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The Agricultural Finance Corporation (AFC) has become the first Kenyan institution to receive the Sustainability Standards and Certification Initiative (SSCI) Certification, marking a significant step towards green and inclusive finance in the country.
The Agricultural Finance Corporation (AFC) has been awarded the prestigious Sustainability Standards and Certification Initiative (SSCI) Certification, making it the first institution in Kenya to achieve this global recognition. The certification underscores AFC's commitment to aligning agricultural financing with international sustainability standards and supporting Kenya's transition to a climate-resilient economy.
The award was conferred in Karlsruhe, Germany, and is seen as a major milestone in the country's push for green and inclusive finance. George Kubai, the Managing Director of AFC, stated that this recognition reinforces AFC's leadership in advancing sustainable agricultural finance and affirms its role as a trailblazer in sustainability initiatives.
Established in 1963, and later incorporated as a full-fledged financial institution in 1969 under the AFC Act (Cap 323 of the Laws of Kenya), the AFC is a Development Finance Institution (DFI) wholly owned by the Government of Kenya. Its core mandate is to provide credit for agricultural development, offering financial support and technical assistance to farmers.
Agriculture is the backbone of Kenya's economy, with approximately 80% of the rural population relying on it for their livelihoods. AFC's role is crucial in enhancing financial inclusion, expanding credit access, fostering employment, creating wealth, and contributing to national food security.
The SSCI certification highlights AFC's dedication to integrating environmental, social, and governance (ESG) tenets into its operations. This involves developing policies and guidelines on environmental and social risk, credit risk, and climate change strategy, all approved by the AFC Board and periodically reviewed.
By adhering to these global standards, AFC aims to enhance its capacity to finance climate-smart agricultural projects, attract new partnerships, and provide farmers with the necessary tools and resources to build resilience against climate change.
Arshad Rab, Chairman of the International Council of Sustainability Standards for Value-Driven Financial Institutions and CEO of EOSD (the European Organization for Sustainable Development), congratulated AFC on its achievement. He praised the institution's leadership and its commitment to ensuring Kenya's agriculture remains productive, resilient, and prepared for future challenges such as climate change, international market competitiveness, and food security.
Mr. Kubai assured stakeholders that AFC remains steadfast in its commitment to growing its sustainable finance portfolio in line with its Strategic Plan, empowering farmers, strengthening value chains, and building resilience against climate change.
Analysts suggest that this development could influence public debate and policy execution in the near term. Stakeholders are urging clarity on the timelines for implementing new sustainable finance initiatives, the associated costs, and the safeguards that will be put in place to ensure equitable access and impact for all farmers. The successful integration of these standards will be critical for AFC to scale up innovations that reduce agricultural risks and unlock value across value chains, ultimately driving Kenya's ambition of becoming a climate-smart agricultural hub.
