Country
Azerbaijan

Local Project Partner
Central Bank of Azerbaijan (CBAR)
Azerbaijan Banking Association

German Project Partner
Finance in Motion GmbH

Donor
Partner-financed

Duration
15.08.2025 - 31.10.2026

In Azerbaijan, there is a pressing need to integrate ESG principles more closely into economic and financial decision-making processes. At present, there is a widespread lack of uniform standards, reliable data and institutional structures for the systematic assessment of ESG risks. This complicates both risk management and the development of consistent sustainability approaches in the business and financial sectors.

The project supports the Central Bank of the Republic of Azerbaijan in introducing the ESG Risk Radar and accompanying ESG guidelines for the financial sector in Azerbaijan. The goal is to strengthen the capacity of banks and other financial institutions to systematically identify and assess ESG and climate risks and integrate them into their business and risk management processes in order to promote sustainable financing practices in the financial sector. To this end, sector-specific risk analyses and assessment tools are being developed that, in particular, provide transparency regarding the ESG and climate risks of various economic sectors.

Task
To achieve these objectives, the following measures in particular will be implemented:

• Introduction and adaptation of the ESG Risk Radar to assess climate and ESG risks in Azerbaijan’s key economic sectors
• Development of ESG Risk Radar Guidelines
• Development of comprehensive ESG guidelines for the financial sector
• Stakeholder dialogues, expert events, and needs assessments to promote acceptance and practical implementation of the new ESG tools and guidelines in the financial sector