CBSL charts greener future with Sustainable Finance Roadmap 2.0

CBSL Governor Dr. Nandalal Weerasinghe, World Bank and IFC in Sri Lanka Country Manager Gevorg Sargsyan

 -Pix by Lasantha Kumara 

• Sustainable Finance 2.0 moves beyond green to embrace inclusiveness and social impact
• CBSL Governor Dr. Nandalal Weerasinghe hails Roadmap as key to embedding ESG principles into business operations
• Says Roadmap prioritises climate and business risk analysis, value chain evaluation and technology-driven ESG measurement
• Focuses on broadening Inclusive Green Finance via NFIS Phase 2 for MSMEs, financial literacy, digitisation and financial consumer protection
• World Bank and IFC in Sri Lanka Country Manager Gevorg Sargsyan says building truly sustainable financial ecosystem in Sri Lanka is a collective endeavour

By Janani Kandaramage

Marking a significant shift in Sri Lanka’s journey towards a greener and more inclusive financial system, the Central Bank yesterday unveiled the Sustainable Finance Roadmap 2.0 for 2025-2029, an ambitious update to its 2019 framework. 

This second iteration reflects the financial sector’s strengthened commitment to building economic resilience amid escalating climate risks and social challenges. With a sharper focus on risk-informed decision-making, targeted action planning, and the financial empowerment of vulnerable communities—the Roadmap comes at a time when sustainable finance is becoming an essential pillar for national and global stability. 

This latest framework was designed with the technical and financial support from the International Finance Corporation (IFC), in partnership with the European Union, under the Accelerating Climate Smart and Inclusive Infrastructure in South Asia (EU-ACSIIS) program.

Delivering the keynote address, Central Bank of Sri Lanka (CBSL) Governor Dr. Nandalal Weerasinghe commended the move, labelling it a “critical step in the complete integration and management of Environmental, Social, and Governance (ESG) principles into business operations.” 

While ESG is self-regulated in Sri Lanka, many other jurisdictions have passed transformative policies that include mandatory climate disclosure regulations. The new Roadmap, conceptualised by the CBSL in partnership with the IFC, strives to amalgamate global expertise with local insights from key stakeholders, including the Securities and Exchange Commission of Sri Lanka (SEC), the Insurance Regulatory Commission of Sri Lanka (IRCSL), the Colombo Stock Exchange (CSE), the Sri Lanka Banks’ Association (SLBA), The Finance Houses Association of Sri Lanka (FHA), and academia, to champion value chain and climate scenario analysis.

“The Sustainable Financing Roadmap 2.0 ensures identification and precise measurement of ESG principles by close observation of recent trends by leveraging technology and wider stakeholder involvement,” Dr. Weerasinghe said, adding that such risk evaluation is not only crucial to enabling targeted action, but will foster resilience across all regions and sectors alike, driving innovative 

solutions for a sustainable future.



The CBSL Governor also noted that the updated framework aims to strengthen green financing by diversifying into financial products tailored to address specific needs, including: 

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1. Green loans financing infrastructure development in sectors such as solar energy and sustainable agriculture.

2. Climate risk insurance to ensure prolonged security to farmers victim to natural disaster. 

3. Providing capacity building for bank staff on green finance principles to effectively manage environmental risks.

“At present, the World Bank estimates that climate change could push an additional 32 million to 132 million people into extreme poverty by 2030, signifying the critical need for defences against the threat it poses to livelihoods and industry. Therefore, preparing stakeholders to stay economically resilient amidst these extreme weather conditions is fundamental,” he said.

Highlighting the necessity of tackling social sustainability, Dr. Weerasinghe explained that the roadmap extends its scope to the micro, small and medium-sized enterprises (MSMEs) sector via the second phase of the NFIS31 aimed at promoting Inclusive Green Finance (IGF) to these enterprises. 

Commenting on the additional support extended to the sector, he highlighted efforts to strengthen financial consumer protection standards and enhance the security and efficiency of digital payment systems. These developments, he asserted, are essential to advancing sustainable finance goals, as they promote greater financial inclusion—particularly for underserved communities—by fostering trust, transparency, and accessibility in the financial system.

He also emphasised the importance of expanding financial literacy to the marginalised – including women, persons with special needs, and low-income households. 

Dr. Weerasinghe added: “Improving financial literacy is crucial for empowering these groups to champion resilient and climate-friendly MSMEs, enabling informed decision-making, reducing financial exploitation, and ensuring participation in the formal financial ecosystem.”

The Governor expressed optimism that prompt implementation of these measures could pave the way for sustainable economic development, while acknowledging the success of other ongoing initiatives, particularly with the adoption of the International Financial Reporting Standards (IFRS) S1 and S2, tailored as SLFRS S1 and S2 for local application. 

SLFRS S1 focuses on general requirements for disclosing sustainability-related financial information, while SLFRS S2 addresses climate-specific disclosures. 

Dr. Weerasinghe called these standards, effective from 1 January, a critical step in enhancing transparency and trust in sustainability-related disclosures, integral to clean governance.

In addition, he discussed Sri Lanka’s comprehensive Carbon Net Zero 2050 Roadmap and Strategic Plan, which outlines sector-specific strategies across six key areas: energy, transport, industry, waste management, agriculture, and forestry. The strategy focuses on limiting greenhouse gas emissions and enhancing carbon sequestration through sustainable practices and technological innovations.

“This initiative, alongside all sustainability options, has elevated the bar to new heights, destined to transform businesses into socially responsible entities with purpose-driven action and profit with measurable value,” he remarked.

Speaking at the event, World Bank and IFC in Sri Lanka Country Manager Gevorg Sargsyan noted that as Sri Lanka strives for resilient and inclusive growth, sustainable finance will be crucial in creating jobs and driving economic expansion, while also positioning the country to be investment ready. 

He further highlighted that building a truly sustainable financial ecosystem in Sri Lanka is a collective endeavour – one that the IFC has been a part of from inception, and remains committed in working together with the CBSL and industry stakeholders to bring the shared vision of the Sustainable Finance Roadmap 2.0 to fruition.

The launch event was attended by distinguished guests including officials of the IFC and EU, Ministerial Secretaries, and senior officials of Government institutions; national and international experts on sustainability, representatives of financial institutions, and partner agencies.

The keynote was followed by a session providing an overview of the Sustainable Finance Roadmap 2.0, led by CBSL Assistant Governor W.A. Dilrukshini and IFC ESG Officer Wei Yuan. A panel discussion on “Rolling Out the Sustainable Finance Roadmap 2.0” featured national technical expert on sustainability Dr. Thusitha Sugathapala, CBSL Bank Supervision Department Additional Director S. Ketawala, DFCC Bank Chief Executive Officer Thimal Perera, and CSE Chief Regulatory Officer-Designate Nilupa Perera.

The Sustainable Finance Roadmap 2.0 can be accessed using the following link:

https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/sustainable_finance_roadmap_2.0.pdf.