Climate-proofing of our homes is a must, and it can be achieved if we invest in quality, and efficiency – Dr. Gordon Cordina

BOV is positioning itself as a leader and catalyst supporting Malta’s decarbonisation journey by launching innovative financing solutions to support this transition – Mr. Kenneth Farrugia


While addressing a Business Breakfast organised by Bank of Valletta on the theme of Climate Challenges and Opportunities for Real Estate, Dr. Gordon Cordina, BOV Chairman, emphasised that climate proofing of our homes is a must, and can be achieved if we invest in quality and efficiently.

When addressing the attendees, Dr. Cordina highlighted the fact that climate issues related to real estate development and management are driven by a number of factors. These include international commitments, which will need to be sustained by Government regulation, incentives and disincentives, regulatory pressures on banks to finance resource-efficient, environmental and climate-friendly real estate projects, as well as market trends.

When highlighting these issues, the BOV Chairman emphasised that the dividends reaped from climate real estate investment must also extend to financial gains from energy and water savings, efficient waste management, economic benefits from the creation of green jobs, and also from better quality offered by real estate in terms of well-being and competitiveness.

“The prospects for viable climate investment aren’t bad, but the question is, as always, who will pay? He opined that energy savings  would probably not be enough to cover the total investment costs”. Dr. Cordina continued that other elements must be recovered from Government, the real estate occupier, and industry “by inculcating better quality in real estate, making improved efficiency in development and management essential”.

In his concluding words, Dr. Cordina stated that a strong element of Government and regulatory intervention is required to make all this happen and stressed the need for mechanisms through which Government passes savings from energy, water and waste management and tax revenues to households and businesses making green investments.

“Financial institutions also have a role to play by enabling investment to take place effectively by valorising the benefits enjoyed in the future. These must create mechanisms to provide resources to fund the necessary investments, which are eventually repaid through gains realised. Such mechanisms are to reflect the economic opportunities as well as the social dimensions involved in climate investments, through a fair distribution of benefits and costs. The arithmetic seems right. The players are here. Now we need a good dose of goodwill and the optimism to believe we can overcome the current challenges,” concluded Dr. Cordina.


We need to build a better competitive proposition – Mr. Kenneth Farrugia

Kenneth Farrugia, Chief Executive Officer of BOV, said that “as Malta’s leading Bank, we are keen to lead and dynamically support Malta’s transition to a greener economy. We are equally motivated by an overarching aspiration to take forward various ESG initiatives that will contribute to strengthen Malta’s value proposition. This will in turn positively impact foreign direct investments and tourism amongst other wider economic and social benefits which are critical to sustain Malta’s economic growth in the longer term”.

Bank of Valletta CEO emphasised the fact that whilst defining an ESG strategy is challenging, the hardest phase is its implementation which will only be facilitated through both ownership and culture change.   Understandably, there are evident challenges in balancing the short-term costs of going green with the medium-and longer-term benefits that a green strategy will deliver. However, these challenges can be addressed through carefully designed incentives and innovative financing solutions.

Mr Farrugia outlined his view that apart from the environmental focus, more consideration needs to be given to the impact of the construction sector on the wider society. Amongst others, the way that the community is benefitting from the construction of tenements through more green open spaces, development of amenities for occupiers and support for local enterprises needs to be given its due consideration.

Moreover, there are four equally important considerations supporting the need for companies to embed ESG in their business and operational models. Firstly, it is becoming very evident that energy efficient properties have a higher rental/purchase value because of lower operational costs, have higher occupancy rates and stronger capital appreciation upside potential. This presents a compelling opportunity for the construction sector to develop energy efficient properties to meet the demands of this fast-growing market.

Secondly, investors are giving increased importance to green credentials when investing in green capital market instruments that contractors or developers may be considering issuing to finance their projects.  Equally, Banks are also introducing advantageous credit financing pricing on energy efficient development projects.  On this front, Bank of Valletta has taken the lead in the market as it has recently launched a new 10-year Business Energy financing solution that carries a 0% rate of interest. In addition, the Bank has various other highly interesting energy efficiency driven financing solutions.

Thirdly, company directors are also expected to ensure that ESG is embedded in the business and operational model of the Company they are representing on the board.  Lastly, the fourth important consideration is that ESG driven organisations will be more appealing to attract and retain quality employees in view of the alignment of ESG driven values that both employer and employee embrace.

In his concluding note, Mr Farrugia reiterated the Bank’s commitment and strong intent to play a leading role in the country’s journey towards a greener economy. He appealed to all stakeholders to adopt an agile approach in this journey where ESG will bring about national value creation and ensure longer term sustainable economic growth.


We acknowledge the need to upgrade the energy efficiency levels of our buildings – Dr. Stefan Zrinzo Azzopardi

Among the keynote speakers that addressed the audience present for the Business Breakfast was Hon. Dr. Stefan Zrinzo Azzopardi, Minister for Public Works and Planning, who made reference to the fact that efforts are underway at the Building and Construction Authority (BCA) to change the way energy performance certificates (EPCs) operate. He also emphasised the need to upgrade the energy efficiency levels of buildings, admitting that this will be a significant change for government, the business community and the country as a whole.

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