Profession / Affiliation
I am working as Sr. Director – Credit and Environment Risk in IDFC Ltd. In my role as a credit officer in IDFC Ltd, I have been involved in conducting project appraisals and financing of many infrastructure projects in energy and transportation sector in India. For the last few years I have been heading the environment risk group in IDFC Ltd wherein we conduct E&S due diligence and monitor requisite mitigation measures for the various projects financed by IDFC.
Sr. Director – Credit and Head Environment Risk at IDFC Ltd.
Definition of Responsible Investment Banking
I would define responsible financing as lending to entities that are aware and have relevant policies and frameworks in place for preventing environmental pollution and who are engaged closely with their local communities in implementing their projects in a sustainable manner and with minimal impact on the environment.
Areas of Expertise
Mr. Alok Dayal is the Senior Director – Credit and Environment Risk at IDFC Ltd. He is an Engineer and an MBA by qualification. He has over 19 years of experience in the infrastructure financing business. As a project financier he has been involved in appraising and financing numerous energy (generation and distribution), transportation and real estate projects. Along with his credit risk function he is also currently heading the environment risk group at IDFC Ltd. In this role he has been closely associated with IDFC’s initiatives in the areas of sustainable finance and responsible investing and in enhancing IDFC’s internal environment & social risk assessment processes. He played a key role in IDFC’s journey to become the first Indian Institution to sign up to the Equator Principles. He is currently engaged in leading the many initiatives with regard to formulating processes and frameworks within IDFC Ltd in its evolution as a Equator Principles institution.
Throughout the world, environmental and social concerns are increasingly integrated voluntarily by businesses into their operations and interaction with stakeholders as part of sustainable and long term business models. This has led to greater emphasis on disclosure, evident from business participation in forums such as the CDP, UNGC, UNPRI and UNEPFI. Environment and social issues cannot be ignored in the pursuit of greater economic development. This is particularly relevant to emerging economies such as India where building infrastructure and the utilisation of natural resources is imperative for the development of the economy. Industry insiders look for a balance between these two seemingly contradictory requirements, often exacerbated by poor governance and enforcement of regulations. One of the main concerns for investors in India is the lack of proper infrastructure. Growth of infrastructure is imperative for the longterm growth of the Indian economy and, as such, has been spearheaded through the PPP model under the project financing framework. This necessitates the large-scale acquisition of land and use of natural resources, making the principles of sustainable development assume greater importance. Internationally, financial institutions have met the ESG challenges posed by project financing activities by adopting the Equator Principles, often driven by brand reputation, best in class commitment, globally aligned systems and procedures, new financial business opportunities and access to low-cost funds. Regional disparity, however, means that few organisations from emerging economies have joined the EP association, particularly from the big emerging economies of China and India. This chapter examines the reasons behind the lack of EP adoption in India. It will attempt to answer the basic questions: what are the challenges in adopting EP for Indian banks and financial institutions? What are the opportunities? How can ESG concerns in the project financing operations of banks and financial institutions in India become mainstream?
Hobbies & Social Engagement
I love to read and travel to new places with my family. I am also an active Rotarian and participate in various social and philanthropic activities of my local rotary club in Mumbai.