A spotlight on Dr. Ronald Rateiwa and Professor Meshach Aziakpono, Stellenbosch Business School, and their research insight included in the recently published Routledge-CoBS book Responsible Finance and Accounting: Performance and profit for better business, society and planet
Africa, the UN SDGs and a Key Role for Non-Bank Financial Institutions by Tom Gamble, Ronald Rateiwa, and Meshach Aziakpono.
As governments, industries, and businesses push towards a greener, fairer transition in the light of social and climate crisis, the eyes of the world are increasingly focusing on Africa. Rich in resources, growing in both skills and knowledge, the continent has huge potential to create wealth for its myriad of peoples and be among those to reach the UN SDGs. However, the challenges are great, not least in finding the financial resources to fund it all.
Dr Ronald Rateiwa and Prof Meshach Aziakpono at Stellenbosch Business School believe non-bank financial institutions – NBFIs – can play a key part in solving it. With their research featuring in the recently published book Responsible Finance & Accounting, they spare us a moment to look at the challenges and potential avenues to explore to put NBFIs among the front runners in the race to the SDGs.
NBFIs: 3 insights, 4 focus areas
The need for alternative and additional sources of funding to achieve the SDGs has intensified due to the COVID-19 pandemic, climate change, the ongoing Russia-Ukraine crisis and a tightening of global financial conditions, affirm Rateiwa and Aziakpono. These factors have constrained both traditional commercial lines of credit and fiscal space.
For them, NBFIs have an important role to play. Not only to support economic growth, but also build the resilience of African economies against economic, political and climate shocks, while addressing the triple-evil – poverty, unemployment, and inequality.
To unlock the potential of NBFIs in the respective economies, state Dr Ronald Rateiwa and Prof Meshach Aziakpono, there is need for an enabling regulatory framework to help tackle four key areas:
- Ensure resilience of the financial sector to future shocks
- Promote continuous monitoring of systemic risks in the financial sector
- Encourage deployment of capital into green investments, and
- Reduce the cost of doing business which affects the pipeline of bankable projects.
“Increasing the role of NBFIs towards the achievement of SGDs,” say Rateiwa and Aziakpono, “complements the current efforts to intensify their current initiatives towards ESG adoption for sustainable growth.”
NBFIs and Africa: What needs changing?
For NBFIs to truly play their part in boosting business and economic growth, Dr. Rateiwa and Prof. Aziakpono believe there has to be change. This includes the need for dialogue with authorities to address some of the regulatory constraints which limit the growth and ability of NBFIs to invest in certain types of assets, while holding the bulk of their assets in Government Bonds and cash balances.
Moreover, there is the need to accelerate the discussions to increase the role of NBFIs in the development agenda, with the researchers asserting that institutional savings from life-long contributions by workers must contribute more to creating a legacy for generations to come by financing sustainable growth to fight against poverty, unemployment, and inequality.
Africa and Beyond: Hope for the future
“The solutions for our problems are within, or with us,” say Dr. Rateiwa and Prof. Aziakpono. “Given Africa’s endowment with natural resources, additional sources of finance from NBFIs to exploit and value-add these resources sustainably has the potential to leapfrog the continent while realizing its demographic dividend.” For them, the time is now, or never. The opportunity cost of waiting for a perfect time is very high – and increasing.
- Can Non-Banking Financial Institutions Help Africa Reach the SDGs? Discover Dr. Ronald Rateiwa and Prof. Meshach Aziakpono’s research insight featured in the new book by Routledge-CoBS Responsible Finance and Accounting: Performance and profit for better business, society and planet
- Link up with Ronald Rateiwa and Meshach Aziakpono on LinkedIn
- Read a related article: Global social entrepreneurship: An opportunity for today’s world in crisis.
Learn more about the Council on Business & Society
The Council on Business & Society (The CoBS), visionary in its conception and purpose, was created in 2011, and is dedicated to promoting responsible leadership and tackling issues at the crossroads of business and society including sustainability, diversity, ethical leadership and the place responsible business has to play in contributing to the common good.
Member schools are all “Triple Crown” accredited AACSB, EQUIS and AMBA and leaders in their respective countries.
- ESSEC Business School, France-Singapore-Morocco
- FGV-EAESP, Brazil
- School of Management Fudan University, China
- IE Business School, Spain
- Keio Business School, Japan
- Stellenbosch Business School, South Africa
- Trinity Business School, Trinity College Dublin, Ireland
- Warwick Business School, United Kingdom.