The International Islamic Trade Finance Corporation (ITFC), a member of the Islamic Development Bank (IDB) Group, has announced the adoption of its new environmental and social policy, marking a strengthened commitment to sustainable trade.
Commitment to Climate and Social Equity
In a context where many ITFC member countries are among the most vulnerable to climate change, this initiative aims to integrate ecological and responsible practices into all trade finance operations. Aligned with the Paris Agreement and the United Nations Sustainable Development Goals (SDGs), ITFC’s policy seeks to reduce the carbon footprint of trade, which accounts for 20 to 30% of global CO₂ emissions.
Five Strategic Pillars for Sustainable Trade
ITFC’s environmental and social policy is based on five key pillars:
- Environmental Action: Proactive integration of green solutions into operations and workplace environments, prioritizing digitalization and energy efficiency.
- Sustainable and Inclusive Finance: Prioritization of investments in resilient sectors such as sustainable agriculture, financial inclusion, and green supply chains.
- Capacity Building: Support programs to help member countries mitigate climate risks and promote social inclusion.
- Innovative Treasury Solutions: Increasing investments in sustainable financial instruments compliant with Sharia, including the issuance of green Sukuk.
- Transparent Monitoring and Evaluation: Integration of best practices in environmental and social (E&S) responsibility, with transparent disclosure of performance.
A Vision for the Future
Hani Salem Sonbol, ITFC’s CEO, stated: “Our work in some of the world’s most climate-vulnerable regions has given us firsthand insight into the reality of climate change. By maintaining our commitment to sustainable growth, we are streamlining our approach to maximize our positive impact.”
With this new policy, ITFC sets a milestone in integrating climate and social issues into trade finance, providing a model for similar institutions globally.
