Leading Kenya’s green finance agenda

As global economies recalibrate with the realities of climate change and the urgent need for sustainable development, Kenya is positioning itself at the forefront of Africa’s green transition.

Central to this national pivot is the Kenya Development Corporation (KDC), the country’s flagship development finance institution (DFI), which is integrating environmental, social and governance stewardship into its business strategies.

KDC’s mandate encompasses a broad spectrum of sectors crucial for Kenya’s economic transformation, including manufacturing, post-harvest management, healthcare infrastructure, tourism, the digital and creative economy/ICT, and climate change initiatives.

Its proactive embrace of green finance marks a major milestone in Kenya’s development trajectory.

By targeting the high-impact areas, the corporation not only nurtures economic diversification but also champions projects that strengthen Kenya’s industrial base and improve livelihoods.

Under its sustainability and green financing strategy, KDC has embedded sustainability criteria into its core investment processes and corporate culture. This sustainability proposition underscores the belief that financial returns and sustainable impact are mutually reinforcing drivers of long-term value for investors, communities, and the environment.

National policy developments are reinforcing the new moves aimed at positioning KDC as Kenya’s green development finance institution. The introduction of the Kenya Green Finance Taxonomy by the Central Bank in April 2025 has established a common framework for classifying environmentally sustainable activities.

By integrating green principles into its financing decisions, enterprise support, risk management, and capital mobilisation efforts, we seek to influence sustainable transformation across its entire mandate.

Each sector presents unique opportunities to adopt low-carbon technologies, enhance environmental performance, reduce operational vulnerabilities, and unlock investment flows that support Kenya’s transition to a green and circular economy.

Through this strategy, we will enable enterprises across all sectors to reduce production costs, comply with emerging sustainability standards, access new climate finance opportunities, and enhance competitiveness in domestic and global markets.

Engagement with strategic stakeholders and technical support is playing a role in accelerating this transition. We are collaborating with the Treasury, the World Bank and Impact Africa Consulting to refine the sustainability framework, align internal systems with global practice and strengthen the operational tools required for green finance implementation. This positions the corporation to engage more effectively with green finance investors.

Our evolving role reflects more than an internal policy shift. It points to a broader national approach that treats sustainability as integral to economic planning as Kenya becomes a high-income country.

With clearer standards, strengthened capacity and targeted technical support, we are ready to lead Kenya’s development pathway that considers climate change-aligned investment and long-term resilience.

Norah Ratemo is the Director General and Board Member of Kenya Development Corporation (KDC).