Major Pakistani Banks Fail Climate and Biodiversity Policy Benchmarks
A new benchmark report by Fair Finance Pakistan reveals that seven major commercial banks in Pakistan are failing to meet adequate climate and biodiversity policy standards. The study shows an average score of only 1.12 out of 10 for climate policy and 1.69 for biodiversity, highlighting a significant gap between internal sustainability policies and the actual safeguards applied to financed projects. While banks maintain high policy coverage for their own operations (75.4%), this drops drastically to just 23.1% for the companies and projects they fund. This discrepancy suggests that capital is being deployed without sufficient environmental or social oversight, potentially undermining Pakistan's national climate agenda (NDC 3.0). The report follows a December 2025 mandate from the State Bank of Pakistan requiring boards to approve climate risk implementation plans by September 2026. Analysts warn that without enforceable lending requirements and transparent disclosure of financed emissions, banks remain unable to mitigate environmental risks effectively.
Topics: banking regulation biodiversity climate policy Pakistan economy sustainable finance