LB Finance becomes first finance company to be carbon neutral

By Shehana Dain

Sri Lanka Carbon Fund has issued the Carbon Neutral Certificate to LB Finance PLC, making the company Sri Lanka’s first finance company to be declared ‘carbon free’. 

The certification comes with a confirmation under the UN Framework Convention on Climate Change which declares that LB Finance has offset its carbon footprint to achieve carbon neutral status.

“This has been an amazing achievement for a company better known for its forays in finance.  The carbon neutral certification marks a pivotal landmark in the history of LB Finance, we take our environment quite serious and have taken numerous steps to minimise our carbon footprint.  We will continue to consolidate company-wide action involving employees and methods of operations that cuts down carbon emissions while maximising the efficient usage of resources,” said LB Finance Managing Director Sumith Adhihetty.

Sri Lanka Carbon Fund CEO Buddika Hemashantha told the Daily FT that 12 companies in Sri Lanka have received carbon conscious status and out of which three companies have achieved the carbon neutral status to date. He also stated that a prominent state enterprise is close to fulfilling requirements to attain the carbon neutral status.

The annual carbon foot print in Sri Lanka amounts to 60 million metric tons and is only 0.1% from the global output. However he stressed that for a developing country like Sri Lanka showcasing positive attitude towards global warming can be beneficial in the financial aspect as well in terms of FDIs.

“There is a financial gain as well when companies get this status. Today international institutions such as the World Bank and IMF give special attention to companies which have received the carbon neutral status when providing financial assistance. Additionally most of these sustainable methods are cost saving in the long run.”

Hemashantha went on to say that he has been in contact with the private sector with regard to carbon emissions and that the organisation is taking a sectoral approach contacting industry bodies.

“We have spoken with The Hotel Association in Sri Lanka (THASL) and Institute of Bankers Sri Lanka (IBSL) and we have received favourable response from them. We approached some hotels and they’re also interested.  Mainly we are looking for sectoral commitment I believe it would be more effective,” he added.

Speaking at the event LB Finance AGM Marketing Roshan Jayawardena noted: “In 2014 LB Finance had a carbon emission of 2400 metric tons we were quite surprised to know that even as a finance company our carbon foot print was quite substantial. This was the first step we took to become carbon neutral and we took measures to reduce it. Using LED screens for all our light boards that we use for advertising purposes from the usual tube light method was one of those steps.”

LB Finance started measuring carbon footprint in 2013 under the supervision of the Sri Lanka Carbon Fund, a national body operating under the Ministry of Mahaweli Development and Environment with the mandate to estimate the emission of greenhouse gases in carbon equivalents arising from business activities.

The company follows a three step approach to achieving carbon neutral status; measuring carbon footprint is the first step which involves measuring direct and indirect carbon emission by monitoring each stage of operations. The Greenhouse Gas Accounting Protocol developed by  the World Business Council for Sustainable Development(WBCSD) and World Resource Institute and Intergovernmental Panel on Climate Change (IPCC) guidelines were used in measurement process. 

As the second step the company reduces the energy consumption by implementing a number of internal initiatives. Finally, the company voluntarily offsets the remaining unavoidable carbon emissions by purchasing carbon credits from a certified project of UN’s Framework Convention on Climate Change.

40 branches on the cards for LB Finance

LB Finance will be adding 40 branches to its island wide branch network this year whilst currently 10 locations have been set.

LB Finance AGM Marketing Roshan Jayawardena told the Daily FT that even though the marketing plan for FY2016 constitutes of 40 branches only 10 locations have been finalised, however he was optimistic about the completion of the proposed new branch network.

Speaking about the company’s newest business proposals for the year he said: “We are planning to implement the carbon neutral concept to all our new branches which we will open. We will give products like green mortgages that are for people who will adhere to the green format when building houses. We are also targeting to lease out solar power systems only banks are giving loans, at the moment no leasing company is doing this.”