Page 16 - CMA Journal (Nov-Dec 2025)

Exclusive Interview

They are particularly important because the majority of
vulnerable Pakistanis depend directly on natural Floods in Pakistan are not
resources for their livelihoods. Nature should not be seen
as opposing economic development or human only caused by rainfall,
well-being, but as a critical partner in sustainable
development. melting glaciers, monsoons,
ICMA: ESG is often compliance-focused. How can it and cloudbursts, but the
deliver real environmental and social impact in
developing countries like Pakistan? resulting disaster is
Dr. Adil Najam: Over the past three decades, our amplified by the state of
understanding of Corporate Social Responsibility (CSR) and
how businesses interact with the environment has evolved both built and natural
significantly, including in the evolution of Environmental,
Social, and Governance (ESG) standards. CSR was often infrastructure. Nature-based
about doing whatever a company could as a voluntarily
approach. ESG, if implemented correctly, is more structured solutions can address these
and target-oriented. Companies set specific ESG targets, challenges by restoring and
measure their performance against them, and integrate
these targets into their business strategy, just like they do maintaining natural
with profit or production goals. ESG discussions largely
originated from businesses themselves, emphasizing ecosystems
accountability and measurable impact.

One challenge arises when companies set ESG targets
superficially or use them as slogans. This creates a gap panels, because conventional energy has become too
between what is promised and what is delivered, which expensive. Over the past two decades, many
invites criticism. Good ESG, however, should drive manufacturers have also shifted to producing their own
meaningful strategic conversations at the Board and renewable energy. Smart climate finance should focus
Executive levels, leading to achievable yet ambitious on rewarding such positive actions rather than
targets that enhance both sustainability and business incentivizing harmful practices.
performance. The key is to approach ESG as a strategic
tool, not just a compliance or a marketing exercise. When Third, Pakistan has not fully utilized available
done right, ESG can create opportunities for both international climate finance. Compared to similar
environmental progress and corporate growth. countries, Pakistan lags in accessing global financing
from multilateral financial institutions, infrastructure
ICMA: Based on your global experience, what bold financing bodies, and other international sources. While
climate finance ideas could Pakistan adopt to build access can be challenging, stronger partnerships and
resilience quickly? coordinated efforts between government, businesses,
and financial institutions can significantly improve
Dr. Adil Najam: At one level, the right climate finance
Pakistan’s ability to mobilize these resources.
actions depend on the specific realities of countries and
even individual companies. However, if we focus on bold ICMA: How can young leaders and local communities
ideas, I would highlight three main points. First, we take the lead in driving climate action and ESG
should examine mistakes in the current financing model. initiatives?
Often, we view climate finance only as new funds
coming in for climate action. But sometimes the greatest Dr. Adil Najam: The two groups you have mentioned,
impact comes from stopping harmful financing young people and local communities, are the most
practices. A clear example is subsidies that encourage important actors in climate action. Young people matter
environmentally harmful behaviors. One bold step is to deeply in these discussions because they are the ones
identify and remove these distortions from the financing who will live with the long-term realities of climate
system. change. It is therefore essential to give young people
meaningful opportunities to engage in climate action.
Second, Pakistan should recognize and support climate
They can become drivers of innovation, particularly
financing already happening at the individual and
through new technologies and creative approaches to
corporate levels. Many ordinary people invest their own
problem solving.
savings in renewable energy solutions, such as solar
14 ICMA’s Chartered Management Accountant, Nov-Dec, 2025