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Sustainability 04 Nov 2019

Antoni Ballabriga: “We’re rewarding companies with sustainable and measurable results”

Urgency and opportunity are the two defining traits of the current situation that financial institutions are facing in this climate emergency scenario. For Antoni Ballabriga, Global Head of Responsible Business at BBVA, there are “two axes that define this age of responsibility.” At BBVA, “we are lending at interest rates that reward companies that meet measurable sustainable goals.” In his opinion, the financial sector “is taking ownership of its share of responsibility in this transition, although we still have a long way to go.”

BBVA’s Global Head of Responsible Business took part in the International Environmental Sustainability Congress, organized by Grupo EIGE in Madrid, on October 31. Speaking to an audience consisting of scholars, experts, public representatives, business leaders and NGOs, Antoni Ballabriga devoted his presentation to dispel a series of myths surrounding sustainable finance.

For Ballabriga, one of these myths is that “the sustainable agenda is an agenda defined by U.S. interests.” In his opinion, “the truth is that companies also have a tremendous responsibility, especially the financial sector, just as set forth by the Paris Agreement, which calls upon its responsibility to direct the financial flows to achieve sustainable development without contributing to climate change by promoting the transition towards a low-carbon economy.”

For BBVA’s Head of Responsible Business, another myth is thinking that we’re facing a transformation that’s “challenging, but manageable, as always.” “On the contrary,” he said, “we are facing a challenge unlike any other humanity has ever faced. Nothing will be the same. In ten years we have the opportunity to make a change that we cannot make with the same old recipes that have worked up till now. We need to rethink everything, from how we consume, how we move, how we work, how we invest, etcetera.”

In ten years we have the opportunity to make a change that we cannot make with the same old recipes that have worked up till now

Considering that this transition is mainly about energy is, in his opinion, another myth that needs to be debunked, because “we’re talking about water, mobility, investments that affect all industries.” To this respect, “in aggregate, the Sustainable Development Goals are going to create markets worth €12 billion by 2030,” said Ballabriga. “In our case, at BBVA, we’re committed to aligning our activity to the goals set out in the Paris Agreement, because we are convinced that sustainability is the biggest opportunity that the banking industry is going to have in the next ten years.

The lack of reference standards for the financial industry is the fourth myth he addressed. “That’s just not true, as shown by the steps and initiatives rolled out jointly by the industry. There is a set of standards, which may be lacking in some areas, but which have helped organize the sector, from standards for issuing green bonds to social bonds; and they have led to the singing of the Principles for Responsible Banking.”

The fifth myth has to do with the idea that “investors are becoming increasingly interested by sustainable businesses, but not too much yet.” To this regard, he shared data from the Global Sustainable Investment Review 2018, according to which sustainable investing assets in the five major markets stood at $30.7 trillion at the start of 2018. “At BBVA, we are witnessing how investors are become more and more interested every day in understanding how businesses integrate the opportunities and risks that come with sustainability into their business models,” he explained.

Antoni Ballabriga, Global Head of Responsible Business at BBVA, during his speech in the International Environmental Sustainability Congress.

“Sustainable finances are not only in the agenda of regulators and supervisors” is another myth that’s been proven false. Indeed, the financial sector has defined a roadmap to become “truly sustainable, as proven by the network of central banks that created the NFGS (Network for Greening the Financial System) and which, among other things, is recognizing climate change as a real financial risk.”

To dispel the last great myth “the lack of appetite by end-customers that does not see sustainability as a priority,” Ballabriga referred to the demands of the new generations mobilized around climate. “This is an unstoppable citizen movement that will end up being even more widespread,” he concluded.

The International Environmental Sustainability Congress, was also attended by Hugo Morán, the Secretary of State for Environment of the Ministry of Environmental Transition, highlighted the uncertainty surrounding sustainability following the cancellation of the climate change summit scheduled to take place in Santiago de Chile in November. “We are facing the sixth mass extinction according to scientific reports and Spain will not be spared,” said Morán, who called upon society and the need for economic activity to preserve natural resources.

Other speakers at the event included the Paloma Martín, Councilor of Environment, Territorial Planning and Sustainability of the Community of Madrid; Germán Granda, honorary president of El País, Juan Luis Cebrián; Germán Granda, CEO of Forética; SpainSif Chairman Joaquín Garralda; Rafael González Sánchez, general manager of Renewables at Endesa; Mar Asunción, Head of the WWF Climate and Energy program; and Cristina Narbona, vice president of the Spanish Senate and member of the Spanish Network for Sustainable Development.

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