Did you know that Zambia has been actively engaging in ESG and climate resilience initiatives to address the challenges posed by climate change since the 1970s with the enactment of the Natural Resources Conservation Act?

These initiatives are aimed at promoting sustainable development and building resilience for climate change. The term “ESG” was popularized in the 21st century and refers to ‘environmental, social and governance’─ a set of standards used to measure an organization’s environmental and social impact.

The following are some key initiatives and programs in these areas:

1. National Climate Change Policy (NCCP)

Launched on the 3^rd of March, 2017, Zambia’s NCCP aims to mainstream climate change into all sectors of the economy to ensure sustainable development. The policy focuses on adaptation and mitigation strategies, promoting the resilience of communities and ecosystems.

2. Zambia Environmental Management Agency (ZEMA)

ZEMA formerly the Environmental Council of Zambia (ECZ) is responsible for regulating and coordinating environmental management and protection activities. It ensures that environmental considerations are integrated into development planning and decision-making processes.

3. Climate Resilience Projects

• Pilot Program for Climate Resilience (PPCR): Zambia is part of the PPCR, which aims to integrate climate resilience into core development planning. It focuses on improving infrastructure, promoting sustainable land and water management, and enhancing early warning systems.

• Zambia Integrated Forest Landscape Project: This project aims to reduce deforestation and forest degradation, enhance carbon stocks, and improve rural livelihoods through sustainable forest management.

4. Renewable Energy Initiatives

• Scaling Solar Project: This initiative, supported by the International Finance Corporation (IFC), aims to develop solar power projects to increase Zambia’s renewable energy capacity and reduce dependence on hydropower, which is vulnerable to climate variability.

• Off-Grid Energy Access: Various programs are promoting off-grid solar solutions to increase energy access in rural areas, contributing to sustainable development and resilience.

5. Agricultural Resilience

• Climate-Smart Agriculture (CSA): The Ministry of Agriculture promotes CSA practices to enhance the resilience of agricultural systems. This includes conservation agriculture, agroforestry, and the use of drought-resistant crop varieties.

• Zambia Agriculture Research Institute (ZARI): ZARI conducts research on crop improvement, soil fertility, and sustainable farming practices to support climate-resilient agriculture.

6. Community-Based Adaptation

Various NGOs and international organizations are working on community-based adaptation projects to build local resilience. These projects often focus on improving water management, diversifying livelihoods, and enhancing food security.

7. ESG Reporting and Standards

• Zambia Chamber of Commerce and Industry (ZACCI): ZACCI is promoting the adoption of ESG standards among businesses to enhance sustainability and corporate responsibility. This includes encouraging companies to adopt sustainable practices and report on their ESG performance.

• Stock Exchange Requirements: The Lusaka Securities Exchange (LuSE) has guidelines for listed companies to disclose their ESG practices, aligning with global sustainability reporting standards.

Key Challenges

Despite these initiatives, Zambia faces significant challenges in its ESG and climate resilience efforts:

• Funding: Limited financial resources hinder the implementation of large-scale climate resilience projects.

• Capacity Building: There is a need for greater capacity building at local and institutional levels to effectively implement and manage ESG and climate initiatives.

• Awareness and Education: Increasing awareness and education on climate change and sustainability practices is crucial for widespread adoption.

• Regulatory and Compliance Risks: failure to comply with local environmental regulations leads to significant financial penalties from the Zambian Environmental Management Agency (ZEMA).

• Higher Insurance Costs: Companies in Zambia face higher insurance premiums if they are considered high-risk due to poor environmental practices or lack of climate resilience measures.

• Resource Scarcity: Water and energy shortages in Zambia, exacerbated by climate change, have significantly increased costs for businesses dependent on these resources.

• Increased Cost of Capital: Companies with poor ESG scores in Zambia face higher interest rates and financing costs, as lenders and investors demand higher returns to compensate for perceived risks.

How can you get involved?

Organizations can get involved by funding, capacity building, raising awareness on climate change and the advantages of embracing ESG practices. Individuals can equally get on-board through proper usage and management of scarce natural resources such as water, land and clean energy.

Continuous efforts in policy implementation, stakeholder engagement, and capacity building are essential to achieve long-term climate resilience and sustainability goals.

Interested in learning how PRS can support your organization document, research, and test innovative solutions for ESG and climate resilience projects? Reach out to us on prsadmin@prs.org.zm or +260974493357 for a tailored consultation and discover how our solutions can drive your business forward.

Authors:

Fredrick Musonda, Partnerships and Communications Officer,

Ruth Ndhlovu Sinkala, Finance and Administration Officer