“Metals, key minerals in energy change”
Deia Markova oversees commodity trade finance at SociÃ©tÃ© GÃ©nÃ©rale in Switzerland – and is also a sustainability specialist. She says finews.com how finance can reconcile the two.
Deia Markova, you had a career in commodity finance in metals trading. You are also responsible for Societe Generale in Switzerland sustainability efforts. Isn’t that a contradiction?
Sustainable development is now all the rage, but SociÃ©tÃ© GÃ©nÃ©rale has been a pioneer in the field. We started 20 years ago, and over the years we have built a solid expertise since, all along the relevant value chains. I can say with confidence that today within our group, each employee and each company is challenged on a daily basis to find the means to play a role in the energy transition and to actively contribute to helping our customers achieve their goals. ESG.
“Big data to map greenhouse gas emissions”
The energy transition is a complex subject that affects all aspects, all industries, all sectors and all countries. And therefore, the solutions are complex and require a lot of creativity and pragmatism. Working for two years on impact finance and the new business model allows me today to co-build, with our customers and partners, effective solutions to support their energy transition.
How does it work in practice?
For example, we are working with Carbon Chain and several clients, using big data and machine learning technologies to measure greenhouse gas emissions from certain trade flows through mapping of the entire chain. ‘supply. This mapping gives our customers and ourselves a better understanding and transparency of their company’s current carbon footprint situation at every stage of a transaction – in the warehouse, at the port, on the ship. .
“Wind and solar power require large base and niche metals”
It also creates the necessary level of auditability and the ability to compare with benchmarks. We started this project because we lacked the data we needed to analyze the emissions from our commercial loan portfolio and understand the true carbon footprint of the complex individual supply chains we finance around the world.
Your previous clients included metals and mining groups. Can this industry suddenly go green?
Metals and minerals are essential for a clean energy transition and low carbon technologies. Wind, solar and energy storage batteries are widely recognized as key components in meeting future energy needs at low to zero greenhouse gas emission levels. Each of these technologies is mineral intensive, requiring a large amount of base and niche metals.
What is the result of this?
We are witnessing a historic shift from a fuel-intensive energy system to a material-intensive energy system. A typical electric car requires six times more mineral inputs than a conventional car, and an onshore wind power plant requires nine times more mineral resources than a gas power plant.
Problematic from all points of view?
Societe Generale supports producers ensuring sustainable and reliable extraction of the minerals necessary for low-carbon technologies. We also support producers in implementing measures to reduce their carbon footprint and contribute to the circular economy. Our role is to help accelerate the decarbonisation efforts of our customers.
What is the link with your Russian business partners?
Recent examples in the Russia and CIS region include the structuring of the first green loan in the gold mining sector globally, one of the first green loans in the mining sector and the first in the region. We also set up the first sustainability-linked credit facility for one of the world’s largest low-carbon aluminum producers.
“Steel producers can adapt to climate change”
We are very involved in setting industry standards for decarbonization. By co-leading the Steel Climate-Aligned Finance Working Group, our ambition is to help define a path consistent with the development of low-carbon industrial solutions in the steel industry. Societe Generale supports steel producers using cutting-edge hydrogen technologies to produce low-carbon steel demonstrating the industry’s potential for climate adaptation.
What can we concretely Societe Generale Swiss branch do at fight against climate change? How do you have an impact?
Indeed, Societe Generale aims to lead a lasting change in finance and the Swiss entity is no exception to this ambition. We have developed a complete range of innovative sustainable finance solutions, dedicated to our clients, companies and financial institutions. This includes financing tools, investment solutions and advisory capabilities.
“Switzerland brings various players in finance, NGOs and academics to the debate”
For example, financing tools linked to ESG are already in place with all our corporate clients in Switzerland or will be implemented as soon as the old existing instruments expire in the years to come. We have also built a unique advisory capacity in terms of the structuring of ESG obligations and vis-Ã -vis external ESG rating agencies.
You were at the recent Building Bridges in Geneva. Is Swiss finance doing enough for sustainability?
Yes, I had the honor to share my point of view on âThe leverage power of the financial sector towards a just transitionâ during a panel organized by the ILO in partnership with the UNEP FI. Building Bridges is a unique conference, with very large attendance and exceptionally rich content. What makes it unique is that it brings together various actors from the financial industry, the United Nations, international organizations, NGOs, universities and local, cantonal and national authorities and makes us discuss and collaborate to achieve sustainable development goals.
Impact is a key issue – as speaking alone does not solve climate change.
Let me focus for a moment on impact investing where Switzerland plays a leading role. According to the Swiss Sustainable Investment Market Study 2021, sustainable investments again increased significantly by 31% in Switzerland compared to the previous year.
“One in three Swiss francs is a factor of sustainability”
The total volume of investments taking ESG factors into account with at least one of the approaches covered thus reached 1.52 billion Swiss francs at the end of 2020, which means that around one in three Swiss francs of assets managed in Switzerland takes into account a sort of sustainability factor. . In my opinion, this is a pretty impressive result and one that gets better every year.
Where do you see a need to catch up?
Societe Generale is an active member of Swiss Sustainable Finance, or SSF. The roadmap launched by SSF during âBuilding Bridgesâ defines concrete measures to be taken by players in the Swiss financial center to accelerate the achievement of global climate goals and the United Nations Sustainable Development Goals.
“Nationalities and origins count as much as gender in diversity”
It is an ambitious roadmap with concrete actions for all players in the Swiss financial services sector. As Switzerland has already achieved a lot in the area of ââsustainable finance, the aim of this roadmap is to manage the next steps and introduce effective measures on a larger scale.
Half of the management of SociÃ©tÃ© GÃ©nÃ©rale in Switzerland is already made up of women. How does this show up in decision making?
Indeed, our board of directors is quite unique. Besides the fact that half of us are women, we also have a good diversity of nationalities and origins. This allows us to approach subjects from different angles. Our decisions reflect this diversity – they are balanced and adapted to the multicultural reality of our Branch.
Who sets the tone – women or men?
We always seek to capitalize on the diversity of points of view and to find the best compromise allowing the company to develop, while keeping our employees passionate about their profession.
What advice would you give to young female bankers on their career path?
Be bold and believe in yourself. What really makes a difference in business is courage – calculated risk taking. People who become good leaders have an above-average willingness to take bold action, but they increase their chances of success through careful deliberation and preparation.
“Bringing disruptive thinking to the table”
And often this is accompanied by disruptive thinking and innovation. Let me give you an example. Taking charge of executing a transaction that is important to your client often requires bold negotiation, the implementation of an innovative solution, and a lot of conviction. But it’s the transactions that make you visible and recognized in an organization. And climbing the ladder is essential.
Deia Markova is head of the commercial commodity finance department at SociÃ©tÃ© GÃ©nÃ©rale – a traditional area of ââstrength for the French lender. She began her career in investment banking for the Paris-based bank before later specializing in structured business solutions for metals and mining producers in Russia and the CIS states. From 2014 to 2017, Markova led the business lending activities of Sberbank in Switzerland, with a focus on producers and traders of commodities.