Staff Reporter
Victoria Falls – Zimbabwe’s mining industry must urgently embrace climate finance and invest in cleaner technologies if it is to remain competitive in global markets increasingly driven by environmental standards and carbon reduction targets, Old Mutual Zimbabwe has said.
Speaking at the Chamber of Mines Zimbabwe Annual Mining Conference and Exhibition 2026, Old Mutual Zimbabwe General Manager for Commercial Services Ben Sithole said climate change had evolved from being an environmental issue into a significant business risk that could directly affect mining companies’ profitability, operations and access to international markets.
Presenting on the theme “Powering Sustainable Mining Through Strategic Climate Finance,” Sithole said climate finance would become a critical tool in helping the sector manage climate-related risks while unlocking new growth opportunities.
“Climate finance is achieved by mobilising and managing financial resources from public, private and alternative sources to address climate-related financial risks. This capital is specifically allocated towards physical risk mitigation and transition risk management,” he said.
He noted that Zimbabwe’s economy was highly vulnerable to climate change, citing losses of US$2.7 billion from Cyclones Idai and Ana between 2019 and 2022, while warning that up to 40 percent of the country’s Gross Domestic Product could be at risk by 2030.
Sithole said the mining industry faced increasing exposure to both physical and transition risks as droughts, floods and heat waves intensified.
“Climate change has transitioned from a mere environmental concern to a material risk for mining operations. Physical climate hazards directly impair asset values, escalate capital and operating costs and disrupt production schedules,” he said.
He added that water insecurity, unstable electricity supplies and supply chain disruptions were already threatening mining operations.
According to Old Mutual’s climate risk assessments, Zimbabwe’s mining sector carries moderate-to-high physical risks and high transition risks driven by evolving global regulations.
Sithole warned that international policies such as the European Union’s Carbon Border Adjustment Mechanism (CBAM) and global net-zero commitments could significantly affect Zimbabwe’s mineral exports if producers fail to decarbonise their operations.
“Mining companies must invest in cleaner technologies, such as electric vehicles and renewable energy for operations, to comply with carbon pricing and emission standards,” he said.
To support this transition, Old Mutual is expanding its green finance portfolio to help mining companies move from climate vulnerability towards long-term competitiveness.
The company is offering several financing solutions, including preferential lending rates for renewable energy projects, sustainability-linked loans tied to environmental performance indicators, and green bonds to support mine decarbonisation and fleet electrification.
Sithole said sustainability-linked loans would reward mining companies that meet measurable environmental, social and governance (ESG) targets such as reducing emissions and improving water recycling systems.
Old Mutual is also promoting enhanced climate reporting standards aligned with global frameworks such as IFRS S2, Global Reporting Initiative standards and Reserve Bank of Zimbabwe climate risk guidelines.
He said the company was investing in climate awareness programmes targeting employees, customers and the broader public.
Sithole presented a case study showing how climate finance can improve operational resilience in the mining sector.
Faced with rising costs and frequent production disruptions caused by unreliable electricity supplies, one mining operation secured financing for a solar power plant through a green loan facility.
The financing package included reduced interest rates linked to verified emissions reductions and required the implementation of a climate risk mitigation plan.
The results were significant.
The mine achieved a 30 percent reduction in energy costs and increased processing uptime to 99 percent, reducing its dependence on Zimbabwe’s power grid while improving its export competitiveness under emerging carbon regulations.
Beyond mining, Old Mutual is rolling out broader climate finance initiatives across the economy.
These include green bonds, renewable energy project financing, carbon credit and offset services, climate-smart agriculture financing and ESG-linked corporate loans.
The company estimates Zimbabwe will require approximately US$12.5 billion in climate finance by 2030 to meet its adaptation and mitigation needs.
Sithole said the global green bond market had already reached US$620 billion, yet Africa accounted for less than one percent of that market, presenting a significant opportunity for Zimbabwe.
Old Mutual has also established a US$100 million Renewable Energy Fund to finance projects such as solar plants, hydropower, mini-grids, biomass energy, electric mobility infrastructure and energy efficiency projects.
The fund has already attracted commitments from Old Mutual Life Assurance Company Zimbabwe, the United Nations Capital Development Fund and the Government of Zimbabwe.
Sithole said Old Mutual was embedding climate resilience throughout its operations, with solar systems already powering several buildings and branches, while the group targets net-zero financed emissions by 2050 and a 50 percent increase in green investments by 2029.
“Our goal is to turn climate risks into a competitive advantage and become a stable, long-term partner aligned with global financial trends,” he said.
He urged mining companies to act now, warning that climate adaptation was no longer optional but essential for the sector’s sustainability and future growth.
