotel. The conference was held under the theme: “Corporate Governance: The Navigation System During Economic and Geopolitical Uncertainty”.
He urged company directors to think beyond making profits and focus on how to promote sustainability through addressing environmental and social requirements.
“Take the case of Uganda, more than 70% of Ugandans are engaged in agriculture, agriculture that is ring-fenced, so if we don’t tackle the environmental aspect of this, agriculture is going to be affected and the bulk of the population involved in agriculture, their livelihood is going to be affected and you cannot have a sustainable community,” he said.
Dr. Atingi-Ego said for businesses to become sustainable, companies should ensure that they create money for stakeholders for a sustainable working environment.
“In the past, most boards have been content on how do we create value for our shareholders, we need to change that narrative to how do we create value for our stakeholders, because by creating money for stakeholders, you’re ensuring that the community in which you are operating is sustainable and that’s when your business can become sustainable.” He added.
He added that to promote financial inclusion, companies need to bring these all players into the formal financial institution to empower them to take advantage of the financial products.
“We can take advantage of the fintechs by reaching those funding at the bottom of the economy clear, because if you can improve the livelihood, then you’re talking about a sustainable financial sector. And that’s the ESG that the Bank of Uganda encompasses.” Dr. Micheal said.
Jane Okot P’Bitek Langoya, the president ICSA told reporters that organizations have a responsibility to ensure that they postively affect societies around them.
“So for instance, if you are in, an environment where the people around you are informal, how do you help them? in a big company, in a rural area for instance, you build a school get the children to go to school,” she said that it’s a bigger company’s responsibility to covert societies from informal to formal.
“We need supplies in the organization, we look for those people in the society around as much as possible to supply your organization. But when they supply you, you say, I can’t deal with you as an individual, I need a company. Slowly, you’re bringing them up into how to be in the formula. So it’s the responsibility of the bigger organizations to bring up those who are not in the formal sector.” She said
