Sierra Leone’s first assessment against the Voluntary Sustainable Finance Principles (VSFPs) gives financial institutions a shared baseline and a clear path to stronger, more sustainable practice.
Prepared with support from Invest Salone, a UK-funded private sector development programme, the assessment covers 16 financial institutions: 12 commercial banks and four microfinance institutions. It builds on the framework developed jointly by the Sierra Leone Association of Commercial Banks and Sierra Leone Association of Microfinance Institutions, with Invest Salone’s technical assistance. The findings incorporate self-assessments by the 16 participating institutions.
The results reflect an early stage of transition. They highlight where targeted support can accelerate progress, rather than judge institutions’ financial performance. Comprehensive environmental, social and governance (ESG) and sustainable finance systems are still at early stages of development across the participating institutions.
From dialogue to action
Since 2021, Invest Salone has helped the sector turn dialogue into an industry-owned framework backed by research, training and practical tools.
- 2021–2022: Industry dialogue built momentum for a sustainable finance roadmap.
- 2023–2025: Training, tools and knowledge exchange strengthened sector capacity.
- 2025–2026: Industry consultation shaped nine Principles and practical implementation guidance.
- 2026: The baseline assessment was conducted before the VSFPs were launched and adopted in June 2026. The report, completed in September 2026, sets out priorities for implementation.
A baseline for progress
The assessment provides a sector-wide baseline for tracking implementation of the Voluntary Sustainable Finance Principles. The results of the self-assessment indicated that the most developed areas are ethical conduct and formal policies and procedures for excluding financing for harmful environmental or social activities, followed by a strong focus on financial inclusion initiatives. The main gaps identified are in embedding environmental and social principles across institutional governance, staff capacity building plans, annual reporting processes and operational sustainability. While some institutions have started introducing environmental and social risk management (ESRM) systems, adoption and application remain uneven. The next phase should advance implementation across all nine Principles, with priority given to embedding ESRM into governance, credit processes, monitoring and reporting, supported by adequately resourced, consistently applied and measurable systems.
Priorities for action
The report sets five immediate priorities:
- Set clear ownership: Give boards, managers and designated staff responsibility for delivery.
- Build capability: Invest in practical training, shared tools and peer learning.
- Measure progress: Use common indicators and regular reporting.
- Strengthen lending decisions: Embed environmental and social risk checks.
- Lead by example: Reduce institutions’ own environmental footprint.
These foundations can support new green and inclusive products and help make sustainability part of everyday strategy and lending.
Measuring progress every year
Repeating the assessment annually will show what is working, where support is needed and how each institution is advancing from its starting point.
The Sierra Leone Association of Commercial Banks and Sierra Leone Association of Microfinance Institutions can drive momentum through annual implementation key performance indicators covering action plans, oversight, training, risk screening and reporting.
Recognising leadership
The associations should establish an annual recognition platform celebrating leadership and improvement, recognising institutions that lead, improve and share effective approaches to sustainable finance.
Clear criteria, credible evidence and peer learning can turn individual success into sector-wide progress.
A call to act
Financial institutions now need to turn the VSFPs into funded plans, accountable leadership, stronger capability and regular reporting.
Development partners are invited to sustain and build on Invest Salone’s investment in sustainable finance since 2021 through continued support for coordinated training, practical systems and financing partnerships.
Sierra Leone now has the framework and baseline to turn commitment into measurable progress for institutions, clients and communities.
